EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0904720
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.
Moffat applied for a TCO in respect of certain ovens on 12 February 2009.
Instrument
TCO No 0904720 was made on 08 May 2009. It declares that those certain ovens 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. 0904720 is taken to have come into force on 12 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 Tariff Concession Instrument No. 0904720 was enacted in 2009 under the Customs Act 1901 to address the need for tariff concessions on certain imported goods. The Customs Act 1901 allows for the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs), which provide for a lower rate of customs duty on specified goods. The 2009 Instrument was created following an application from Moffat for a TCO on certain ovens, and it was issued because the CEO was satisfied that no substitutable goods were produced in Australia at the time the application was lodged. This Instrument was intended to benefit importers by allowing them to apply for a refund of duty on these goods imported since the effective date of the TCO. The Instrument was introduced without any submissions opposing it, and it took effect on the date the application was lodged, 12 February 2009. The Instrument ensures that it does not disadvantage any person or impose liabilities on anyone in respect of actions taken before its registration.
Scope and Application
The Customs Act 1901, as supplemented by the Tariff Concession Instrument No. 0904720, applies to individuals or entities seeking tariff concessions on imported goods through the submission of an application to the Chief Executive Officer of Customs. This Act facilitates the granting of Tariff Concession Orders (TCOs) to lower the customs duty rates on specific goods, provided that the application meets the core criteria, notably the absence of substitutable goods produced in Australia. The geographic reach of the Act is national, as it pertains to the Commonwealth's customs regulations. However, it excludes certain goods specified in section 269SJ of the Act, which cannot be subject to a TCO. The application of the Act may also extend through subordinate instruments, though these are not specified in the provided text. The commencement of the TCO is deemed to be from the date the application was lodged, and it does not retroactively affect the rights of any person, ensuring that no pre-existing liabilities or disadvantages are imposed on importers or other entities.
Key Provisions
The main operative sections of this legislation are sections 269C, 269P, and 269S, among others, which detail the process for making a Tariff Concession Order (TCO) under the Customs Act 1901. Section 269C specifies the core criteria that must be met for a TCO application to be valid, which includes ensuring that no substitutable goods are produced in Australia. Section 269P outlines the action the Chief Executive Officer of Customs (CEO) must take if the core criteria are met, which involves making a written order declaring that the goods in question are subject to the tariff concession. Section 269S deals with the commencement of the TCO, specifying that it comes into force on the day the application is lodged.
The obligations and requirements imposed by the Act on the parties involved are significant. The CEO of Customs must assess each TCO application to determine if it meets the core criteria specified in section 269C. If satisfied, the CEO must publish a notice in the Gazette inviting any interested parties to lodge submissions regarding the application. Additionally, once a TCO is issued, the CEO must ensure that the rights of the importers are beneficially affected, and importers can apply for a refund of any duty paid on the goods since the effective date of the TCO.
Breaches of the provisions outlined in the Customs Act 1901 can lead to various penalties and consequences. For instance, making false statements in an application for a TCO can result in criminal penalties, including fines and imprisonment. The maximum penalties can vary depending on the severity of the offence, but they are significant enough to deter non-compliance. Furthermore, failure to adhere to the conditions of the TCO can lead to civil consequences, such as the imposition of additional duties or the revocation of the concession.
In summary, the legislation establishes a clear process for applying for and granting TCOs, ensuring that the rights of importers are protected and that the concessions are granted only when appropriate. It also imposes strict obligations on the CEO and potential penalties for non-compliance, thereby maintaining the integrity of the tariff concession scheme.