EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0800903
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 oven and or griller parts on 15 January 2008.
Instrument
TCO No 0800903 was made on 28 March 2008. It declares that those certain oven and or griller 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. 0800903 is taken to have come into force on 15 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. 0800903, enacted in 2008, amends the Customs Act 1901 to provide tariff concessions for certain goods, specifically oven and griller parts, by reducing the customs duty on these items from the general rate of 5% to free. This legislative instrument was introduced to address the economic disadvantage faced by Australian importers of these specific goods, aiming to enhance competitiveness and accessibility of such products in the domestic market. The instrument was enacted by the Australian Government and follows the process outlined in the Customs Act 1901, which allows the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) when specific criteria are met, ensuring that the goods are not substitutable by products manufactured within Australia. The policy objective behind this measure is to support Australian industries by providing tariff relief on certain imported goods, thereby reducing costs and potentially lowering consumer prices.
Scope and Application
The Tariff Concession Instrument No. 0800903, made under the Customs Act 1901, applies specifically to the concessions granted to certain oven and griller parts, which are subject to a lower rate of customs duty than the general rate. This legislation pertains to entities or individuals importing these specified parts into Australia. The application of this concession is effective from the date the application was lodged, in this case, 15 January 2008, and it is governed by the core criteria stipulated in the Customs Act, particularly sections 269C and 269SJ. The geographic reach of this Act is national, applying across all states and territories of Australia. The CEO of Customs, who must be satisfied that no substitutable goods were produced in Australia in the ordinary course of business, is the authority responsible for making these tariff concession orders. The TCO does not disadvantage any person or impose liabilities for actions taken before its registration. Furthermore, while the Act provides for the potential extension of its application through subordinate instruments, this particular TCO No. 0800903 stands independently without reference to further legislative instruments.
Key Provisions
The Customs Act 1901 (the Act) allows for the creation of Tariff Concession Orders (TCOs) through which a lower rate of customs duty can be applied to certain goods (s 269F). When a party such as Electrolux Home Products Pty Limited applies for a TCO, the Chief Executive Officer of Customs (the CEO) must consider whether the application meets the core criteria, primarily whether substitutable goods are produced in Australia (s 269C). If the CEO determines that the application satisfies these criteria, a written order is made declaring the goods to which the concession applies (s 269P(3)).
The obligations imposed by the Act on the CEO include assessing whether the application meets the core criteria and publishing a notice in the Gazette inviting any interested parties to submit objections (s 269K(1)). In this case, no submissions were received. The Act also mandates that the TCO comes into force on the date the application was lodged (s 269S(1)), meaning that the TCO No. 0800903, which concerns certain oven and griller parts, is effective from 15 January 2008. Importantly, the Act ensures that the TCO does not retroactively disadvantage any person or impose liabilities on them for actions taken before the registration date (s 269S(2)).
In terms of consequences for breach, the Act does not explicitly outline specific offences or penalties for non-compliance with the TCO provisions. However, any actions taken in violation of the terms of the TCO or the Customs Act itself could potentially be subject to civil or criminal penalties under other relevant sections of the Act or associated regulations. For example, fraudulent claims for tariff concessions could lead to penalties under sections pertaining to false statements or fraudulent conduct.
Given that the TCO does not disadvantage any person and does not impose new liabilities, the primary enforcement mechanism would be ensuring compliance with the terms of the concession. Any misuse of the tariff concession or circumvention of the intended purpose could result in administrative or legal actions, though specific penalties would depend on the nature and extent of the breach.