EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0926745
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.
Ferno Australia Pty Ltd applied for a TCO in respect of certain stretchers rescue on 24 July 2009.
Instrument
TCO No 0926745 was made on 12 October 2009. It declares that those certain stretchers rescue 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. 0926745 is taken to have come into force on 24 July 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. 0926745, enacted under the Customs Act 1901, addresses the issue of facilitating access to goods that are not produced domestically, thereby ensuring competitive pricing and availability in the Australian market. This legislative instrument allows for tariff concessions on specified goods, provided that no substitutable goods are produced in Australia in the ordinary course of business. The Customs Act 1901, enacted by the Australian Parliament, establishes the framework for applying tariff concessions through Tariff Concession Orders (TCOs), which are issued by the Chief Executive Officer of Customs (CEO) upon meeting certain criteria. The primary policy objective of this instrument is to encourage the importation of goods that are either not produced locally or are produced at a higher cost, thus enhancing market access and affordability for consumers. This mechanism supports the broader economic policy of promoting competitive markets while ensuring that local industries are not unduly disadvantaged.
Scope and Application
The Customs Act 1901 applies to the process of applying for and granting Tariff Concession Orders (TCOs), which are instruments that lower the customs duty on certain goods. These orders are applicable to individuals or entities seeking to import goods that are not currently being produced in Australia and that have a corresponding use or design for which Australian-made goods are not available. The application process involves submitting an application to the Chief Executive Officer of Customs, who must assess whether the application meets the core criteria, such as the non-existence of substitutable goods produced in Australia. If the criteria are met, a TCO is issued, reducing the customs duty on the specified goods. The geographic reach of this legislation is national, as it pertains to imports into Australia. The TCO No. 0926745, for example, applies to specific rescue stretchers, reducing their duty rate from the general 5% to free, effective from the date the application was lodged. The legislation ensures that existing rights and liabilities are protected, and it mandates public consultation on new TCOs. Any exclusions or exemptions are limited to goods specified under section 269SJ of the Act, which cannot be subject to a TCO.
Key Provisions
The main operative sections of this legislation, specifically Tariff Concession Instrument No. 0926745, involve the application and determination of Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269F allows for an application to be made to the Chief Executive Officer (CEO) of Customs for a TCO in respect of certain goods. Section 269C outlines the core criteria that the CEO must consider when deciding whether to grant a TCO, including the requirement that no substitutable goods were produced in Australia at the time of the application (section 269D). If the CEO determines that these criteria are met, a TCO is issued under section 269P(3), which specifies the reduced duty rate applicable to the goods in question.
The obligations imposed by this Act on the parties it governs are primarily on the CEO of Customs, who is tasked with reviewing applications for TCOs and determining whether they meet the core criteria (sections 269F and 269C). The CEO must also publish a notice in the Gazette inviting submissions from interested parties once an application is deemed valid (subsection 269K(1)). Additionally, section 269S(1) specifies that a TCO comes into force on the day the application is lodged, and the rights of importers are beneficially affected under paragraph 126(1)(r) of the Regulations, which allows for duty refunds on goods imported since the TCO's effective date.
Regarding offences, penalties, or consequences for breach, the Act does not explicitly detail specific criminal or civil penalties for failing to comply with the terms of a TCO or for making a false application. However, general provisions within the Customs Act 1901 and related regulations could apply to breaches involving customs duties, potentially leading to fines or other penalties. The Act ensures that the rights of non-Commonwealth entities are not adversely affected by the issuance of a TCO, and it does not impose any liabilities on any person as a result of the TCO (subsection 269S(1)). Therefore, while there are no direct penalties outlined in this particular instrument, the broader framework under which the Customs Act operates may impose consequences for non-compliance.