EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0839280
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.
Robert Bosch Limited applied for a TCO in respect of certain dc electric motor 1 kilowatt on 11 November 2008.
Instrument
TCO No 0839280 was made on 30 January 2009. It declares that those certain dc electric motor 1 kilowatt 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. 0839280 is taken to have come into force on 11 November 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 Parliament of Australia, serves as the foundational piece of legislation governing the regulation of customs and excise in Australia. It provides the framework for the administration of customs duties and the regulation of the import and export of goods. The Tariff Concession Instrument No. 0839280, introduced in 2009, is an amendment to the Customs Act 1901 designed to address the specific needs of industries seeking relief from certain customs duties. This instrument was enacted to provide tariff concessions for particular goods, in this case, dc electric motor 1 kilowatt, thereby reducing the customs duty rate from 5% to free. The policy objective of this instrument is to support Australian industries by lowering the cost of importing specific goods, thus making them more competitive in the market. The instrument was implemented without any adverse effect on the rights of persons other than the Commonwealth, ensuring that the concessions do not disadvantage existing stakeholders or impose new liabilities.
Scope and Application
The Customs Act 1901, through its Tariff Concession Orders (TCOs), provides a mechanism for the Chief Executive Officer of Customs to apply reduced customs duty rates on specific goods. This mechanism applies to any person or entity seeking a tariff concession for goods that are not already produced in Australia in the ordinary course of business and do not fall under the list of excluded goods specified in section 269SJ of the Act. The scope of the Act is national, as it operates under the Commonwealth jurisdiction and affects all entities and individuals involved in the importation of goods within Australia. The application process for a TCO involves submitting an application to the CEO, who then assesses whether the application meets the core criteria outlined in the Act, including the non-availability of substitutable goods produced domestically. Once the CEO is satisfied, a written TCO is issued, which reduces the customs duty rate on the specified goods from the general rate to a rate of free duty. This process ensures that importers of these goods can potentially benefit from reduced tariff rates and may apply for duty refunds on goods imported since the effective date of the TCO.
Key Provisions
The Tariff Concession Instrument No. 0839280 is a piece of legislation under the Customs Act 1901 (section 269F) that pertains to the application and granting of Tariff Concession Orders (TCOs). Specifically, section 269C of the Act sets out the core criteria that must be met for a TCO to be granted, which includes ensuring that no substitutable goods are produced in Australia on the day the application is lodged. Section 269B clarifies that the terms 'goods produced in Australia', 'ordinary course of business', and 'substitutable goods' have specific definitions provided by other sections of the Act. If the Chief Executive Officer of Customs (CEO) determines that these criteria are met, they must issue a TCO as per section 269P(3), effectively reducing the duty on the specified goods.
Under this legislation, the obligations imposed on parties such as Robert Bosch Limited, who applied for the TCO, include providing detailed and accurate information in their application to ensure it meets the core criteria outlined in the Act. The CEO's obligations involve reviewing the application to determine if it meets the criteria, publishing a notice in the Gazette to invite submissions from interested parties (subsection 269K(1)), and making a decision based on the application and any received submissions. In this case, since no submissions were received, the CEO proceeded to grant the TCO.
The Act also includes provisions for the consequences of non-compliance or improper applications. While specific offences and penalties are not detailed within the explanatory statement, the Act generally provides for enforcement actions, including potential civil or criminal penalties, should an application be found to be in breach of the conditions set out in the Customs Act 1901. The severity of these penalties would depend on the nature and extent of the breach, and could potentially include fines or other sanctions as prescribed by relevant laws. The Act ensures that the TCO does not affect the rights of any person as at the date of registration, nor does it impose any new liabilities on any person, thus protecting existing rights and interests.