EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0921808
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.
Transpacific Superior applied for a TCO in respect of certain garbage bins mobile on 25 June 2009.
Instrument
TCO No 0921808 was made on 18 September 2009. It declares that those certain garbage bins mobile 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. 0921808 is taken to have come into force on 25 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 to regulate the importation and exportation of goods, including the imposition and remission of customs duties. The Act was introduced to address the need for a structured framework governing the customs process in Australia, ensuring that trade activities are conducted within a regulated environment. The explanatory statement for Tariff Concession Instrument No. 0921808, issued under the authority of the Customs Act, outlines the mechanism for granting tariff concessions to certain goods. This instrument was developed in response to an application by Transpacific Superior for a tariff concession order (TCO) concerning specific garbage bins mobile. The objective is to facilitate trade by reducing the duty on these goods, provided no substitutable goods are produced in Australia, thereby encouraging import and use of these items. The instrument was issued by the Chief Executive Officer of Customs, who assessed the application against the criteria set out in the Customs Act.
Scope and Application
The Customs Act 1901, through Part XVA, establishes a scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (CEO). These orders apply to specific goods and provide for a lower rate of customs duty than would otherwise be applicable under the Customs Tariff Act 1995. Any person can apply for a TCO, provided the goods in question do not fall under the exclusions specified in section 269SJ of the Customs Act 1901. The CEO must determine if the application meets the core criteria, such as whether substitutable goods are produced in Australia in the ordinary course of business, as defined in sections 269D and 269E of the Act. If the application is deemed to meet these criteria, a TCO is issued, as occurred with TCO No. 0921808 for certain mobile garbage bins on 18 September 2009, which lowered the duty rate to free from the general rate of 5%. The TCO applies nationwide and is effective from the date of the application, without disadvantaging any existing rights or imposing new liabilities on persons other than the Commonwealth.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0921808 are sections 269C, 269F, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO) for goods. If the CEO is satisfied that the application meets the core criteria, they must make a written order under section 269P. Section 269C specifies that an application meets the core criteria if no substitutable goods were produced in Australia on the day the application was lodged. This instrument declares that certain garbage bins mobile are goods to which item 50 of Schedule 4 to the Customs Tariff Act 1995 applies, thereby granting a tariff concession.
The Act imposes certain obligations on the parties it governs. For instance, under section 269K, the CEO must publish a notice in the Gazette, inviting submissions from any person who may have reasons why the TCO should not be made. This is to ensure transparency and allow for public input before the order is finalised. The CEO must also ensure that the application meets the core criteria, as specified in section 269C, before making the TCO. Additionally, the CEO must consider the definitions provided in sections 269D, 269E, and 269F when determining whether a TCO application meets the criteria.
Failure to comply with the provisions of the Customs Act 1901 can lead to various civil or criminal consequences. Under section 307 of the Customs Act, any person who contravenes a provision of the Act is liable to a penalty not exceeding the greater of three times the amount of duty that would have been payable if the provision had not been contravened or $1,100. Furthermore, in the case of an offence against a provision of the Customs Act, a court may impose a penalty of up to $22,000 for an individual and up to $110,000 for a body corporate. These penalties underscore the seriousness with which the law treats non-compliance, ensuring that parties adhere to the prescribed regulations.