EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0704155
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.
Carrier Air Conditioning Pty Ltd applied for a TCO in respect of certain roof mounted bus air conditioners on 19 March 2007.
Instrument
TCO No 0704155 was made on 08 June 2007. It declares that those certain roof mounted bus air conditioners 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 10%. 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. 0704155 is taken to have come into force on 19 March 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 Customs Act 1901, amended by Tariff Concession Instrument No. 0704155, was enacted to provide tariff concessions for certain imported goods, thereby addressing the issue of potentially prohibitive duty rates on specific imported items. This instrument was introduced to enable the Chief Executive Officer of Customs to grant tariff concessions that lower customs duty rates for particular goods, provided that no substitutable goods are produced in Australia. The objective of this measure is to ensure that Australian consumers and businesses have access to competitively priced goods, while also supporting the import of goods that cannot be produced domestically. The instrument was made by the CEO following an application by Carrier Air Conditioning Pty Ltd for tariff concessions on certain roof-mounted bus air conditioners, which was granted as no substitutable goods were produced in Australia at the time. The tariff concession became effective on the date of the application, 19 March 2007, and no submissions were received in opposition to the concession.
Scope and Application
The Customs Act 1901, specifically under Part XVA, governs the process by which Tariff Concession Orders (TCOs) are made by the Chief Executive Officer of Customs (the CEO). This Act applies to individuals and entities that seek tariff concessions for specific goods, provided those goods are not listed in section 269SJ, which excludes certain items from TCOs. The scope of the Act includes goods that are not substitutable by any produced in Australia on the date the TCO application is lodged, as defined in section 269C. The Act’s jurisdiction is nationwide, operating under the Commonwealth of Australia, and it extends to all relevant goods entering the country. The Act may be further specified through subordinate instruments such as regulations, which can define terms like 'goods produced in Australia' and 'ordinary course of business'. Importantly, the Act does not impose any liabilities on individuals or entities other than the Commonwealth and does not disadvantage anyone’s rights as at the date of the TCO application.
Key Provisions
The main operative sections of the Customs Act 1901 (the Act) relevant to Tariff Concession Orders (TCOs) are sections 269C, 269B, 269D, 269E, 269F, 269P, 269SJ, and 269K. Section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a TCO in respect of goods, provided the goods are not specified in section 269SJ. If the application meets the core criteria in section 269C, which requires that no substitutable goods were produced in Australia in the ordinary course of business, the CEO must make a written order declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. This results in the application of a lower rate of customs duty, or in some cases, free duty, as specified in the TCO.
The obligations imposed on parties by the Act include the requirement for applicants to ensure their application is not in respect of goods specified in section 269SJ and that they meet the core criteria set out in section 269C. The CEO is required to publish a notice in the Gazette inviting submissions on the TCO application as per section 269K(1). The CEO must also decide whether the application meets the core criteria and, if satisfied, make a written TCO as per section 269P(3). The TCO provides clarity on the duty rates applicable to the specified goods and the conditions under which the concession applies.
Offences and penalties are not explicitly detailed in the provided excerpt. However, failure to comply with the requirements of the Act or the TCO could result in legal consequences, such as disputes over duty refunds or the imposition of incorrect duty rates. The Act likely includes provisions for penalties in cases of non-compliance, though specific penalties are not mentioned in this particular TCO. The Customs Act 1901 would need to be consulted for detailed information on penalties and enforcement mechanisms.