EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0912636
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.
Jord International Pty Ltd applied for a TCO in respect of certain fans axial on 16 April 2009.
Instrument
TCO No 0912636 was made on 10 July 2009. It declares that those certain fans axial 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. 0912636 is taken to have come into force on 16 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 Customs Act 1901, enacted by the Parliament of Australia, provides a framework for the imposition of customs duties on imported goods. It includes provisions for the creation of Tariff Concession Orders (TCOs) to grant concessions on certain goods, thereby reducing the customs duty payable on them. The primary issue the Act was designed to address is the need for a flexible mechanism to adjust customs duties to support specific economic policies or to provide relief to certain sectors or products. Tariff Concession Instrument No. 0912636, made under the authority of the Customs Act 1901, is one such measure aimed at facilitating the import of particular goods by reducing or eliminating customs duty. This instrument, which came into effect on 16 April 2009, was introduced following an application by Jord International Pty Ltd for a concession on certain fans axial, resulting in a reduction of the duty rate from 5% to free. The policy objective is to ensure that the application of customs duty does not unduly burden specific industries or products, thereby supporting economic activity and trade efficiency.
Scope and Application
The Customs Act 1901 governs the administration of customs and excise duties in Australia, with Part XVA establishing a framework for Tariff Concession Orders (TCOs) that can be issued by the Chief Executive Officer of Customs (CEO) to provide a lower rate of customs duty on specified goods. An application for a TCO can be made by any person in relation to goods that are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. The CEO must determine if the application meets the core criteria, including ensuring that no substitutable goods are produced in Australia on the date the application is lodged. If the CEO is satisfied that the application meets the criteria, a TCO is issued, effective from the date the application was lodged. The process also involves publishing a notice in the Gazette to invite submissions from interested parties, although in the case of TCO No. 0912636, no submissions were received. The TCO does not affect the rights of any person as at the date of registration and does not impose any liabilities on any person. Instead, it allows for the potential refund of duty on goods imported since the TCO's effective date, thereby benefiting importers of the specified goods.
Key Provisions
The primary sections of the Tariff Concession Order No. 0912636, made under the Customs Act 1901, involve the application and implementation of tariff concessions for certain goods. Specifically, section 269C of the Act outlines the core criteria that must be met for an application to be considered valid. If the Chief Executive Officer of Customs (CEO) determines that these criteria are met, they must make a written order (section 269P(3)) that designates the goods in question as eligible for a tariff concession. In this instance, the TCO No. 0912636 specifies that certain fans axial are subject to a concession, granting them a duty-free status instead of the general rate of 5% (item 50 of Schedule 4 to the Customs Tariff Act 1995).
The obligations imposed by this Act on the relevant parties include the requirement for applicants to submit their applications to the CEO and for the CEO to assess these applications against the core criteria. If the CEO decides that the application meets the criteria, they must make a TCO and publish a notice in the Gazette (subsection 269K(1)), inviting any interested parties to submit submissions opposing the concession. In this case, no submissions were received, allowing the TCO to proceed without objection.
The Act also mandates that the TCO comes into force on the date the application is lodged (subsection 269S(1)), which for TCO No. 0912636 is 16 April 2009. This means that any goods imported on or after this date are eligible for the tariff concession. Furthermore, the TCO ensures that the rights of importers are beneficially affected, allowing them to apply for a refund of duty on goods imported since the concession came into force (paragraph 126(1)(r) of the Regulations). Importantly, the TCO does not retroactively affect the rights of any person or impose any liabilities for actions taken before the TCO was registered.
In terms of penalties and consequences, the Customs Act 1901 does not explicitly state penalties for breaches related to Tariff Concession Orders within this specific context. However, the general framework of the Act implies that non-compliance with customs regulations could result in penalties. These might include fines, imprisonment, or other civil or criminal consequences depending on the nature and severity of the breach. The specific penalties for non-compliance would be determined by other relevant provisions of the Customs Act 1901 or related legislation.