EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0802707
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.
Major Electrical Appliances applied for a TCO in respect of certain washing machines on 15 February 2008.
Instrument
TCO No 0802707 was made on 28 April 2008. It declares that those certain washing machines 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. 0802707 is taken to have come into force on 15 February 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 Customs Act 1901 was amended to include provisions for Tariff Concession Orders (TCOs) through Part XVA, enacted to address the need for reducing customs duty on specific imported goods that are not produced domestically. The Tariff Concession Instrument No. 0802707 was introduced to provide tariff concessions on certain washing machines, effectively reducing their customs duty from 5% to free, as no substitutable goods were produced in Australia at the time of application. This instrument was enacted by the Chief Executive Officer of Customs in accordance with the Customs Act 1901 and aims to facilitate the import of these goods by providing financial relief to importers and consumers. The instrument was published in the Gazette, inviting public submissions, though none were received. The TCO is effective from the date the application was lodged, ensuring no retroactive disadvantage to importers, and allows for duty refunds on imports since that date.
Scope and Application
The Tariff Concession Instrument No. 0802707 under the Customs Act 1901 applies to specific washing machines, granting them tariff concessions in the form of a reduction in customs duty rates. This legislation targets goods that are subject to a Tariff Concession Order (TCO), with the TCO application process overseen by the Chief Executive Officer of Customs (CEO). For the purposes of this legislation, the scope is limited to goods that are not specified in section 269SJ of the Customs Act 1901 and meet the core criteria outlined in section 269C, which requires that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. The instrument extends its reach nationally within Australia, applying to any washing machines that qualify under the specified conditions, and it does not disadvantage any existing rights of persons other than the Commonwealth. The TCO does not impose any liabilities on individuals or entities, and any existing rights or liabilities of importers remain unaffected by this concession. The instrument also does not create new obligations or liabilities, ensuring that the application of the concession does not adversely affect existing legal rights or financial obligations.
Key Provisions
The primary operative sections of Tariff Concession Instrument No. 0802707, made under the Customs Act 1901, focus on the establishment of a Tariff Concession Order (TCO) for specific washing machines. Section 269F of the Act allows an individual or entity to apply for a TCO, provided the goods in question do not fall under the list of prohibited goods as outlined in section 269SJ. If the application is deemed valid, the Chief Executive Officer (CEO) of Customs is required to assess whether the application meets the core criteria specified in section 269C, which involves ensuring no substitutable goods are produced in Australia at the time of the application. If the CEO determines that the application meets these criteria, a written TCO is issued, as stipulated in section 269P(3), specifying that the goods in question are subject to a lower customs duty rate.
The obligations imposed by the Act on the parties involved are primarily centered around the application and assessment process for TCOs. The CEO must publish a notice in the Gazette inviting any interested parties to submit objections to the TCO if they believe it should not be granted, as required by section 269K(1). This ensures transparency and allows for public input before a decision is made. Moreover, the CEO must ensure that the application meets the core criteria and that no substitutable goods are produced in Australia, as outlined in sections 269C and 269D respectively. The Act also mandates that any TCO made does not adversely affect the rights of individuals or entities, except the Commonwealth, concerning actions taken prior to the TCO's registration.
Any breaches of the conditions set forth in the Customs Act 1901 or the associated regulations could result in various consequences. While the specific penalties for breach are not detailed in the explanatory statement, the general framework of the Act implies that violations could lead to civil or criminal penalties. For instance, incorrect declaration of goods, failure to comply with the Act's provisions, or any fraudulent activities related to customs duty could attract significant fines or even imprisonment, depending on the severity of the breach. The exact penalties would be determined by the courts based on the specific circumstances of the case and the relevant sections of the Act.