EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0618513
Customs Act 1901
Background
Part XVA of the Customs Act 1901 (the Act) sets out a scheme under which Tariff Concession Orders (TCOs) may be made by the Chief Executive Officer of Customs (the CEO). A lower rate of customs duty applies to goods that are the subject of a TCO.
Under section 269F of the Act, a person may apply to the CEO for a TCO in respect of goods. If the CEO is satisfied that the application is not in respect of goods specified in section 269SJ of the Act, which sets out those goods that cannot be subject to a TCO, the CEO must decide whether the application meets the core criteria.
Section 269C of the Act provides that a TCO application meets the core criteria if, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B of the Act provides that ‘goods produced in Australia’ has the meaning given by section 269D, ‘ordinary course of business’ has the meaning given by section 269E and ‘substitutable goods’ in respect of goods the subject of a TCO application, means goods produced in Australia that are put, or are capable of being put, to a use that corresponds with a use (including a design use) to which the goods the subject of the application can be put.
Subsection 269P(3) of the Act provides that if the CEO is satisfied that a TCO application meets the core criteria, the CEO must make a written order (a TCO) declaring that the goods the subject of the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff) specified in the order applies.
Road Gear Australasia Pty Ltd applied for a TCO in respect of certain cushion matting on 14 November 2006.
Instrument
TCO No 0618513 was made on 9 February 2007. It declares that those certain cushion matting are goods to which item 50 of Schedule 4 to the Tariff applies since the CEO was satisfied that no substitutable goods were produced in Australia. The general rate of duty on these goods is 5%. The rate of duty for the goods subject to the TCO is 0%.
Consultation
Subsection 269K(1) of the Act provides in part that as soon as practicable after accepting a TCO application as a valid application, the CEO must publish a notice in the Gazette which includes an invitation to any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. The CEO did not receive any submissions in response to this invitation.
Commencement
Subsection 269S(1) relevantly provides that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged. TCO No. 0618513 is taken to have come into force on 14 November 2006.
The TCO does not affect the rights of a person (other than the Commonwealth) as at the date of registration so as to disadvantage that person or impose liabilities on a person (other than the Commonwealth) in respect of anything done or omitted to be done before the date of registration. The rights of importers will be beneficially affected. Under paragraph 126(1)(r) of the Regulations, importers of such goods will be able to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force. The TCO does not impose any liabilities on any person.
Overview
The Tariff Concession Instrument No. 0618513, enacted in 2007, is an instrument under the Customs Act 1901 designed to address the need for tariff concessions on specific goods. This instrument was introduced to provide relief to businesses by reducing the customs duty on certain goods, thereby encouraging their import and use within Australia. The instrument was issued by the Chief Executive Officer of Customs in response to an application from Road Gear Australasia Pty Ltd for tariff concessions on certain cushion matting, following a determination that no substitutable goods were being produced in Australia. This decision aligns with the policy objective of the Customs Act 1901 to facilitate the importation of goods that are not domestically produced, thereby supporting economic efficiency and consumer choice. The instrument effectively lowers the duty rate for these goods from 5% to 0%, effective from the date of the application, 14 November 2006.
Scope and Application
The Tariff Concession Instrument No. 0618513 under the Customs Act 1901 applies to Road Gear Australasia Pty Ltd, who applied for a tariff concession order (TCO) for certain cushion matting. The Act facilitates the application for and issuance of TCOs by the Chief Executive Officer of Customs, who is responsible for determining whether an application meets the core criteria, which in this case involves assessing whether substitutable goods were produced in Australia. The instrument extends to the Commonwealth jurisdiction and specifically applies to the reduction of customs duty on the specified goods from 5% to 0%, effective from the date the application was lodged, 14 November 2006. This TCO does not disadvantage any person other than the Commonwealth and does not impose any liabilities on individuals or entities. It notably excludes certain goods specified under section 269SJ of the Act, which cannot be subject to a TCO. The CEO did not receive any submissions opposing the TCO, indicating no objections were raised during the consultation period.
Key Provisions
The main operative sections of this legislation (sections 269C, 269F, 269K, 269P, and 269S) establish the framework for making Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. If the CEO is satisfied that the application meets the core criteria, they must make a written order declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (Tariff), thus applying a lower rate of customs duty. Section 269K requires the CEO to publish a notice in the Gazette inviting submissions if a TCO application is accepted as valid, although no submissions were received in this case. Section 269S specifies that a TCO comes into force on the day the application is lodged, with TCO No. 0618513 effective from 14 November 2006.
The obligations and requirements imposed by the Act on the parties governed by it are primarily centred around the application and approval process for TCOs. An applicant, such as Road Gear Australasia Pty Ltd, must ensure their application meets the core criteria as outlined in section 269C, specifically that no substitutable goods are produced in Australia. The CEO is obligated to assess whether the application meets these criteria and to make a written order if satisfied. Additionally, the CEO must publish a notice in the Gazette as soon as practicable after accepting the application as valid, inviting submissions from any interested parties. In this instance, the CEO did not receive any submissions in response to the published notice.
The legislation does not explicitly outline specific offences, penalties, or civil/criminal consequences for breaches within the context of TCOs. However, the general framework of the Customs Act 1901 and associated regulations may provide for penalties in cases of non-compliance with customs requirements. For example, section 126 of the Customs Regulations 1993 may apply in cases where duty is not paid or is underpaid, potentially leading to civil or criminal penalties. It is important for applicants and importers to ensure they comply with all relevant customs requirements to avoid any potential penalties.