EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0828777
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.
Lisec Australia Pty Ltd applied for a TCO in respect of certain glass sheet loading system on 29 August 2008.
Instrument
TCO No 0828777 was made on 21 November 2008. It declares that those certain glass sheet loading system 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. 0828777 is taken to have come into force on 29 August 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 enacted to facilitate trade by providing a structured approach to the regulation of customs and excise duties. The legislation, enacted by the Parliament of Australia, aims to streamline customs procedures and provide clear guidelines for the imposition and remission of duties. A specific issue the Act addresses is the facilitation of trade for certain imported goods by allowing tariff concession orders (TCOs) that can lower the customs duty on specified goods. This is achieved through Part XVA of the Act, which empowers the Chief Executive Officer of Customs to make TCOs under certain conditions. The policy objective behind these concessions is to support economic efficiency by reducing the cost of importing certain goods, thereby encouraging trade and potentially benefiting consumers through lower prices.
The Tariff Concession Instrument No. 0828777, published under the Customs Act 1901, was introduced to provide a tariff concession for certain glass sheet loading systems. The instrument was made on 21 November 2008, following an application by Lisec Australia Pty Ltd on 29 August 2008. The CEO of Customs determined that no substitutable goods were produced in Australia, thus meeting the core criteria for a TCO. Consequently, the instrument declares that these specific glass sheet loading systems are subject to a duty rate of free, as opposed to the general rate of 5%. The instrument came into effect on the date the application was lodged, 29 August 2008, and does not affect any pre-existing rights or impose any new liabilities on persons other than the Commonwealth. Importers of these goods can apply for a refund of duty paid since the effective date of the concession.
Scope and Application
The Tariff Concession Instrument No. 0828777 under the Customs Act 1901 applies to specific goods, in this case certain glass sheet loading systems, as determined by the Chief Executive Officer of Customs (CEO). This Act operates on a Commonwealth level, facilitating tariff concessions for goods that meet the specified criteria and have no substitutable goods produced in Australia. The primary objective of this legislation is to provide a lower rate of customs duty for the specified goods, thereby benefiting importers by potentially reducing their duty costs. The CEO's decision to grant a tariff concession order (TCO) is contingent on satisfying core criteria, including the absence of substitutable goods being produced in Australia. The TCO does not affect pre-existing rights or impose liabilities on individuals or entities other than the Commonwealth, ensuring that the concession does not disadvantage those who were unaware of the impending tariff changes. The instrument is effective from the date the application was lodged, allowing for immediate application of the tariff concessions.
Key Provisions
The main operative sections of this legislation (F2009L00374) pertain to Tariff Concession Orders (TCOs) under Part XVA of the Customs Act 1901 (section 269F). When a person applies to the Chief Executive Officer of Customs (CEO) for a TCO in respect of certain goods, the CEO must assess whether the application meets the core criteria (section 269C). If the CEO is satisfied that the application meets these criteria, which include that no substitutable goods are produced in Australia in the ordinary course of business (section 269D and 269E), a written order is made declaring the goods subject to a prescribed rate of duty (subsection 269P(3)). In this instance, Tariff Concession Order No. 0828777 was made on 21 November 2008, declaring that certain glass sheet loading systems are goods to which item 50 of Schedule 4 to the Customs Tariff Act 1995 applies, with a duty rate of free, instead of the general rate of 5%.
The Act imposes several obligations on the parties involved. The CEO is required to publish a notice in the Gazette as soon as practicable after accepting a TCO application, inviting any person who considers there are reasons why the TCO should not be made to lodge a submission (subsection 269K(1)). The CEO must also decide whether the application meets the core criteria and ensure that the goods subject to the TCO do not have substitutable goods produced in Australia (section 269C and 269P(3)). Additionally, the CEO must ensure that 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 (subsection 269S(1)). The TCO allows importers of such goods to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force.
Any breach of the conditions set out in the Tariff Concession Order No. 0828777 may result in civil or criminal consequences. While the legislation does not explicitly state maximum penalties for breach, general provisions of the Customs Act 1901 apply, which may include fines and imprisonment. The consequences of non-compliance may also include the imposition of duties on the goods subject to the TCO, as well as potential legal action from affected parties. It is important for all parties involved to adhere to the terms and conditions of the TCO to avoid any negative consequences.