EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0620111
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.
Siemens Ltd applied for a TCO in respect of certain indoor vacuum circuit breakers on 22 December 2006.
Instrument
TCO No 0620111 was made on 16 March 2007. It declares that those certain indoor vacuum circuit breakers 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 free.
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. 0620111 is taken to have come into force on 22 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. 0620111 was enacted in 2007 under the Customs Act 1901. This legislative instrument was introduced to provide tariff concessions on certain indoor vacuum circuit breakers, facilitating lower customs duties for these goods. The instrument was developed in response to an application by Siemens Ltd, which sought a tariff concession order (TCO) for its products, given that no substitutable goods were produced in Australia at the time of application. The Tariff Concession Order, made by the Chief Executive Officer of Customs, declares that these specific indoor vacuum circuit breakers are subject to a free duty rate, contrasting with the general rate of 5% applicable to such goods. The instrument aims to ensure that the application of tariff concessions does not disadvantage any person or impose liabilities on individuals for actions taken prior to the registration of the TCO, while potentially benefiting importers by enabling them to apply for refunds of duties paid on these goods since the TCO's effective date.
Scope and Application
The Customs Act 1901 applies to any individual or entity seeking to import goods into Australia. The scope of this legislation is particularly relevant to importers who apply for Tariff Concession Orders (TCOs) to benefit from reduced customs duties on specified goods. The Act is administered by the Chief Executive Officer of Customs (CEO) who reviews applications and determines whether they meet the core criteria, specifically ensuring that no substitutable goods are produced in Australia. The legislation applies to the Commonwealth level, impacting the national customs duty regime. TCO No. 0620111, concerning certain indoor vacuum circuit breakers, was issued under this Act, providing a free rate of duty instead of the general 5% duty, effective from the date of the application, 22 December 2006. There are no reported submissions opposing the TCO, and it does not disadvantage any existing rights of persons other than the Commonwealth.
Key Provisions
The main operative sections of the Customs Act 1901 that are relevant to Tariff Concession Orders (TCOs) include sections 269F, 269C, 269P, and 269SJ. Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of goods. The CEO must then determine whether the application meets the core criteria outlined in sections 269C and 269P, which include the requirement that no substitutable goods were produced in Australia on the day the application was lodged (section 269C). If the CEO is satisfied that the application meets these criteria, they must make a written order (section 269P(3)). Section 269SJ specifies goods that cannot be subject to a TCO.
The Act imposes several obligations and requirements on the parties involved. For instance, the CEO of Customs must assess the application for a TCO against the core criteria and decide whether it meets these criteria. If the application is valid, the CEO must make a written order declaring that the goods in question are subject to the specified item of the Customs Tariff. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made. Importers, on the other hand, benefit from the TCO as they can apply for a refund of duty on goods imported since the day the TCO is taken to have come into force.
In terms of consequences for breach, the Customs Act does not explicitly outline offences, penalties, or civil/criminal consequences for failing to comply with the provisions related to TCOs. However, any failure to comply with the requirements of the Act in general, including those related to customs duties, could potentially result in legal action, fines, or other penalties as prescribed by relevant sections of the Customs Act or other applicable laws. The exact penalties would depend on the specific breach and the provisions of other relevant legislation.