EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0800050
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.
Autotecnica Imports Pty Ltd applied for a TCO in respect of certain boat covers on 02 January 2008.
Instrument
TCO No 0800050 was made on 25 March 2008. It declares that those certain boat covers 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 7.5%. 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. 0800050 is taken to have come into force on 02 January 2008.
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. 0800050, made under the Customs Act 1901, was introduced to provide tariff concessions for specific goods, thereby addressing the need to lower customs duties for certain imported items. Enacted by the Chief Executive Officer of Customs, this instrument specifically targets the application for tariff concessions concerning boat covers, ensuring that these goods benefit from a duty-free rate under the Customs Tariff Act 1995. The policy objective is to facilitate the importation of goods that are not produced domestically, thereby supporting trade and economic efficiency. The instrument came into effect on the date of the application, 02 January 2008, and does not disadvantage any existing rights or impose new liabilities on persons other than the Commonwealth.
Scope and Application
The Customs Act 1901, through its Part XVA, facilitates the establishment of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. These orders apply to specific goods that are subject to lower rates of customs duty, provided the application for the concession meets certain criteria, including the absence of substitutable goods produced in Australia in the ordinary course of business. The scope of the Act applies to any person or entity seeking a reduction in customs duty for particular goods, ensuring the goods are not specified as ineligible under section 269SJ of the Act. The geographical jurisdiction of the Act is national, as it falls under the Commonwealth's legislative power. The application process requires the CEO to publish a notice in the Gazette inviting submissions, though in the case of TCO No. 0800050, no objections were received. The commencement date of a TCO aligns with the date the application was lodged, meaning TCO No. 0800050 is effective from 2 January 2008. Importantly, the TCO does not affect existing rights or impose new liabilities on persons other than the Commonwealth, thus protecting those who imported the goods prior to the concession date.
Key Provisions
The Tariff Concession Instrument No. 0800050 under the Customs Act 1901 (section 269F) pertains to an application made by Autotecnica Imports Pty Ltd for a Tariff Concession Order (TCO) in relation to certain boat covers. Section 269C specifies that a TCO can be granted if, on the date of application, there were no substitutable goods produced in Australia in the ordinary course of business. The CEO of Customs must assess whether the application meets these core criteria (section 269P(3)), and if satisfied, the CEO issues a written order (section 269P(3)) reducing the duty on these goods to free. This is in contrast to the general rate of duty of 7.5% applicable to such goods.
In terms of obligations, 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 made. However, in this instance, no submissions were received. Additionally, section 269S(1) stipulates that the TCO is effective from the date the application was lodged, which, for TCO No. 0800050, is 02 January 2008. This means that the concession applies retroactively from the date of application, but without affecting the rights or imposing liabilities on any person other than the Commonwealth prior to the date of registration.
In the event of a breach of any provisions within the Customs Act 1901, various penalties and consequences may apply. The Act does not specify particular offences related to TCOs but generally includes provisions for penalties under sections such as 275 and 276. Section 275 outlines penalties for offences related to the importation of dutiable goods without paying duty or evading duty, with potential criminal penalties including fines up to $22,000 or imprisonment for up to two years, or both. Under section 276, penalties for offences related to false statements or documents can result in fines up to $11,000 or imprisonment for up to one year, or both. These maximum penalties underscore the seriousness with which the Act treats non-compliance.