EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0910169
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.
Bissel Australia Pty Ltd applied for a TCO in respect of certain carpert cleaners on 26 March 2009.
Instrument
TCO No 0910169 was made on 19 June 2009. It declares that those certain carpert cleaners 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. 0910169 is taken to have come into force on 26 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 Customs Act 1901 was enacted by the Parliament of Australia and governs the administration of customs and excise duties, including the imposition and collection of these duties. The Act establishes a framework for the application of tariff concessions through the use of Tariff Concession Orders (TCOs), allowing for reduced customs duty rates on specified goods under certain conditions. This legislative measure was introduced to address the need for flexibility in tariff structures to support industry competitiveness and economic growth by enabling the exemption of certain goods from standard customs duties. The explanatory statement for Tariff Concession Instrument No. 0910169, which was made under the Customs Act 1901, details the process and criteria for granting a TCO to Bissel Australia Pty Ltd for their carpet cleaners, ensuring no substitutable goods were produced in Australia. The policy objective is to provide tariff relief where appropriate, enhancing the efficiency and responsiveness of the customs regime to specific economic needs.
Scope and Application
The Tariff Concession Instrument No. 0910169, enacted under the Customs Act 1901, applies specifically to certain carpet cleaners that Bissel Australia Pty Ltd sought tariff concessions for. This instrument is applicable to the entity that applied for the concession and to the goods in question, which are now subject to the terms outlined in the instrument. The geographic reach of this Act is national, as it operates under the Commonwealth jurisdiction. The TCO does not affect the rights of any person other than the Commonwealth as at the date of registration, ensuring that no disadvantage or new liabilities are imposed on entities or individuals who engaged in transactions prior to the registration date. The Act extends its application through subordinate instruments, such as the Regulations mentioned, which provide further details on how the TCO affects import duties and potential refunds. The instrument explicitly excludes any goods specified in section 269SJ of the Act, which are ineligible for tariff concessions.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0910169, under the Customs Act 1901, include section 269C, which outlines the core criteria for a Tariff Concession Order (TCO) application. If a TCO application meets these core criteria, the Chief Executive Officer of Customs (CEO) must make a written order, as stated in section 269P(3). This written order, a TCO, then declares that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, as per section 269P(3). The definitions provided in sections 269D, 269E, and 269F further clarify the terms used in these sections, ensuring a clear understanding of what constitutes 'goods produced in Australia', 'ordinary course of business', and 'substitutable goods'.
The Act imposes several obligations and requirements on parties applying for a TCO. An applicant must ensure their application meets the core criteria, which include the absence of substitutable goods being produced in Australia on the day the application was lodged. This requirement is crucial for the CEO to consider the application valid. Furthermore, the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made, as mandated by section 269K(1). The CEO's decision to make a TCO is contingent upon satisfying these criteria and considering any submissions received. The Act also ensures that the rights of importers are protected and beneficially affected by the TCO, allowing them to apply for a refund of duty on goods imported since the TCO's effective date.
Under the Customs Act 1901, breaches of the requirements for a TCO or non-compliance with the obligations imposed by the Act may lead to various consequences. While the Act does not explicitly detail specific offences or penalties, breaches of customs-related regulations can result in fines, imprisonment, or both, depending on the severity of the offence. For instance, making a false statement in a customs document or attempting to evade duty can lead to penalties as outlined in the Crimes Act 1914. The maximum penalties for such offences can include substantial fines and imprisonment, with the exact penalties depending on the nature and extent of the breach. These provisions underscore the importance of compliance with the Act's requirements to avoid severe civil or criminal consequences.