EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0831327
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.
David Bartlett Enterprises Pty Ltd applied for a TCO in respect of certain electric accumulators on 16 September 2008.
Instrument
TCO No 0831327 was made on 11 March 2009. It declares that those certain electric accumulators 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. One submission objecting to the TCO application was received from Saft Batteries Pty Ltd.
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. 0831327 is taken to have come into force on 16 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 Tariff Concession Instrument No. 0831327 was enacted in 2009 under the Customs Act 1901 to address the issue of facilitating the importation of specific goods by reducing their customs duty rates. This instrument was developed in response to an application by David Bartlett Enterprises Pty Ltd for tariff concessions on certain electric accumulators, aiming to provide economic benefits by lowering the duty from the general rate of 5% to a rate of free. The instrument was made by the Chief Executive Officer of Customs, who determined that the application met the core criteria and that no substitutable goods were produced in Australia. The Tariff Concession Order was published in the Gazette, inviting objections, but no objections were lodged beyond the one from Saft Batteries Pty Ltd. The order came into effect on the date the application was lodged, 16 September 2008, ensuring that it does not adversely affect the rights of persons other than the Commonwealth, and allows for duty refunds for importers of the specified goods.
Scope and Application
The Tariff Concession Instrument No. 0831327 applies to goods, specifically certain electric accumulators, which are the subject of a Tariff Concession Order (TCO) as per the Customs Act 1901. The Act pertains to the application process overseen by the Chief Executive Officer of Customs, who evaluates whether the application meets the specified core criteria for tariff concession. The geographic reach of this legislation is national, as it operates under the federal framework of the Commonwealth of Australia. The Act's application is not restricted to particular entities or industries but rather to goods that are not produced in Australia and do not have substitutable alternatives. Exclusions under section 269SJ of the Act ensure that certain goods, typically those that could potentially be produced domestically, are not eligible for tariff concessions. The Instrument was made effective from the date the application was lodged, 16 September 2008, and does not retroactively affect the rights of any person or impose any liabilities prior to its commencement. This Act extends its application through subordinate instruments such as the Customs Tariff Act 1995, which details the specific tariff rates applicable to the goods subject to the TCO.
Key Provisions
The Customs Act 1901, as amended by Tariff Concession Order (TCO) No. 0831327, outlines the process by which the Chief Executive Officer of Customs (CEO) can grant tariff concessions on specific goods. According to section 269F, an individual or entity can apply for a TCO if the goods in question do not fall under the categories specified in section 269SJ. The CEO must then assess whether the application meets the core criteria outlined in section 269C. Specifically, the CEO must be satisfied that no substitutable goods were produced in Australia on the day the application was lodged, as defined in sections 269D and 269E. If these conditions are met, the CEO must issue a written order declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, as indicated in section 269P(3).
In the case of TCO No. 0831327, the CEO granted a tariff concession on certain electric accumulators, reducing their duty from 5% to free. This decision followed David Bartlett Enterprises Pty Ltd's application on 16 September 2008, and the TCO came into force on that same date. The CEO's decision was made after considering an objection from Saft Batteries Pty Ltd, which was invited to submit its views as per subsection 269K(1) of the Act. Despite the objection, the CEO proceeded with the TCO, benefiting importers of these electric accumulators by potentially allowing them to claim a refund of duty on goods imported since the effective date of the TCO.
The obligations imposed by this legislation primarily fall on the CEO, who must rigorously evaluate TCO applications against the core criteria. The CEO is also mandated to publish notices in the Gazette inviting objections to the TCO application, ensuring transparency and public participation in the decision-making process. Importers and other stakeholders must adhere to the terms of the TCO, which includes being aware of their rights to apply for duty refunds as stipulated under paragraph 126(1)(r) of the Regulations. Importantly, the TCO does not retroactively affect any existing rights or impose liabilities for actions taken before the TCO's effective date.
Non-compliance with the provisions of the Customs Act 1901 and the associated regulations could result in significant penalties. While the specific offences and penalties for breaches are not detailed in the explanatory statement, the Act generally provides for both civil and criminal penalties for non-compliance. Civil penalties might include fines, while criminal penalties could involve imprisonment, depending on the severity of the breach. The exact penalties would be determined in accordance with the relevant sections of the Act and any applicable regulations.