EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0921123
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.
Assa Abloy Hospitality Oceania applied for a TCO in respect of certain radio frequency indentification locks on 22 June 2009.
Instrument
TCO No 0921123 was made on 14 September 2009. It declares that those certain radio frequency indentification locks 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. 0921123 is taken to have come into force on 22 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 was enacted by the Australian Parliament to establish a regulatory framework for customs and border control, including the imposition of customs duties on imported goods. The Act provides mechanisms to grant tariff concessions through Tariff Concession Orders (TCOs), which can lower or eliminate customs duties on specified goods under certain conditions. Enacted to address the problem of ensuring fair trade practices and economic efficiency, the Customs Act 1901 allows the Chief Executive Officer of Customs to consider applications for TCOs from individuals or entities who can demonstrate that the goods in question are not substitutable by products manufactured in Australia. The objective of this legislation is to foster competitive markets by allowing the importation of goods that cannot be produced domestically, thereby supporting economic growth and consumer choice.
Scope and Application
The Tariff Concession Instrument No. 0921123 under the Customs Act 1901 applies to the specific radio frequency identification locks for which Assa Abloy Hospitality Oceania made an application. The instrument pertains to goods that are subject to a lower rate of customs duty if certain conditions are met, such as the absence of substitutable goods produced in Australia. The instrument is made by the Chief Executive Officer of Customs, who has the authority to declare the goods eligible for a tariff concession if they meet the core criteria outlined in the Act. This process ensures that the goods are not substitutable by Australian-produced items and that the application aligns with the specified criteria. The geographic reach of this instrument is national, as it pertains to goods imported into Australia and governed by the Customs Act 1901. The instrument does not impose any liabilities on persons other than the Commonwealth and does not affect any pre-existing rights of individuals except to beneficially alter the rights of importers regarding duty refunds for goods imported since the instrument's effective date.
Key Provisions
The primary sections of Tariff Concession Instrument No. 0921123 under the Customs Act 1901 (section 269F) allow the Chief Executive Officer of Customs (CEO) to make Tariff Concession Orders (TCO) for certain goods. This instrument specifically addresses the application for a TCO made by Assa Abloy Hospitality Oceania for radio frequency identification locks on 22 June 2009, and its subsequent approval on 14 September 2009. The instrument declares that the radio frequency identification locks in question are subject to a concession, such that the general rate of duty of 5% is reduced to free. This concession applies to goods as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995.
Under the Act, the CEO is mandated to consider the application and determine if it meets the core criteria, specifically if no substitutable goods were produced in Australia on the day the application was lodged (section 269C). Given that no such goods were produced, the CEO was obliged to make the TCO. The Act further requires that as soon as practicable after accepting the application, the CEO must publish a notice in the Gazette inviting submissions from any interested parties (subsection 269K(1)). In this instance, no submissions were received.
Entities or individuals subject to the Act must adhere to the conditions set out in the TCO. Specifically, they must ensure that the goods in question are those specified in the TCO and that they are imported in compliance with the terms of the concession. The TCO benefits importers by potentially allowing them to apply for a refund of duties paid on the goods since the effective date of the TCO (subsection 126(1)(r) of the Regulations).
Failure to comply with the conditions of the TCO may result in legal consequences. While the explanatory statement does not detail specific offences or penalties, breaches of the Customs Act 1901 or associated regulations can lead to civil or criminal penalties, including fines and imprisonment. The exact penalties would depend on the nature and severity of the breach, as outlined in the relevant sections of the Act and subsidiary legislation.