EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0919363
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.
Alternative Glass Supplies applied for a TCO in respect of certain air conditioned cabinets on 09 June 2009.
Instrument
TCO No 0919363 was made on 28 August 2009. It declares that those certain air conditioned cabinets 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. 0919363 is taken to have come into force on 09 June 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. 0919363 was enacted under the Customs Act 1901 to provide tariff concessions for certain air conditioned cabinets, specifically reducing their customs duty rate from 5% to free. This legislative instrument was introduced to address the issue of ensuring that Australian businesses and consumers can access essential goods at a reduced cost, thereby promoting economic efficiency and consumer benefit. The instrument was enacted by the Chief Executive Officer of Customs, who is empowered under section 269F of the Customs Act to make such orders when satisfied that the application meets the core criteria, including the absence of substitutable goods produced in Australia. The policy objective of this instrument is to facilitate the importation of specific goods that are not locally produced, ensuring that they are available at a lower cost to consumers and businesses, thereby supporting economic activity and market competition.
Scope and Application
The Tariff Concession Instrument No. 0919363, under Part XVA of the Customs Act 1901, applies to any person or entity seeking to import specific goods into Australia, particularly certain air-conditioned cabinets as specified in the Instrument. This Act facilitates the reduction or waiver of customs duties on these goods, provided certain criteria are met, such as the absence of substitutable goods being produced in Australia. The application of this Act is limited to the goods specified in the Instrument and does not affect the rights or liabilities of any person except the Commonwealth in relation to actions taken prior to the Instrument's effective date. The Instrument came into force on 09 June 2009, the same day the application was lodged, and allows for the potential refund of duty on imported goods as per the Customs Regulations. The scope of the Act is further defined and managed through the subordinate instrument which specifies the particular goods and the applicable tariff concessions, thereby extending or restricting the application of the Act to the goods specified in the Instrument.
Key Provisions
The main operative sections of the Customs Act 1901 as it pertains to Tariff Concession Orders (TCOs) are sections 269C, 269B, 269D, 269E, and 269P (subsection 3). These sections collectively establish the criteria for the application and issuance of a TCO. Specifically, section 269C requires that a TCO application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Definitions for key terms like "goods produced in Australia," "ordinary course of business," and "substitutable goods" are provided in sections 269B, 269D, and 269E respectively. If the Chief Executive Officer (CEO) of Customs is satisfied that the application meets these criteria, they must make a written order declaring the goods subject to the TCO (section 269P(3)).
The Act imposes specific obligations and requirements on both applicants and the CEO. An applicant must ensure that their application for a TCO is lodged correctly and includes all necessary information to meet the core criteria (section 269F). The CEO, on the other hand, is obligated to review the application to determine if it meets the core criteria and to make a written order if the application is valid. Additionally, the CEO must publish a notice in the Gazette, inviting any interested parties to lodge submissions if they believe the TCO should not be made (subsection 269K(1)). In this case, the CEO did not receive any submissions.
Failure to comply with the provisions of the Customs Act 1901 regarding TCOs may lead to various consequences. While the explanatory statement does not specify criminal offences, there could be civil penalties for non-compliance with the regulations and provisions set out in the Act. For instance, an incorrect application could result in the CEO rejecting the TCO request, which could lead to the applicant facing the standard duty rates instead of the concessional rate. Additionally, any party that deliberately provides false information in an application could face legal action for misrepresentation or fraud, depending on the jurisdiction and specific circumstances. The maximum penalties for such offences would depend on the relevant laws governing these civil and criminal actions.