EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0804044
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.
Hagemeyer Brands Pty Ltd applied for a TCO in respect of certain cooktops not including ovens on 18 March 2008.
Instrument
TCO No 0804044 was made on 06 June 2008. It declares that those certain cooktops not including ovens 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. 0804044 is taken to have come into force on 18 March 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. 0804044, enacted under the Customs Act 1901, addresses the gap in tariff concessions for specific imported goods, allowing for reduced customs duty rates. The Tariff Concession Orders (TCO) scheme, outlined in Part XVA of the Customs Act, allows the Chief Executive Officer of Customs to apply lower customs duty rates on goods that meet certain criteria, specifically when no substitutable goods are produced in Australia. Hagemeyer Brands Pty Ltd's application for a TCO concerning certain cooktops not including ovens led to the creation of TCO No. 0804044, which was published in the Gazette and came into effect on 18 March 2008. This instrument declares that these particular cooktops are subject to a zero percent duty rate, a significant reduction from the general rate of 5%. The policy objective here is to support the importation of these goods, benefiting importers by allowing them to apply for a refund of duty on goods imported since the TCO's effective date.
Scope and Application
The Tariff Concession Instrument No. 0804044 under the Customs Act 1901 applies to individuals or entities seeking tariff concessions for specific goods, in this case, certain cooktops not including ovens, by applying for a Tariff Concession Order (TCO). The Act allows for the reduction of customs duty on goods provided they meet the core criteria set out in the Act, such as the absence of substitutable goods produced in Australia in the ordinary course of business. The instrument is issued by the Chief Executive Officer of Customs, who evaluates the application and determines if it meets the stipulated conditions. This TCO applies nationally across Australia and becomes effective on the date the application is lodged, in this instance, 18 March 2008. Notably, the TCO does not adversely affect any pre-existing rights of persons other than the Commonwealth and does not impose any new liabilities. It provides benefits to importers by allowing them to claim refunds for duties paid on the specified goods since the TCO’s effective date. The application of this TCO is further refined and potentially extended through subordinate instruments, which may detail specific procedural or eligibility aspects.
Key Provisions
The Tariff Concession Order No. 0804044 under the Customs Act 1901 provides a reduced customs duty rate for certain cooktops not including ovens. This instrument was made following an application by Hagemeyer Brands Pty Ltd on 18 March 2008. Section 269F of the Act permits a person to apply to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO) if certain criteria are met. If the CEO determines that the application complies with the core criteria set out in sections 269C and 269D of the Act, they must make a TCO, as provided in section 269P(3). In this case, the CEO found that no substitutable goods were produced in Australia, thereby satisfying the core criteria.
The obligations imposed by this Act on the parties involved include the requirement for the CEO to publish a notice in the Gazette inviting submissions from any person who might oppose the making of the TCO. This process is mandated by subsection 269K(1) of the Act. In this instance, the CEO did not receive any submissions against the TCO. Additionally, the Act mandates that the TCO should be taken to have come into force on the date the application was lodged, which in this case was 18 March 2008. Importantly, the TCO does not affect any pre-existing rights or impose any liabilities on persons other than the Commonwealth, as stipulated by subsection 269S(1) and paragraph 126(1)(r) of the Regulations.
The Act also outlines consequences for non-compliance, though specific offences and penalties are not detailed in the explanatory statement. Generally, breaches of the Customs Act 1901 may result in civil or criminal penalties, including fines and imprisonment, depending on the severity and nature of the breach. The maximum penalties for offences under the Customs Act can vary widely, but they often include substantial fines and imprisonment terms that reflect the seriousness of the contravention. The specific penalties applicable in any given case would depend on the particular provisions of the Act and the circumstances of the breach.