EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0914120
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.
Kalidek Enterprises applied for a TCO in respect of certain electric food warmers on 28 April 2009.
Instrument
TCO No 0914120 was made on 17 July 2009. It declares that those certain electric food warmers 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. 0914120 is taken to have come into force on 28 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 Australian Parliament, provides a framework for the regulation of customs and excise within Australia. Specifically, Part XVA of the Act outlines a scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (CEO). The TCO scheme aims to facilitate tariff concessions for certain goods, thereby promoting trade and reducing customs duties on specified items. The 2009 Explanatory Statement, Tariff Concession Instrument No. 0914120, pertains to the application of Kalidek Enterprises for a TCO concerning certain electric food warmers, effective from 28 April 2009. The instrument was enacted to ensure that these specific goods would benefit from a lower rate of customs duty, aligning with the policy objective of providing tariff relief where no substitutable goods are produced in Australia. The CEO's decision to grant the concession was based on the absence of Australian-produced substitutable goods, thus meeting the core criteria as outlined in the Customs Act 1901.
Scope and Application
The Tariff Concession Instrument No. 0914120, made under the Customs Act 1901, applies to specific goods, namely certain electric food warmers, for which Kalidek Enterprises made an application to the Chief Executive Officer of Customs. This instrument grants a tariff concession order (TCO) that provides for a lower rate of customs duty on these goods, effectively reducing it to free. The Act applies to any person or entity seeking a tariff concession order for goods not produced in Australia and not specified in section 269SJ of the Act, which prohibits certain goods from being subject to a TCO. The instrument extends across the Commonwealth of Australia and is in effect from the date the application was lodged, which is 28 April 2009. The instrument does not disadvantage any person other than the Commonwealth and does not impose any new liabilities on individuals or entities. Any existing rights of importers will be positively affected, allowing them to apply for a refund of duty on goods imported since the effective date of the TCO. The CEO must also publish a notice in the Gazette inviting submissions on the TCO application, although in this case, no submissions were received.
Key Provisions
The Tariff Concession Instrument No. 0914120 under the Customs Act 1901 outlines specific provisions for the application and implementation of a Tariff Concession Order (TCO) for certain electric food warmers. According to section 269F, an application for a TCO can be submitted by a person to the Chief Executive Officer (CEO) of Customs. If the CEO determines that the application pertains to goods not excluded under section 269SJ, the core criteria specified in section 269C must be assessed. This means that a TCO can only be granted if no substitutable goods are being produced in Australia on the day the application is lodged. The definitions of "substitutable goods," "goods produced in Australia," and "ordinary course of business" are provided in sections 269D, 269E, and 269F, respectively. If the CEO finds that the application meets these criteria, a written TCO is issued under section 269P(3), specifying the applicable customs duty rate.
The obligations imposed on the parties by this legislation include the requirement for the CEO to publish a notice in the Gazette after accepting a TCO application, inviting any interested parties to submit objections (subsection 269K(1)). For the TCO No. 0914120, this notice was published, but no submissions were received. The TCO itself, as per subsection 269S(1), is deemed to have come into effect on the date the application was lodged, which was 28 April 2009 for this particular case. Importantly, the TCO does not affect the rights of any person other than the Commonwealth, ensuring that it does not impose any liabilities or disadvantages regarding actions taken before the TCO's effective date.
In terms of consequences for non-compliance or breach of the provisions under this TCO, the explanatory statement does not explicitly detail specific offences or penalties. However, the general framework of the Customs Act 1901 would apply, meaning any breach of the Act or regulations could result in criminal or civil penalties as prescribed under the Act. The potential penalties for breaches can range from fines to imprisonment, depending on the severity of the offence, although the specific maximum penalties are not outlined in this explanatory statement.