EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0840065
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.
Elton Group Pty Ltd applied for a TCO in respect of certain acoustic panels on 17 November 2008.
Instrument
TCO No 0840065 was made on 30 January 2009. It declares that those certain acoustic panels 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. 0840065 is taken to have come into force on 17 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 was enacted to regulate the importation and exportation of goods in Australia. The Act was introduced to address the need for a structured approach to managing customs duties and ensuring compliance with international trade agreements. Part XVA of the Customs Act establishes a scheme under which Tariff Concession Orders (TCOs) can be made, providing lower rates of customs duty on specified goods. The Tariff Concession Instrument No. 0840065, made on 30 January 2009, provides an example of how this scheme operates. This specific TCO was introduced following an application by Elton Group Pty Ltd for certain acoustic panels, where the Chief Executive Officer of Customs determined that the goods qualified for a tariff concession as no substitutable goods were produced in Australia at the time of application. The instrument came into effect on 17 November 2008, the date the application was lodged, and it aims to benefit importers by allowing them to apply for a refund of duty on goods imported since the TCO's effective date.
Scope and Application
The Tariff Concession Order No. 0840065 under the Customs Act 1901 applies to specific acoustic panels as determined by the Chief Executive Officer of Customs (CEO) following an application by Elton Group Pty Ltd. This instrument, effective from 17 November 2008, aims to provide a tariff concession by setting the duty on these goods to free, as opposed to the general rate of 5%, provided that no substitutable goods were produced in Australia at the time of the application. This concession is granted under Part XVA of the Customs Act 1901, which facilitates tariff reductions through Tariff Concession Orders (TCOs) for goods not specified in section 269SJ of the Act, such as those that cannot be subject to a TCO. The CEO must ensure that the application meets core criteria, primarily that no substitutable goods were produced in Australia in the ordinary course of business. The geographic reach of this Act is national, with the CEO having the authority to make such orders on a federal level. The rights of importers are positively affected, as they can apply for refunds of duties on goods imported since the TCO's effective date, without any imposition of liabilities on any person.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0840065 under the Customs Act 1901 (section 269P(3)) involve the declaration by the Chief Executive Officer of Customs (CEO) that certain acoustic panels are subject to a Tariff Concession Order (TCO). This declaration is made when the CEO determines that no substitutable goods were produced in Australia at the time the application was lodged (section 269C). The TCO specifies that these particular acoustic panels are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, with the rate of duty being reduced from 5% to free.
Under this Act, any person may apply to the CEO for a TCO in respect of goods (section 269F). The CEO must ensure that the application is not for goods specified in section 269SJ, which are ineligible for a TCO. If the CEO is satisfied that the application meets the core criteria, they must make a written order declaring that the goods in question are subject to a TCO (section 269P(3)). Additionally, the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made (subsection 269K(1)). If no submissions are received, the CEO proceeds to make the TCO.
The obligations imposed on parties by this Act include the requirement for the CEO to evaluate TCO applications based on whether substitutable goods were produced in Australia at the time of application. This involves verifying that the goods in question are not specified in section 269SJ and that the application meets the core criteria outlined in section 269C. Furthermore, the CEO must publish a notice in the Gazette and consider any submissions received in response to that notice.
Breaching the conditions of a TCO or failing to comply with the statutory requirements for making a TCO could potentially lead to civil or criminal consequences. While the explanatory statement does not explicitly outline offences or penalties, breaches of the Customs Act 1901 generally can result in penalties such as fines and, in severe cases, imprisonment. The specific penalties would depend on the nature and severity of the breach, as determined by the relevant courts and in accordance with the applicable laws.