EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0719766
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.
Doppelmayr Australia Pty Ltd applied for a TCO in respect of certain ski lift parts on 22 November 2007.
Instrument
TCO No 0719766 was made on 29 February 2008. It declares that those certain ski lift 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. 0719766 is taken to have come into force on 22 November 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. 0719766, enacted in 2008, pertains to the Customs Act 1901, addressing the need for a mechanism by which the Chief Executive Officer of Customs can grant tariff concessions on specific goods. This legislative instrument enables the application of a lower rate of customs duty on goods that are the subject of a Tariff Concession Order (TCO), provided that certain core criteria are met. The primary objective of this instrument is to provide tariff relief on goods for which no substitutable products are produced domestically, thereby encouraging the importation of goods that are not readily available in the Australian market and potentially fostering competition and innovation.
This instrument was enacted by the relevant federal legislature to streamline the process for applying for tariff concessions, ensuring that businesses can more easily access the benefits of reduced customs duties on specific goods. The policy objective is to facilitate the import of goods that cannot be produced in Australia, thus supporting economic efficiency and consumer choice without imposing any additional liabilities or disadvantaging existing rights holders.
Scope and Application
The Tariff Concession Instrument No. 0719766 under the Customs Act 1901 applies to the concession of customs duties on certain ski lift parts, specifically those designated by Doppelmayr Australia Pty Ltd. The application of this Act pertains to the Chief Executive Officer of Customs, who is responsible for determining whether an application for a Tariff Concession Order (TCO) meets the core criteria set out in the Act. This legislation is applicable to entities and individuals involved in the importation of these specific ski lift parts. The geographic scope of the Act is national, as it falls under the Commonwealth's jurisdiction, and extends to all imports of the specified goods within Australia. Exclusions from the application of this Act include any goods specified in section 269SJ of the Act, which outlines goods that cannot be subject to a TCO. Additionally, the Act does not affect any existing rights or liabilities of persons other than the Commonwealth, ensuring that the rights of importers are beneficially impacted by the concession.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 0719766 under the Customs Act 1901 (section 269C) outline the conditions for granting a Tariff Concession Order (TCO). Specifically, section 269C stipulates that a TCO may be granted if, on the day the application is lodged, no substitutable goods were produced in Australia in the ordinary course of business. A substitutable good, as defined in section 269D, refers to goods produced in Australia that could potentially be used in the same way as the goods for which the TCO is sought. Additionally, section 269P(3) mandates that if the Chief Executive Officer (CEO) of Customs is satisfied that the application meets the core criteria, they must issue a written order declaring that the goods in question are subject to a specified item in Schedule 4 of the Customs Tariff Act 1995, resulting in a reduction of customs duty.
The Act imposes several obligations on the parties involved. Firstly, section 269F allows a person to apply to the CEO for a TCO in respect of goods. Upon receiving an application, the CEO must determine whether it meets the core criteria, as outlined in section 269C. If satisfied, the CEO must proceed to make a TCO as per section 269P(3). Furthermore, section 269K(1) requires the CEO to publish a notice in the Gazette, inviting any interested parties to submit objections if they believe the TCO should not be granted. In this instance, no submissions were received, and the TCO was approved accordingly.
The Act also outlines potential consequences for non-compliance. However, this particular TCO does not impose any new liabilities on any person, including importers. Instead, it offers benefits to importers by allowing them to apply for a refund of duty on goods imported since the TCO was taken to have come into force, under paragraph 126(1)(r) of the Regulations. The TCO ensures that no existing rights of a person (other than the Commonwealth) are adversely affected or impose liabilities in respect of actions taken before the TCO's registration date.
In summary, the Tariff Concession Instrument No. 0719766 provides a streamlined process for obtaining reduced customs duties on specified goods, provided that no substitutable goods are produced in Australia. The CEO must follow specific procedural steps, including publishing a notice in the Gazette and considering any submissions received. While the TCO itself does not impose new liabilities, it does afford benefits to importers by allowing them to claim refunds for duties paid on imported goods since the TCO's effective date.