EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0913167
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.
Auto Electrical Imports applied for a TCO in respect of certain reversing alarms on 21 April 2009.
Instrument
TCO No 0913167 was made on 10 July 2009. It declares that those certain reversing alarms 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. 0913167 is taken to have come into force on 21 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 was enacted by the Australian Parliament to regulate the importation and exportation of goods, including the imposition of tariffs and duties. One specific instrument under this Act, Tariff Concession Instrument No. 0913167, was introduced on 10 July 2009 to address the issue of applying tariff concessions to certain goods, in this case reversing alarms, that were imported into Australia. The instrument was initiated by an application from Auto Electrical Imports on 21 April 2009, and it was designed to provide a tariff concession for these goods by setting their duty rate to zero, thus reducing the financial burden on importers and potentially stimulating market activity by making these goods more affordable. The instrument was subject to consultation as per the requirements of the Customs Act, though no objections were received, and it came into effect on the date of the application submission, 21 April 2009.
Scope and Application
The Tariff Concession Instrument No. 0913167, made under the Customs Act 1901, applies to the application of tariff concessions on certain goods, specifically reversing alarms in this instance. The Act pertains to applications for tariff concession orders, which are to be made by the Chief Executive Officer of Customs, and these orders provide a lower rate of customs duty on specified goods. The legislation applies to any person or entity that imports goods eligible for such concessions, ensuring that the application process adheres to the criteria outlined in sections 269C, 269D, and 269E of the Act, and that the goods do not fall under the exclusions specified in section 269SJ. The scope of the Act is national, as it is a Commonwealth instrument, thereby extending across all states and territories within Australia. The application process requires that no substitutable goods are produced in Australia in the ordinary course of business, as per section 269C. The application by Auto Electrical Imports for the tariff concession on reversing alarms was accepted as valid, resulting in the issuance of TCO No. 0913167, which took effect on the date the application was lodged, 21 April 2009. The instrument does not disadvantage any persons other than the Commonwealth and does not impose liabilities for actions taken before its registration. Importers of the affected goods can apply for a refund of duty from the effective date of the TCO.
Key Provisions
The Tariff Concession Instrument No. 0913167 (referred to as TCO No. 0913167) pertains to the Customs Act 1901 and operates under section 269F, which enables an application for a Tariff Concession Order (TCO) to be made to the Chief Executive Officer of Customs (CEO) for certain goods. The main operative section of this instrument is section 269C, which outlines the criteria for a TCO application to be considered valid. Specifically, a TCO application is deemed to meet the core criteria if, on the day the application was lodged, there were no substitutable goods produced in Australia in the ordinary course of business. If the CEO is satisfied that these criteria are met, a TCO is issued, as seen in the case of Auto Electrical Imports’ application for reversing alarms, which was granted under TCO No. 0913167 on 10 July 2009. This TCO stipulates that the reversing alarms are subject to a tariff rate of free duty, as opposed to the general rate of 5%.
The obligations imposed by the Customs Act 1901 on the parties involved include the requirement for the CEO to thoroughly assess each TCO application against the criteria set out in section 269C. This assessment must include ensuring that the goods in question are not substitutable by any Australian-produced goods at the time of the application. Additionally, as per subsection 269K(1), the CEO must publish a notice in the Gazette inviting any interested parties to submit objections to the TCO. In the case of TCO No. 0913167, no submissions were received in response to this notice. The instrument also mandates that the TCO is considered effective from the date the application was lodged, which in this instance was 21 April 2009. Furthermore, the TCO does not affect the rights of any person, except the Commonwealth, in a manner that would disadvantage them or impose liabilities for actions taken prior to the TCO’s registration.
In terms of consequences for non-compliance or breach, the Customs Act 1901 does not specify particular offences, penalties, or consequences within this context. However, it is implied that any misuse of the TCO, such as applying it to goods that do not meet the stipulated criteria, could potentially lead to legal challenges or administrative actions. Given that the TCO aims to facilitate trade by reducing duty on specific goods, adherence to the outlined criteria is crucial to maintaining the integrity of the concession scheme. The benefits of the TCO, such as the ability for importers to claim duty refunds, are contingent on compliance with the Act’s provisions. Thus, any breach of the Act could result in the revocation of the TCO and potential financial repercussions for the entities involved.