EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0935358
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.
Srd Imports applied for a TCO in respect of certain head and neck restraint system on 21 September 2009.
Instrument
TCO No 0935358 was made on 27 November 2009. It declares that those certain head and neck restraint system 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. 0935358 is taken to have come into force on 21 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 Customs Act 1901, enacted by the Australian Parliament, establishes a framework through which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs. This legislative instrument addresses the need to provide tariff concessions for specific goods, thereby encouraging trade by reducing the customs duty burden on these goods. The explanatory statement for Tariff Concession Instrument No. 0935358, made under the Customs Act 1901, clarifies the process and criteria for such concessions. Srd Imports applied for a TCO concerning certain head and neck restraint systems on 21 September 2009, and the CEO issued TCO No. 0935358 on 27 November 2009, effective from the date of application. The instrument declares that these specific restraint systems are subject to a zero rate of duty, which is a reduction from the general rate of 5%. This concession was granted after the CEO determined that no substitutable goods were produced in Australia, fulfilling the core criteria under the Act. No submissions opposing the TCO were received, and the instrument does not disadvantage or impose liabilities on any person other than the Commonwealth.
Scope and Application
The Customs Act 1901, through Part XVA, facilitates the establishment of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, providing for a lower rate of customs duty on specific goods. This scheme applies to individuals or entities seeking a tariff concession for goods that are not produced in Australia and for which no substitutable goods are produced in the ordinary course of business. The application of this legislation is national, as it pertains to the Commonwealth, and its geographic reach extends to all imported goods within Australia. The Act does not apply to goods specified in section 269SJ, which lists items ineligible for tariff concessions. The TCO, once made, applies retroactively from the date the application was lodged, ensuring that no person (other than the Commonwealth) is disadvantaged or incurs liabilities for actions prior to the order’s registration. The process includes a requirement for the CEO to publish a notice in the Gazette inviting submissions on the application, although in this instance, no submissions were received.
Key Provisions
The Customs Act 1901, specifically under Part XVA, provides the framework for Tariff Concession Orders (TCOs) which are issued by the Chief Executive Officer of Customs (CEO). If an application for a TCO is made under section 269F, and the CEO determines that it does not pertain to goods specified in section 269SJ, they must assess whether the application meets the core criteria outlined in section 269C. For an application to meet these criteria, it must be the case that, on the date of the application, no substitutable goods were produced in Australia in the ordinary course of business (section 269C). Definitions for terms such as “goods produced in Australia,” “ordinary course of business,” and “substitutable goods” are provided in sections 269D, 269E, and 269F respectively. If the CEO is satisfied that the application meets these criteria, they must issue a written order as a TCO, as stipulated in subsection 269P(3).
The obligations imposed by the Customs Act 1901 on parties or entities it governs include the requirement for the CEO to thoroughly assess TCO applications against the core criteria. This involves ensuring that no substitutable goods are being produced in Australia at the time of the application. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any interested parties who might have objections to the TCO being issued, as required by subsection 269K(1). Failure to follow this process could render the TCO invalid. Furthermore, the Act mandates that a TCO comes into force on the date the application is lodged, unless otherwise specified (subsection 269S(1)).
The Act includes provisions for civil and criminal consequences for breaches of its requirements. For example, any person who knowingly contravenes the terms of a TCO or who provides false or misleading information in an application may be subject to penalties. Although the exact penalties are not specified in the provided text, such breaches could result in fines or other legal repercussions as determined by the relevant authorities. Additionally, any failure by the CEO to properly assess an application or to follow the required publication and consultation process could lead to administrative or judicial review, potentially resulting in the TCO being overturned or deemed invalid.