EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0804161
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.
Jonsa Ellies Pty Ltd applied for a TCO in respect of certain audio video cable on 14 March 2008.
Instrument
TCO No 0804161 was made on 30 May 2008. It declares that those certain audio video cable 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. 0804161 is taken to have come into force on 14 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. 0804161, enacted in 2008, is an instrument under the Customs Act 1901. It was introduced to address the need for tariff concessions on certain goods that are not produced in Australia, thereby ensuring that Australian consumers and businesses can access these goods at a reduced customs duty rate. This instrument was made by the Chief Executive Officer of Customs, in accordance with the authority provided under section 269F of the Customs Act 1901. The policy objective is to facilitate the importation of goods that are not domestically produced, thereby supporting trade and potentially lowering costs for consumers and businesses. Jonsa Ellies Pty Ltd applied for this concession in respect of certain audio video cables, and the instrument was enacted after determining that no substitutable goods were produced in Australia, thus meeting the core criteria set out in the Act.
Scope and Application
The Customs Act 1901, specifically under Part XVA, governs the establishment of Tariff Concession Orders (TCOs) which provide for a lower rate of customs duty on specified goods. The Act applies to individuals and entities seeking to import goods that are subject to a TCO, thereby reducing their customs duty obligations. The geographic reach of this legislation is national, applying throughout Australia, as it pertains to the importation of goods across the country. The Act excludes certain goods from being subject to a TCO, specifically those listed in section 269SJ, and requires that no substitutable goods are produced in Australia on the day the application was lodged. The Act allows for the CEO to make subsidiary instruments to further define terms such as 'substitutable goods' and 'ordinary course of business'. The Tariff Concession Instrument No. 0804161 applies to certain audio video cables and reduces their duty from the general rate of 5% to free, effective from the date the application was lodged, 14 March 2008.
Key Provisions
The Tariff Concession Order (TCO) No. 0804161 under the Customs Act 1901 applies to certain audio video cables, reducing the duty on these goods from the general rate of 5% to free. This is pursuant to section 269P(3) of the Act, which mandates that if the Chief Executive Officer (CEO) of Customs is satisfied that an application for a TCO meets the core criteria, they must issue a written order. This order declares that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. The CEO must also ensure that the application does not relate to goods specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO.
The Act imposes several obligations on the parties involved. Firstly, applicants like Jonsa Ellies Pty Ltd must submit a valid application to the CEO, ensuring it does not pertain to restricted goods. The CEO, upon receiving an application, must determine if it meets the core criteria as specified in section 269C, which includes verifying that no substitutable goods are produced in Australia in the ordinary course of business, as defined by sections 269D and 269E of the Act. Additionally, the CEO must publish a notice in the Gazette, inviting submissions from any person who may have reasons to oppose the TCO. If no submissions are received, the CEO proceeds to issue the TCO.
Non-compliance with the provisions of the Customs Act 1901 can result in significant legal consequences. For instance, any person who knowingly or negligently contravenes the Act may face civil or criminal penalties. Under section 269S of the Act, a TCO is effective from the date the application is lodged, thus any failure to adhere to the prescribed procedures or misrepresentation of facts in the application can lead to enforcement actions. The penalties for such breaches can include fines and, in more severe cases, imprisonment, depending on the nature and severity of the breach.
The TCO No. 0804161 ensures that it does not affect the rights of any person, except the Commonwealth, as at the date of registration. This means that it does not disadvantage or impose liabilities on anyone in respect of actions taken prior to the date of registration. However, the rights of importers are beneficially affected, allowing them to apply for a refund of duty on goods imported since the TCO came into force. Importantly, the TCO does not impose any new liabilities on any person, ensuring that it only alters the tariff rate without imposing additional burdens.