EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0909606
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.
Anaconda Stores Pty Ltd applied for a TCO in respect of certain lanterns on 23 March 2009.
Instrument
TCO No 0909606 was made on 12 June 2009. It declares that those certain lanterns 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. 0909606 is taken to have come into force on 23 March 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. 0909606 was enacted in 2009 under the Customs Act 1901. It was introduced to address the need for tariff concessions on certain goods that are imported into Australia, specifically to provide a lower rate of customs duty for those goods. This instrument was enacted by the Chief Executive Officer of Customs in response to an application from Anaconda Stores Pty Ltd for tariff concessions on certain lanterns. The underlying policy objective is to facilitate the importation of goods that are not produced domestically in a manner that corresponds to their use, thereby benefiting importers and potentially reducing costs for consumers. The Customs Act 1901 provides the framework for the tariff concession scheme, allowing the CEO to make such orders if certain criteria are met, ensuring that the concessions do not disadvantage existing domestic producers or impose new liabilities on any person.
Scope and Application
The Customs Act 1901 provides a mechanism for the reduction of customs duty on certain goods through Tariff Concession Orders (TCOs), which are issued by the Chief Executive Officer of Customs (CEO) under section 269F of the Act. The scope of the Act applies to any person or entity that wishes to apply for a TCO for goods not specified in section 269SJ of the Act, which excludes certain goods from TCO eligibility. A TCO application is assessed against the core criteria in section 269C of the Act, which requires that no substitutable goods are produced in Australia in the ordinary course of business on the day the application was lodged. If the CEO is satisfied that the application meets these criteria, a written order is made, as in the case of TCO No. 0909606 for certain lanterns, reducing the duty rate from 5% to free. The TCO has a national jurisdictional reach within Australia and does not disadvantage any person or impose liabilities on anyone for actions taken before the order's registration date. The TCO's commencement date aligns with the date of the application, ensuring that the benefits of the concession apply retroactively from that date. The CEO is also required to publish notices in the Gazette to allow for public submissions on TCO applications, although no submissions were received for TCO No. 0909606.
Key Provisions
The key operative sections of Tariff Concession Instrument No. 0909606 include section 269F of the Customs Act 1901, which outlines the process for applying for a Tariff Concession Order (TCO). An applicant may submit an application to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods, provided that the goods are not specified in section 269SJ of the Act (paragraphs 1 and 2). The CEO must then assess whether the application meets the core criteria, as stipulated in section 269C. If the CEO is satisfied that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged, they must make a written order, which is the TCO (paragraph 3).
The Act imposes several obligations and requirements on the parties involved. The CEO must publish a notice in the Gazette inviting any person who considers there are reasons why the TCO should not be made to lodge a submission with the CEO, as per subsection 269K(1) of the Act (paragraph 4). Anaconda Stores Pty Ltd, as the applicant, is required to ensure their application meets the core criteria and that the goods they are applying for are not specified in section 269SJ. Importers of the goods subject to the TCO have the right to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force, as per paragraph 126(1)(r) of the Regulations (paragraph 5).
The Act does not specify any offences, penalties, or consequences for breach of the TCO. However, it is important to note that 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 (paragraph 6). This means that any actions taken by the CEO or other parties prior to the date of registration are not affected by the TCO, and no liabilities are imposed on any person as a result of the TCO.