EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0911060
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.
Mercator Lighting applied for a TCO in respect of certain wall and ceiling spotlights on 01 April 2009.
Instrument
TCO No 0911060 was made on 19 June 2009. It declares that those certain wall and ceiling spotlights 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. 0911060 is taken to have come into force on 01 April 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. 0911060, enacted in 2009, is a legislative measure under the Customs Act 1901. This Act facilitates the application of tariff concessions for specific goods, allowing for a lower rate of customs duty. The instrument was introduced to address the need for streamlined customs duty processes for businesses importing specific goods, ensuring they are not unduly burdened by high customs tariffs. The instrument was enacted by the Australian Parliament, aiming to provide economic benefits by reducing the cost of importing certain goods. This legislative measure ensures that importers are not disadvantaged and can potentially apply for refunds on duties paid before the concession came into effect, thereby encouraging fair trade practices and economic efficiency.
Scope and Application
The Tariff Concession Instrument No. 0911060 under the Customs Act 1901 applies to any person or entity seeking a tariff concession order for specific goods, in this case, certain wall and ceiling spotlights, which are declared to be subject to a free rate of duty as opposed to the general rate of 5%. The Act facilitates the process for the Chief Executive Officer of Customs (CEO) to make such orders if the application meets the core criteria, including the absence of substitutable goods produced in Australia. The CEO, upon satisfaction that the application complies with the statutory requirements and no objections are raised, issues a written order effective from the date the application was lodged. The geographic reach of this legislation is national, as it pertains to the application and processing of tariff concessions across Australia. There are no exclusions or exemptions specified in the context of this particular instrument, though the Act itself may contain provisions excluding certain goods from tariff concessions. The application and scope of the Act may be further defined or extended through subordinate instruments, such as regulations or further orders made under the Customs Act 1901.
Key Provisions
The primary sections of the Tariff Concession Instrument No. 0911060, under the Customs Act 1901, establish the conditions and process for granting tariff concession orders (TCO) for specific goods, in this case, certain wall and ceiling spotlights (sections 269C, 269P). Section 269C sets out the core criteria for a TCO application, which includes the condition that no substitutable goods are produced in Australia. If the Chief Executive Officer of Customs (CEO) is satisfied that these criteria are met, they must issue a written order under section 269P(3), specifying the applicable customs duty rate for the goods, which in this case is free, as opposed to the general rate of 5% (Schedule 4, item 50 of the Customs Tariff Act 1995).
The obligations imposed by the Act on the parties involved primarily rest with the CEO, who must evaluate TCO applications to ensure they meet the core criteria as outlined in section 269C. This involves determining whether substitutable goods are produced in Australia at the time the application is lodged. Additionally, under section 269K(1), the CEO must publish a notice in the Gazette inviting submissions from interested parties, although no submissions were received in this instance. The CEO is also responsible for ensuring that the TCO does not disadvantage any person other than the Commonwealth and does not impose liabilities for actions taken before the TCO's registration date, as stipulated in subsection 269S(1).
Breaching the provisions of the Customs Act 1901, particularly in relation to the issuance and conditions of a TCO, can result in various legal consequences. While the specific penalties for breaches are not detailed in the explanatory statement, it is known that the Act provides for both civil and criminal penalties for non-compliance. For instance, section 243AA of the Customs Act 1901 may impose fines and imprisonment for offences related to the importation of goods under false or misleading declarations. Similarly, section 243AB imposes penalties for evading customs duty. These provisions underscore the importance of adhering to the Act's requirements to avoid legal repercussions.