EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0910538
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.
Group Technologies Australasia applied for a TCO in respect of certain loudspeakers on 27 March 2009.
Instrument
TCO No 0910538 was made on 19 June 2009. It declares that those certain loudspeakers 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. 0910538 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 Tariff Concession Instrument No. 0910538, enacted under the Customs Act 1901, was introduced to address the need for tariff concessions on specific goods, in this case certain loudspeakers, that are not produced in Australia. The instrument was made on 19 June 2009 and came into effect on 27 March 2009, the day the application was lodged by Group Technologies Australasia. The instrument was developed to ensure that no substitutable goods were being produced in Australia, which is a core criterion for the tariff concession. As no submissions were received in opposition to the tariff concession, the Chief Executive Officer of Customs was satisfied to proceed with the concession, resulting in the duty on these specific loudspeakers being reduced from the general rate of 5% to free. This was done to benefit the rights of importers, who can apply for a refund of duty on these goods since the day the tariff concession came into force.
Scope and Application
The Customs Act 1901, under Part XVA, provides a framework for the Chief Executive Officer of Customs to issue Tariff Concession Orders (TCOs), which apply a lower rate of customs duty to specified goods. This legislative provision is designed to facilitate the importation of goods that are not produced domestically or are substitutable by imported goods. The Act applies to individuals and entities that import goods into Australia, with the scope limited to those goods not specified in section 269SJ of the Act, which excludes certain goods from tariff concession eligibility. The application of a TCO hinges on the core criteria set out in sections 269C and 269P of the Act, which require the CEO to confirm that no substitutable goods are produced in Australia in the ordinary course of business. The instrument, TCO No. 0910538, exemplifies this process by applying a zero rate of duty on specific loudspeakers, which was deemed effective from the date of application submission, 27 March 2009. The geographical reach of this Act is national, applying uniformly across all states and territories within Australia, with the CEO's decision being final and binding on all parties involved in the importation of the goods subject to the TCO. The Act does not impose liabilities on persons other than the Commonwealth, nor does it disadvantage existing rights of importers, thereby ensuring that importers can benefit from duty refunds for goods imported since the effective date of the TCO.
Key Provisions
The main sections of the Tariff Concession Instrument No. 0910538 involve the application and determination of a Tariff Concession Order (TCO) under the Customs Act 1901 (section 269F). If a person applies for a TCO for certain goods, the Chief Executive Officer (CEO) of Customs assesses whether the application meets the core criteria (section 269C). If satisfied, the CEO must issue a TCO, which declares that the goods in question are subject to a lower customs duty as specified in the Customs Tariff Act 1995 (section 269P(3)). For the TCO in question, the CEO was satisfied that no substitutable goods were produced in Australia in the ordinary course of business (section 269E), and thus, the CEO issued a TCO for certain loudspeakers, making them subject to a zero rate of duty instead of the general rate of 5%.
The Act imposes several obligations on the parties involved. The CEO of Customs must assess each TCO application to determine if it meets the core criteria (section 269C). This involves ensuring that no substitutable goods were produced in Australia on the day the application was lodged. Additionally, as soon as practicable after accepting a TCO application, the CEO must publish a notice in the Gazette inviting any person who believes the TCO should not be made to submit their reasons (subsection 269K(1)). This ensures transparency and allows for public input before the TCO is issued.
Failure to comply with the requirements of the Customs Act 1901 can result in both civil and criminal consequences. Specifically, breaches of the Act, including improper applications for TCOs or the misuse of TCOs, can lead to penalties. The maximum penalties for offences under the Customs Act include fines and imprisonment, depending on the severity of the breach. The exact penalties are detailed in the relevant sections of the Act and may vary based on the specific circumstances of the offence.
For TCO No. 0910538, there are no obligations or liabilities imposed on any person other than the Commonwealth, and it does not affect the rights of any person as at the date of registration. Importers of the specified goods will benefit from this TCO by being able to apply for a refund of duty on goods imported since the TCO came into force on 27 March 2009. This ensures that the benefits of the TCO are passed on to the importers without creating any new liabilities for them.