EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0830749
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.
Ozito Industries Pty Ltd applied for a TCO in respect of certain garden shredder on 10 September 2008.
Instrument
TCO No 0830749 was made on 05 December 2008. It declares that those certain garden shredder 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. 0830749 is taken to have come into force on 10 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 was enacted to provide a comprehensive framework for the administration of customs and excise duties in Australia. The Tariff Concession Instrument No. 0830749, made under the Customs Act 1901, addresses the issue of granting tariff concessions for specific goods that are not produced in Australia. This instrument was introduced to facilitate the importation of goods by reducing or eliminating customs duties on items that are not manufactured domestically, thereby encouraging trade and providing benefits to importers. The instrument was enacted by the Chief Executive Officer of Customs following a valid application from Ozito Industries Pty Ltd for a tariff concession on certain garden shredders, and it came into force on 10 September 2008. The objective of this specific tariff concession is to ensure that the importation of these goods is not hindered by prohibitive customs duties, while also ensuring that no existing rights or liabilities of non-Commonwealth persons are adversely affected.
Scope and Application
The Tariff Concession Instrument No. 0830749 under the Customs Act 1901 applies specifically to certain garden shredders, as submitted for consideration by Ozito Industries Pty Ltd. This Act facilitates the application process for Tariff Concession Orders (TCO) by which the Chief Executive Officer of Customs (CEO) can reduce the rate of customs duty on specified goods. The legislation is designed to apply when the CEO determines that no substitutable goods are being produced in Australia in the ordinary course of business. The concession is applicable to the general rate of duty on these goods, which has been reduced from 5% to free under this particular order. The scope of this Act extends to any entity or individual involved in the importation of the specified goods, directly influencing their duty obligations and potential refunds. The application of the TCO is national in scope, reflecting its reach across the Commonwealth of Australia. Notably, the Act excludes certain goods specified under section 269SJ of the Customs Act 1901, which cannot be subject to a TCO. The application process includes a mandatory publication in the Gazette, inviting public submissions on the proposed concession, although in this instance, no submissions were received. The TCO is effective from the date the application was lodged, without retroactively affecting any pre-existing rights or liabilities of entities other than the Commonwealth.
Key Provisions
The Tariff Concession Instrument No. 0830749, under the Customs Act 1901, establishes a mechanism for applying lower customs duty rates to specific goods through Tariff Concession Orders (TCOs). Section 269F of the Act permits an application for a TCO, provided the goods are not specified in section 269SJ, which lists goods ineligible for a TCO. The Chief Executive Officer (CEO) of Customs must decide if the application meets the core criteria outlined in section 269C, which requires that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged.
The obligations imposed by the Act on parties include the requirement for the CEO to assess TCO applications and ensure they meet the criteria set out in section 269C. The CEO must also ensure that any substitutable goods produced in Australia are identified, as per section 269D, and that the goods in question are not produced in the ordinary course of business as defined in section 269E. The CEO must make a written order if satisfied that the application meets the core criteria, as mandated by section 269P(3).
Failure to comply with the Act's provisions can lead to civil or criminal consequences. While the explanatory statement does not explicitly mention penalties, breaches of the Customs Act 1901 can result in significant penalties, including fines and imprisonment, depending on the severity and intent of the breach. Under section 272, a person who contravenes the Act may be liable for a penalty, which can be severe, especially for repeated or intentional violations. For instance, section 273 of the Act allows for a penalty of up to 10,000 penalty units for serious breaches. The CEO's role in enforcing the Act is critical, and any failure to adhere to the specified requirements can result in these penalties being imposed.