EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0910415
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.
Schlindler Lifts Australia applied for a TCO in respect of certain lift installations parts on 27 March 2009.
Instrument
TCO No 0910415 was made on 12 June 2009. It declares that those certain lift installations parts 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. 0910415 is taken to have come into force on 27 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 Australian Parliament to regulate the importation and exportation of goods into and out of Australia. The Act established a framework for managing customs duties and tariffs, ensuring the efficient and fair handling of goods. One notable instrument under this Act is Tariff Concession Order No. 0910415, introduced to address the specific needs of Schindler Lifts Australia, which applied for tariff concessions on certain lift installation parts. The objective of this legislation is to provide relief to businesses by reducing or eliminating customs duties on specified goods, thereby promoting economic efficiency and competitive advantage without disadvantaging existing rights or imposing new liabilities. This particular TCO was designed to ensure that Schindler Lifts Australia could import necessary parts at a reduced duty rate, aligning with the broader policy goal of supporting local industries by making essential goods more affordable.
Scope and Application
The Customs Act 1901, specifically Part XVA, outlines a framework for the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). This Act applies to any individual or entity seeking to import goods that may qualify for reduced customs duty rates through a TCO. The application process is governed by strict criteria, primarily ensuring that no substitutable goods are produced in Australia at the time of application. The geographic reach of this legislation is national, affecting all importers across Australia. The Act excludes certain goods as specified in section 269SJ, which lists those that cannot be subject to a TCO. The CEO has the authority to extend or restrict the application of TCOs through subordinate instruments, ensuring that the concessions are applied fairly and in line with the legislative intent. The Tariff Concession Instrument No. 0910415, made on 12 June 2009, exemplifies this process, where Schindler Lifts Australia successfully applied for tariff concessions on certain lift installation parts, leading to a zero-rate duty on these goods, effective from 27 March 2009.
Key Provisions
The main operative sections of this legislation, particularly sections 269C, 269P(3), and 269S(1) of the Customs Act 1901, establish the criteria for Tariff Concession Orders (TCOs) and outline the process for their issuance. Section 269C specifies that an application for a TCO meets the core criteria if, at the time of application, no substitutable goods are produced in Australia in the ordinary course of business. If the Chief Executive Officer (CEO) of Customs is satisfied that the application meets these criteria, they must issue a TCO under section 269P(3). The TCO, as per section 269S(1), is taken to have come into force on the day the application was lodged. In this case, TCO No. 0910415, made on 12 June 2009, applies to certain lift installation parts, reducing the duty rate from 5% to free.
The Customs Act 1901 imposes several obligations on the CEO when considering applications for a TCO. Once an application is accepted as valid, the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made, as per subsection 269K(1). In the case of TCO No. 0910415, no submissions were received. Additionally, the Act ensures that the TCO does not affect the rights of any person other than the Commonwealth, meaning it does not impose liabilities or disadvantage anyone regarding actions taken before the TCO's effective date. Importers of the specified goods can benefit from this TCO by applying for a refund of duty on goods imported since the TCO's effective date, as outlined in paragraph 126(1)(r) of the Regulations.
Breaching the provisions of the Customs Act 1901 or failing to comply with the requirements of a TCO can lead to various civil or criminal consequences. Although the specific offences and penalties are not detailed in the provided text, the Act generally includes provisions for fines and imprisonment for breaches related to customs duties and tariff concessions. The maximum penalties can vary depending on the nature and severity of the breach, but they could include substantial fines and imprisonment terms as stipulated under the relevant sections of the Act. The enforcement of these penalties is intended to ensure compliance with customs regulations and the proper application of tariff concessions.