EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0926617
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.
Daniels International applied for a TCO in respect of certain transporter rotomoulded trolleys on 24 July 2009.
Instrument
TCO No 0926617 was made on 16 October 2009. It declares that those certain transporter rotomoulded trolleys 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. 0926617 is taken to have come into force on 16 October 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 Parliament of Australia, includes provisions for Tariff Concession Orders (TCOs) that allow for reduced customs duty on certain goods, provided they meet specific criteria. This legislation was introduced to address the need for flexibility in the application of customs duties, particularly to encourage the importation of goods that are not produced domestically. The Tariff Concession Instrument No. 0926617, made under the authority of the Act, aims to provide tariff relief to importers by reducing the duty on certain transporter rotomoulded trolleys from the standard rate to free of charge. This instrument was introduced following an application by Daniels International and was effective from the date of application lodgement, ensuring that no party is disadvantaged or incurs new liabilities due to its enactment.
Scope and Application
The Tariff Concession Order (TCO) No. 0926617 applies to the specific category of certain transporter rotomoulded trolleys, providing a lower rate of customs duty to the applicants, Daniels International. This concession is granted under Part XVA of the Customs Act 1901, which allows the Chief Executive Officer of Customs to make TCOs where the conditions outlined in the Act are satisfied. The application of the TCO is effective from the date the application was lodged, 24 July 2009, and came into force on 16 October 2009. The TCO is applicable nationally across Australia as it falls under the Commonwealth jurisdiction, and it specifically benefits the importer by reducing the duty rate from 5% to free. The order does not affect the rights of any person as at the date of registration and does not impose any liabilities on any person, except for the Commonwealth. Any exclusions or exemptions are governed by the provisions in section 269SJ of the Act, which details goods that cannot be subject to a TCO. The scope of the Act can be further extended or restricted through subordinate instruments as needed.
Key Provisions
The Tariff Concession Instrument No. 0926617, made under section 269F of the Customs Act 1901, applies a lower rate of customs duty to certain transporter rotomoulded trolleys, effective from the date the application was lodged, which is 24 July 2009. Under section 269C of the Act, the Chief Executive Officer of Customs (CEO) must assess whether the application for a Tariff Concession Order (TCO) meets the core criteria, specifically that no substitutable goods were produced in Australia on the day the application was lodged. In this instance, the CEO found that the application met these criteria and subsequently issued the TCO, effective from 16 October 2009, as per section 269S(1) of the Act. This TCO declares that the goods in question are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, resulting in a duty rate of free instead of the general 5%.
The obligations imposed by the Act on the parties involved include the requirement for applicants, such as Daniels International, to demonstrate that no substitutable goods are produced in Australia when applying for a TCO. The CEO is mandated by section 269K(1) to publish a notice in the Gazette inviting submissions from any interested parties who may have reasons against the TCO. In this case, no submissions were received. Furthermore, section 269S(1) ensures that the TCO takes effect from the date of the application, safeguarding the rights of existing importers and providing them with the opportunity to apply for duty refunds on goods imported since the effective date.
In terms of consequences for non-compliance, the Customs Act 1901 does not explicitly outline specific offences or penalties for breaches related to the issuance or application of TCOs. However, general provisions within the Act may apply, such as penalties for misrepresentation or incorrect declarations, which could include fines or imprisonment as prescribed under other relevant sections of the Act. The Act also ensures that the TCO does not disadvantage any person or impose liabilities on anyone in respect of actions taken before the TCO's effective date, thereby protecting the rights of importers and ensuring they can benefit from the reduced duty rates.