EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0903616
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.
Govan Industries applied for a TCO in respect of certain junction boxes casings on 04 February 2009.
Instrument
TCO No 0903616 was made on 01 May 2009. It declares that those certain junction boxes casings 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. 0903616 is taken to have come into force on 04 February 2009.
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, establishes a framework for the administration of customs and excise duties, as well as other regulations related to the import and export of goods. The Act was introduced to address the need for a structured approach to managing customs duties and ensuring compliance with import regulations. Part XVA of the Act, which allows for the creation of Tariff Concession Orders (TCOs), was introduced to provide relief from customs duties for specific goods where appropriate, facilitating trade and economic efficiency. The Tariff Concession Instrument No. 0903616, made on 1 May 2009, is a specific instance of this framework in action. It was issued in response to an application from Govan Industries for tariff concessions on certain junction boxes casings, and the instrument declares that these goods are subject to a free rate of duty, effective from the date the application was lodged, 4 February 2009. This mechanism ensures that the application process is transparent and allows for public input before a decision is made, ultimately aiming to support Australian industries by reducing the cost of importing certain goods.
Scope and Application
The Customs Act 1901, as supplemented by Tariff Concession Order (TCO) No. 0903616, provides a framework for the application of tariff concessions on specific goods. This legislation applies to entities or individuals who are seeking a reduction in customs duty on goods imported into Australia. The Act specifically targets the application process for tariff concessions, requiring the Chief Executive Officer of Customs to assess whether an application meets the core criteria, including whether substitutable goods are produced in Australia. This instrument is applicable across the Commonwealth of Australia and extends to all goods that meet the specified conditions for tariff concessions, subject to the exclusions outlined in section 269SJ of the Act. The TCO No. 0903616, effective from 04 February 2009, reduces the duty on certain junction boxes casings to free, provided the CEO is satisfied that no substitutable goods are produced domestically. The legislation ensures that the rights of importers are protected and may benefit from duty refunds for goods imported since the TCO's effective date, without imposing any new liabilities on persons other than the Commonwealth.
Key Provisions
The primary operative sections of this legislation, particularly section 269F of the Customs Act 1901, allow for the application for Tariff Concession Orders (TCOs) by any person seeking lower rates of customs duty for specific goods. Section 269C stipulates that for a TCO to be considered, the application must meet the core criteria, primarily that no substitutable goods are produced in Australia in the ordinary course of business. Section 269P(3) mandates that if these criteria are met, the Chief Executive Officer of Customs (CEO) must issue a written order, which constitutes the TCO, applying a prescribed tariff concession.
In the context of obligations and requirements, the CEO must first assess whether the goods in question are eligible for a TCO by ensuring they are not specified in section 269SJ, which lists goods ineligible for TCOs. Once an application is deemed valid, the CEO must publish a notice in the Gazette (subsection 269K(1)), inviting submissions from any person who believes the TCO should not proceed. If no objections are received, the CEO proceeds to issue the TCO. The obligations also include ensuring that the TCO does not retroactively affect the rights of any person other than the Commonwealth, as stipulated in subsection 269S(1). This means that any rights or liabilities incurred prior to the TCO's effective date remain unaffected.
The legislation outlines several consequences for non-compliance or breach of the provisions. However, this particular piece of legislation does not specify explicit criminal or civil penalties for breaches. The primary focus is on the administrative process and ensuring that the TCOs are issued according to the criteria set out in the Act. The consequences of failing to comply with the conditions for issuing a TCO would likely involve administrative or legal scrutiny to ensure adherence to the legislative framework.
It is important to note that the rights of importers are protected under this legislation. Specifically, under paragraph 126(1)(r) of the Regulations, importers can apply for a refund of duty on goods imported since the day the TCO is deemed to come into force. This provision ensures that importers are not disadvantaged and can benefit from the lower duty rates once the TCO is in effect.
In summary, this legislation provides a structured process for the application and issuance of Tariff Concession Orders by the CEO of Customs, ensuring that the criteria are strictly adhered to, and the rights of importers are safeguarded. The primary focus is on the procedural and administrative aspects rather than penal consequences, ensuring that the tariff concessions are applied fairly and within the legislative framework.