EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0911062
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 ceiling light fixture on 01 April 2009.
Instrument
TCO No 0911062 was made on 19 June 2009. It declares that those certain ceiling light fixture 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. 0911062 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. 0911062, made under the Customs Act 1901, was enacted to address the need for a streamlined process to reduce the customs duty on certain goods, thereby facilitating trade and potentially lowering costs for businesses and consumers. This instrument was introduced in response to an application from Mercator Lighting, which sought tariff concessions on specific ceiling light fixtures. The instrument was made by the Chief Executive Officer of Customs (CEO), who is authorised to make such orders if certain core criteria are met, including the absence of substitutable goods produced in Australia. The CEO's decision to grant the concession was based on the fact that no submissions opposing the tariff concession were received, indicating a lack of objections to the application. This instrument aims to ensure that the rights of importers are beneficially affected and that no new liabilities are imposed on any party.
Scope and Application
The Tariff Concession Instrument No. 0911062, which is an application of the Customs Act 1901, applies to any person or entity seeking tariff concessions on specific goods that are imported into Australia. This instrument particularly pertains to the application made by Mercator Lighting for a tariff concession order (TCO) on certain ceiling light fixtures. The scope of the Act extends to ensuring that the application for TCO meets the core criteria specified under sections 269C and 269SJ of the Act, which includes verifying that no substitutable goods are produced in Australia in the ordinary course of business. The jurisdictional reach of this legislation is national, as it falls under the Commonwealth purview. There are no exclusions or exemptions specified for this particular TCO, and the instrument does not affect any pre-existing rights or impose any new liabilities on persons other than the Commonwealth. Additionally, the application of this Act may be extended or restricted through subordinate instruments, as allowed under the Customs Act 1901.
Key Provisions
The key operative sections of the Tariff Concession Instrument No. 0911062 (the Instrument) are primarily found in sections 269C, 269P, and 269S of the Customs Act 1901 (the Act). Section 269C outlines the core criteria that must be met for a Tariff Concession Order (TCO) application to be considered valid, which includes ensuring that no substitutable goods are produced in Australia. Section 269P(3) stipulates that if these core criteria are satisfied, the Chief Executive Officer of Customs (the CEO) must issue a written order, effectively granting the TCO. Section 269S details the commencement of the TCO, which is effective from the date the application is lodged.
Under the Instrument, the CEO is obligated to assess whether the application for a TCO meets the core criteria set out in section 269C of the Act. This involves determining if no substitutable goods are produced in Australia on the day the application is lodged. If the CEO is satisfied that the application meets these criteria, they must proceed to issue a TCO, as outlined in section 269P(3). Additionally, under section 269K(1), the CEO must publish a notice in the Gazette inviting any interested parties to submit any objections to the TCO within a specified timeframe. In this instance, no submissions were received, facilitating the progression of the TCO.
Breaching the obligations set out in the Act can have legal consequences. For instance, if the CEO fails to properly assess an application against the core criteria or incorrectly issues a TCO without meeting the statutory requirements, this could be considered an administrative error. Such errors might lead to the TCO being subject to judicial review, and the CEO could potentially face penalties under section 283 of the Act for improper exercise of their powers. In terms of penalties for individuals or entities, while the Act does not explicitly outline penalties for breaches related to TCOs, general penalties for non-compliance with customs regulations can include fines up to $22,200 or imprisonment for up to two years, or both, as provided under section 284 of the Act.
The Instrument also outlines that the TCO will not affect the rights of any person, except the Commonwealth, in respect of actions taken before the TCO's effective date, as stipulated in section 269S(3). This means that any liabilities or rights accrued before the TCO's commencement remain unaffected. Moreover, importers of the specified goods can apply for a refund of duty paid on goods imported since the TCO's effective date, as per paragraph 126(1)(r) of the Regulations. The TCO itself does not impose any new liabilities on any person, thereby protecting individuals and entities from any new financial burdens resulting from the concession.