EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0806087
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.
Moffat Pty Limited applied for a TCO in respect of certain delivery and or dispensing trolleys on 30 April 2008.
Instrument
TCO No 0806087 was made on 18 July 2008. It declares that those certain delivery and or dispensing trolleys 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. 0806087 is taken to have come into force on 30 April 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, enacted by the Australian Parliament, provides for a scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (CEO). The objective of this scheme, as detailed in Part XVA of the Act, is to apply lower rates of customs duty on goods that are the subject of a TCO. This mechanism is designed to encourage the importation of certain goods by reducing their tariff rates when it is determined that no substitutable goods are produced in Australia. The Act facilitates applications for TCOs and mandates the CEO to make a written order if the application meets specified criteria, such as the absence of substitutable goods produced in Australia. The process aims to balance economic benefits with the protection of local industries by ensuring that tariff concessions are granted judiciously.
Scope and Application
The Tariff Concession Instrument No. 0806087 under the Customs Act 1901 applies to certain delivery and dispensing trolleys as designated by the instrument, providing these goods with a free rate of duty as opposed to the general rate of 5%. This instrument is specifically tailored for entities and individuals importing these goods into Australia, and it is applicable nationally across the Commonwealth. The instrument extends its application by granting tariff concessions to specific goods, thereby reducing the customs duty applicable to them, and it operates within the framework established by the Customs Act 1901. This act does not affect any pre-existing rights or liabilities incurred prior to its registration date, ensuring that the rights of importers are beneficially affected, particularly in their ability to apply for refunds of duty on goods imported since the effective date of the tariff concession. The instrument does not specify any exclusions or exemptions and is effective from the date the application was lodged, 30 April 2008.
Key Provisions
The key provisions of the Tariff Concession Instrument No. 0806087 under the Customs Act 1901 (section 269F) allow for the application of tariff concessions on certain goods. Specifically, section 269F enables a person to apply to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO). If the CEO is satisfied that the application is not for goods specified in section 269SJ, which are ineligible for TCOs, the CEO must assess whether the application meets the core criteria outlined in section 269C. This requires the CEO to determine if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business, as defined in section 269E.
The obligations imposed by the Act on the parties involved are primarily on the CEO of Customs. Upon receiving a valid TCO application, the CEO must decide if the application meets the core criteria (section 269C). If satisfied, the CEO must make a written TCO (section 269P(3)), specifying the prescribed item of Schedule 4 to the Customs Tariff Act 1995 that applies to the goods in question. In this case, the CEO determined that Moffat Pty Limited's application for certain delivery and dispensing trolleys met the criteria, resulting in TCO No. 0806087.
Additionally, the Act mandates the CEO to publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made (subsection 269K(1)). If no submissions are received, as in this instance, the TCO can proceed without further objections. The TCO is deemed to come into force on the date the application was lodged (subsection 269S(1)), ensuring that the rights of importers are beneficially affected, allowing them to apply for duty refunds on imports since that date (paragraph 126(1)(r) of the Regulations).
Regarding consequences for breach, the Act does not explicitly detail offences or penalties for non-compliance with the TCO provisions. However, failure to adhere to the conditions set by a TCO could potentially lead to disputes or legal challenges regarding the legitimacy of the concession or the eligibility of the goods. Importers or entities involved in the importation of goods subject to a TCO must ensure they comply with the conditions and requirements stipulated by the TCO to avoid any legal ramifications.