EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0620002
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.
Arri Australia Pty Ltd applied for a TCO in respect of certain lights on 20 December 2006.
Instrument
TCO No 0620002 was made on 9 March 2007. It declares that those certain lights 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. 0620002 is taken to have come into force on 20 December 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. 0620002 was enacted in 2007 under the Customs Act 1901. This instrument was introduced to address the issue of providing tariff concessions for specific goods that do not have Australian-made alternatives. The Act, administered by the Parliament of Australia, aims to facilitate the import of goods that are not produced domestically by offering reduced or no customs duty. This legislative approach helps in promoting competition and consumer choice by making imported goods more affordable. The instrument was developed in response to an application by Arri Australia Pty Ltd for tariff concessions on certain lights, which was approved by the Chief Executive Officer of Customs, finding no substitutable goods produced in Australia, thereby meeting the core criteria outlined in the Customs Act. This initiative supports the policy objective of ensuring that Australian consumers and businesses have access to a broader range of competitively priced goods.
Scope and Application
The Customs Act 1901, specifically under Part XVA, facilitates the establishment of Tariff Concession Orders (TCOs) through the Chief Executive Officer of Customs (CEO). These orders allow for lower rates of customs duty on specified goods, provided that the application for a TCO meets the core criteria as outlined in the Act. An entity such as Arri Australia Pty Ltd can apply for a TCO in respect of goods, such as certain lights, if no substitutable goods are produced in Australia and the CEO determines the application aligns with the specified conditions. This legislation applies nationally across Australia and is intended to benefit importers by reducing their duty liabilities on the specified goods. The CEO is required to publish notices in the Gazette inviting public submissions on TCO applications, though no submissions were received for this particular case. The TCO, once registered, does not affect any pre-existing rights or liabilities of persons other than the Commonwealth, and it does not impose any new liabilities. Instead, it allows for potential refunds of duty for importers of the goods in question since the effective date of the TCO.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0620002 under the Customs Act 1901 (the Act) involve the establishment and application of Tariff Concession Orders (TCOs) for specific goods. Section 269F allows an individual or entity to apply to the Chief Executive Officer of Customs (CEO) for a TCO regarding certain goods. If the application is deemed valid and does not pertain to goods specified in section 269SJ, the CEO must assess whether it meets the core criteria outlined in section 269C. If the application is successful, the CEO must issue a written order under section 269P(3), effectively applying a reduced rate of customs duty to the goods in question.
The Act imposes specific obligations on the CEO when handling TCO applications. Under section 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any interested parties who might oppose the TCO. This ensures a transparent process and allows for public input. In the case of TCO No. 0620002, no submissions were received, indicating that the application met all necessary criteria without opposition.
The instrument itself, TCO No. 0620002, was made on 9 March 2007 and pertains to certain lights, applying the provisions of item 50 of Schedule 4 to the Customs Tariff Act 1995. The CEO was satisfied that no substitutable goods were produced in Australia, thus meeting the core criteria for the concession. The general duty rate for these goods is 5%, but the TCO reduces this to 0%. This concession is effective from 20 December 2006, the date the application was lodged, as per subsection 269S(1) of the Act.
Regarding the consequences of breach, the Act does not explicitly detail penalties or offences related to the failure to comply with TCO provisions. However, general principles of administrative law and compliance with customs regulations could imply administrative or legal consequences for non-compliance. Importers, however, are granted the right to apply for a refund of duty on goods imported since the TCO came into effect under paragraph 126(1)(r) of the Regulations, which provides a clear benefit and incentive for compliance. The TCO also explicitly states that it does not impose any liabilities on any person other than the Commonwealth.