EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0702550
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.
Electrolux Home Products Pty Limited applied for a TCO in respect of certain domestic refrigerator parts on 16 February 2007.
Instrument
TCO No 0702550 was made on 11 May 2007. It declares that those certain domestic refrigerator parts 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. 0702550 is taken to have come into force on 16 February 2007.
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. 0702550, made in 2007 under the Customs Act 1901, was enacted to address the specific needs of businesses importing certain goods into Australia by providing tariff concessions. This instrument, created by the Chief Executive Officer of Customs, aims to facilitate trade by reducing the customs duty on specified goods, thereby encouraging importation and potentially lowering costs for businesses and consumers. The Customs Act 1901 establishes a framework within which these tariff concessions can be applied, ensuring that such measures are carefully considered and implemented to meet the policy objective of promoting efficient and competitive trade practices. The instrument was introduced without any adverse impact on the rights of individuals or entities, except for the Commonwealth, and it does not impose any new liabilities on persons other than the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0702550, made under Part XVA of the Customs Act 1901, applies to specific goods that are subject to a Tariff Concession Order (TCO) issued by the Chief Executive Officer of Customs (CEO). This legislation is targeted at goods that are not produced in Australia and are not specified in section 269SJ of the Act, which excludes certain goods from TCO eligibility. The instrument was enacted to provide tariff concessions for Electrolux Home Products Pty Limited's application concerning certain domestic refrigerator parts, effective from the date the application was lodged, 16 February 2007. The geographic reach of this legislation is national, applying across Australia as it is an instrument of the Commonwealth. The Act does not specify any exclusions or exemptions beyond those outlined in section 269SJ. The CEO's decision to grant a TCO is based on the core criteria set out in the Customs Act 1901, which includes the absence of substitutable goods produced in Australia. The instrument also allows for subordinate instruments to further define terms and extend or restrict application where necessary.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0702550, made under the Customs Act 1901, establish a framework for the Chief Executive Officer of Customs (CEO) to grant tariff concessions on certain goods. According to section 269F, an application for a Tariff Concession Order (TCO) can be submitted by any person, which the CEO must consider if it does not pertain to goods specified in section 269SJ. Section 269C stipulates that a TCO application meets the core criteria if no substitutable goods are produced in Australia at the time the application is lodged. This is further defined in sections 269D, 269E, and 269P(3), which outline the specific conditions under which goods can be considered substitutable and produced in Australia. Once the CEO determines that the application meets these criteria, they are required to issue a TCO under section 269P(3), which declares that the specified goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The Act imposes certain obligations and requirements on the parties involved. Specifically, section 269K(1) mandates that the CEO publish a notice in the Gazette as soon as practicable after accepting a TCO application. This notice invites any interested parties to submit any objections or submissions regarding the proposed concession. In the case of TCO No. 0702550, no submissions were received in response to the published notice, indicating that no objections were raised against the concession for the specified domestic refrigerator parts. Additionally, section 269S(1) provides that a TCO is effective from the date the application was lodged, which for TCO No. 0702550 was 16 February 2007.
Breach of the provisions under the Customs Act 1901 can result in various civil or criminal consequences, although specific offences and penalties are not detailed in the explanatory statement for this particular TCO. Typically, the Act allows for penalties under sections such as 282 for false statements and section 283 for fraudulent importation. These penalties can include fines and imprisonment, depending on the severity of the offence. In the context of TCOs, failure to comply with the terms set out in the concession order could lead to the loss of the tariff benefits granted, potentially resulting in the application of the standard duty rates to the affected goods. However, it is important to note that the explanatory statement does not specify penalties related to the non-compliance with the terms of this particular TCO.