EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0934676
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.
The Promotions Factory Aust Pty Ltd applied for a TCO in respect of certain digital disk storage units on 16 September 2009.
Instrument
TCO No 0934676 was made on 27 November 2009. It declares that those certain digital disk storage units 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. 0934676 is taken to have come into force on 16 September 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. 0934676 was introduced under the Customs Act 1901 to provide a tariff concession for certain digital disk storage units, facilitating their importation into Australia with a reduced rate of customs duty. Enacted in 2009, this legislation aims to address the economic gap by reducing import costs for these specific goods, thereby potentially lowering consumer prices and stimulating market competition. The instrument was made by the Chief Executive Officer of Customs, who assessed and approved the application from The Promotions Factory Aust Pty Ltd, finding that no substitutable goods were produced in Australia at the time of application. This instrument ensures that the rights of existing parties are not adversely affected, while offering benefits to importers who may apply for duty refunds on eligible imports since the date of the instrument's effective commencement.
Scope and Application
The Tariff Concession Order No. 0934676 under the Customs Act 1901 applies to specific digital disk storage units, reducing their customs duty from the general rate of 5% to free. This applies to entities or persons importing these goods, making the concession effective from the date the application was lodged, 16 September 2009. The Act governs this process through its provision for Tariff Concession Orders (TCOs), which can be applied for by any person and are subject to the approval of the Chief Executive Officer of Customs, provided the goods do not fall under the specified exclusions. The geographic reach of this Act is national, as it operates under the Commonwealth’s authority, affecting all importers within Australia. Exclusions include goods specified in section 269SJ of the Act, which cannot be subject to a TCO. The Act may extend its application through subordinate instruments, although no specific exclusions or thresholds are noted in this particular TCO. The order does not disadvantage or impose liabilities on any person other than the Commonwealth, and it allows for potential duty refunds for importers of these goods since the effective date of the TCO.
Key Provisions
The Tariff Concession Instrument No. 0934676, pursuant to section 269F of the Customs Act 1901, establishes a tariff concession order (TCO) for certain digital disk storage units, allowing for a reduction in the duty rate from 5% to free. This concession applies to goods that meet the core criteria specified under section 269C of the Act, which requires that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Under section 269P(3), once the Chief Executive Officer of Customs (CEO) is satisfied that these criteria are met, a written order is issued as a TCO.
The Act imposes several obligations on the parties involved. Firstly, the applicant, such as The Promotions Factory Aust Pty Ltd, must ensure that their application for a TCO is valid and meets the core criteria as outlined in the Act (section 269C). The CEO has the responsibility to review the application, verify that it is not in respect of goods specified in section 269SJ, and determine if the core criteria are satisfied. If the CEO decides to proceed with the TCO, they must issue a written order specifying the tariff concession, as mandated by section 269P(3). Additionally, the CEO is required to publish a notice in the Gazette under subsection 269K(1) to invite submissions from any interested parties who may oppose the TCO, although in this case, no submissions were received.
Failure to comply with the provisions of the Customs Act 1901 and the associated regulations may result in civil or criminal consequences. While the explanatory statement does not detail specific penalties for breaches related to TCOs, general provisions within the Customs Act may include fines or imprisonment for non-compliance with customs regulations. The specific penalties for breaches would be determined based on the relevant sections of the Act and any applicable regulations. It is important to note that the TCO does not impose any liabilities on any person and does not affect the rights of a person, other than the Commonwealth, as at the date of registration.