EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0919695
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.
Dux Manufacturing applied for a TCO in respect of certain water heater solar collector panels on 10 June 2009.
Instrument
TCO No 0919695 was made on 04 September 2009. It declares that those certain water heater solar collector panels 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. 0919695 is taken to have come into force on 10 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 Customs Act 1901, enacted by the Australian Parliament, establishes a framework for the regulation of customs duties and includes provisions for Tariff Concession Orders (TCOs). These orders, which can be made by the Chief Executive Officer of Customs, aim to provide relief from customs duty on certain goods, thereby encouraging trade and supporting specific industries. The 2010 Tariff Concession Instrument No. 0919695, created under the authority of the Customs Act, addresses the specific need for tariff relief on certain water heater solar collector panels. The policy objective is to foster the growth of the renewable energy sector by reducing the customs duty on these particular solar panels, thereby making them more competitive and accessible within the Australian market. This legislative action supports broader environmental and economic goals by promoting sustainable energy sources and facilitating their adoption in the domestic market.
Scope and Application
The Tariff Concession Instrument No. 0919695, made under the Customs Act 1901, applies to specific goods—in this case, certain water heater solar collector panels—that are subject to a Tariff Concession Order (TCO). The Act applies to any person or entity that imports these specified goods into Australia. The instrument was created following an application by Dux Manufacturing on 10 June 2009, which sought a tariff concession for the aforementioned panels. The geographic and jurisdictional reach of this Act is national, as it pertains to all imports into Australia. The Act excludes goods that are listed in section 269SJ of the Customs Act 1901, which outlines goods that cannot be subject to a TCO. The TCO itself came into force on the date the application was lodged, 10 June 2009, and it provides that the general rate of duty for these goods, which is 5%, is reduced to free under the specified TCO. This instrument does not affect the rights of any person as at the date of registration nor does it impose any liabilities on any person, thereby ensuring that no party is disadvantaged or subjected to new obligations by the concession.
Key Provisions
The Tariff Concession Order No. 0919695, established under section 269F of the Customs Act 1901, grants a tariff concession for certain water heater solar collector panels. This instrument was made following an application by Dux Manufacturing on 10 June 2009 and came into effect on the same date. The key provision of this TCO is the application of item 50 of Schedule 4 to the Customs Tariff Act 1995, which reduces the duty rate from the general rate of 5% to free, effective from the date of the application. This tariff concession is applicable only if the Chief Executive Officer (CEO) of Customs is satisfied that no substitutable goods were produced in Australia at the time the application was lodged, as per sections 269C and 269P(3) of the Act.
The obligations imposed by this Act primarily concern the CEO, who must determine the validity of the TCO application by assessing whether the core criteria outlined in section 269C are met. This involves verifying that no substitutable goods were produced in Australia at the time the application was made, with definitions for key terms provided in sections 269D, 269E, and 269F of the Act. The CEO is also required to publish a notice in the Gazette, inviting any interested parties to submit objections to the TCO, as stipulated in subsection 269K(1). Any submissions received must be considered before making the TCO. Furthermore, the Act ensures that the TCO does not affect the rights of any person, other than the Commonwealth, as at the date of registration, nor does it impose any liabilities on such persons, as per subsection 269S(1).
Under the Customs Act 1901, there are specific civil and administrative consequences for non-compliance with the requirements of a Tariff Concession Order. If any party fails to adhere to the terms and conditions set out in the TCO, they may be subject to penalties. These penalties can include fines and other administrative sanctions, though the exact penalties are not specified in the provided text. It is important for all parties involved to ensure strict compliance with the terms of the TCO to avoid any potential repercussions. Importers, however, may benefit from this TCO by applying for a refund of duty on goods imported since the TCO came into force, as provided under paragraph 126(1)(r) of the Regulations.