EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0834652
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.
Ausmart International Pty Ltd applied for a TCO in respect of certain shopping trolley locks on 08 October 2008.
Instrument
TCO No 0834652 was made on 14 January 2009. It declares that those certain shopping trolley locks 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. 0834652 is taken to have come into force on 08 October 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 customs duties and tariff concessions. This Act allows the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that lower the customs duty on certain goods. The Tariff Concession Instrument No. 0834652, issued in 2009, addresses the problem of high customs duties on specific goods by providing a concession, thereby supporting Australian businesses and consumers by reducing the cost of importing certain items. The instrument was introduced following an application by Ausmart International Pty Ltd for a TCO on shopping trolley locks, which was approved by the CEO after it was determined that no substitutable goods were produced in Australia. The policy objective of this instrument is to facilitate the importation of these goods by applying a zero-rate duty, enhancing the competitiveness of Australian businesses in the market.
Scope and Application
The Tariff Concession Instrument No. 0834652 under the Customs Act 1901 applies specifically to the application submitted by Ausmart International Pty Ltd concerning certain shopping trolley locks. This instrument was made by the Chief Executive Officer of Customs (CEO) and is applicable to the goods specified in the TCO, which are now subject to a free rate of duty as opposed to the general rate of 5%. The Act applies to any individual or entity involved in the importation of these specific goods, thereby directly affecting importers. The geographic scope of this legislation is national, as it pertains to customs duties under the Commonwealth of Australia. Notably, this instrument does not affect the rights of any person other than the Commonwealth and does not impose any liabilities on individuals or entities for actions taken prior to the instrument's registration. Additionally, the CEO is required to publish a notice in the Gazette inviting submissions from any interested parties, though in this case, no submissions were received. The TCO is deemed to have come into force on the date the application was lodged, which was 8 October 2008.
Key Provisions
The main operative sections of the Customs Act 1901, as relevant to Tariff Concession Orders (TCOs), include sections 269C, 269F, 269P, and 269S. Section 269F enables a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO, which allows for a lower rate of customs duty on the goods specified in the application. If the CEO determines that the application meets the core criteria, including that no substitutable goods are produced in Australia in the ordinary course of business (section 269C), a written order is made (section 269P). This order then declares that the goods in question are subject to a specific item of the Customs Tariff Act 1995, thus granting the tariff concession.
The Act imposes several obligations on the parties involved in the TCO process. The CEO must, upon receiving a valid TCO application, determine if the application meets the core criteria by ensuring no substitutable goods are produced in Australia in the ordinary course of business. If the criteria are met, the CEO is required to make a TCO and publish a notice in the Gazette, inviting any interested parties to submit objections if they believe the TCO should not proceed (subsection 269K(1)). In the case of Ausmart International Pty Ltd's application for a TCO concerning certain shopping trolley locks, the CEO did not receive any objections after the publication of the notice.
Failing to comply with the requirements of the Customs Act 1901 can result in both civil and criminal consequences. The Act does not specify particular offences related to the TCO process, but general non-compliance with customs duties and regulations can lead to civil penalties such as fines or the seizure of goods. Criminal penalties might also apply, depending on the nature and severity of the breach, which could include imprisonment. The exact penalties are determined by other relevant legislation, such as the Crimes Act 1914, and can vary based on the circumstances of the case. The TCO itself does not impose any new liabilities on individuals or entities, but it does affect the rights of importers by potentially allowing them to apply for a refund of duty on goods imported since the TCO came into force.