EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0829886
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.
Hpm Industries Pty Ltd applied for a TCO in respect of certain device switches on 05 September 2008.
Instrument
TCO No 0829886 was made on 28 November 2008. It declares that those certain device switches 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. 0829886 is taken to have come into force on 05 September 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 the legal framework for the regulation of customs and excise in Australia. One aspect of this framework is the scheme for Tariff Concession Orders (TCOs) under Part XVA of the Act, introduced to address the need for tariff concessions on certain imported goods where no suitable Australian-made alternatives exist. The 2008 Tariff Concession Instrument No. 0829886 exemplifies this scheme's operation, as it grants tariff concessions on specific device switches following an application by Hpm Industries Pty Ltd. This instrument was made to provide tariff relief to importers of these switches, effectively reducing the duty rate from 5% to free, provided the CEO was satisfied that no substitutable goods were produced in Australia. The policy objective here is to encourage trade and economic efficiency by ensuring that Australian consumers and businesses have access to competitively priced goods where Australian production does not meet the demand.
Scope and Application
The Tariff Concession Instrument No. 0829886 under the Customs Act 1901 applies to individuals or entities that have applied for tariff concessions on certain goods, specifically device switches in this case. The Act's scope is national as it operates under the Commonwealth's jurisdiction, with the Chief Executive Officer of Customs being the authority responsible for making decisions on tariff concessions. The Act applies to any application for a Tariff Concession Order (TCO) made under section 269F of the Act, provided the application meets the core criteria set out in sections 269C, 269D, and 269E, and does not pertain to goods listed in section 269SJ, which are ineligible for tariff concessions. The application process requires public notification to allow interested parties to voice their opinions, although no objections were raised in this instance. The TCO in question came into force on the date the application was lodged, 5 September 2008, and it does not retroactively affect the rights or impose any liabilities on individuals or entities, except for potentially granting benefits such as duty refunds to importers of the specified goods.
Key Provisions
The main operative sections of this legislation pertain to Tariff Concession Orders (TCOs) under Part XVA of the Customs Act 1901. Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of goods, provided the goods do not fall under the list specified in section 269SJ. The CEO must then determine if the application meets the core criteria as outlined in section 269C, which requires that no substitutable goods are produced in Australia in the ordinary course of business on the day the application was lodged. If the CEO is satisfied that the application meets these criteria, they must issue a written order under section 269P(3), declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The obligations and requirements imposed by this Act on the parties involved primarily concern the process of applying for and issuing a TCO. The CEO of Customs has the responsibility to assess applications to ensure they meet the specified criteria. This includes verifying that no substitutable goods are produced in Australia in the ordinary course of business. Once a TCO is issued, it applies to the goods from the date the application was lodged, as stipulated in subsection 269S(1). Additionally, the CEO is required to publish a notice in the Gazette inviting any interested parties to submit their views on the proposed TCO, as per subsection 269K(1). In this instance, the CEO did not receive any submissions opposing the TCO for device switches.
There are no specific offences, penalties, or civil/criminal consequences mentioned for breach of the provisions in this particular TCO. However, the broader Customs Act 1901 and associated regulations do provide for various offences and penalties for non-compliance with customs laws. For example, penalties for providing false or misleading information can include fines up to $22,200 for individuals and significantly higher amounts for corporations, along with potential imprisonment terms. Similarly, penalties for failing to declare goods correctly can result in fines and penalties calculated based on the value of the goods and the nature of the offence. While these penalties are not explicitly mentioned in the TCO, they are relevant under the general framework of the Customs Act.