EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0948193
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 Trustee for the Bob Littler Family Trust applied for a TCO in respect of certain anchor winches on 10 December 2009.
Instrument
TCO No 0948193 was made on 5 March 2010. It declares that those certain anchor winches 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. 0948193 is taken to have come into force on 10 December 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, provides a framework under which Tariff Concession Orders (TCOs) may be made to reduce the rate of customs duty on specific goods. The Customs Act 1901 aims to streamline and facilitate international trade by allowing for reduced tariffs on certain goods, provided they meet the criteria set out in the Act. The Chief Executive Officer of Customs is responsible for making these orders following applications from interested parties. The Tariff Concession Instrument No. 0948193, made under the authority of the Customs Act 1901, addresses the specific case of certain anchor winches, reducing their duty rate from the general rate of 5% to free of charge. This instrument was introduced to support the application by the Trustee for the Bob Littler Family Trust, ensuring that no substitutable goods were produced in Australia at the time of the application. The policy objective is to encourage the import of specific goods that are not domestically produced, thereby benefiting importers and potentially stimulating trade.
Scope and Application
The Customs Act 1901, specifically under Part XVA, outlines the process for making Tariff Concession Orders (TCOs) through which the Chief Executive Officer (CEO) of Customs can apply a lower rate of customs duty on certain goods. This Act applies to individuals and entities who apply for a TCO and to the goods specified in such applications. The CEO must ensure that the goods in question are not listed in section 269SJ, which details goods ineligible for tariff concessions, and that they meet the core criteria set out in section 269C. The application must be made on the basis that no substitutable goods are produced in Australia, as defined in sections 269D and 269E. If these conditions are met, the CEO issues a written order, a TCO, that specifies the reduced duty on the goods as per the Customs Tariff Act 1995. The CEO is also required to publish a notice in the Gazette inviting submissions on the proposed TCO, although no submissions were received for TCO No. 0948193. The TCO is effective from the date the application was lodged, and it does not affect the rights of any person other than the Commonwealth in relation to actions taken before the TCO's registration. The Act provides for the application of subordinate instruments to extend or further define the application of the primary legislation.
Key Provisions
The Tariff Concession Instrument No. 0948193, under the Customs Act 1901, focuses on the establishment of Tariff Concession Orders (TCOs) for specific goods, as per sections 269F and 269C (1). If a person applies to the Chief Executive Officer (CEO) of Customs for a TCO concerning certain goods, and the CEO is convinced that the application pertains to goods that do not fall under the prohibitions listed in section 269SJ, the CEO must assess whether the application meets the fundamental criteria stipulated in section 269C. If the CEO confirms that no equivalent goods are produced in Australia in the ordinary course of business, as defined in sections 269D and 269E, then a TCO will be issued.
The obligations under the Customs Act 1901 for the parties involved are quite clear. The applicant must ensure their request for a TCO is valid and that the goods in question do not contravene the exclusions listed in section 269SJ. The CEO has the duty to review the application, verify its eligibility against the core criteria, and if satisfied, to issue a written TCO as mandated by section 269P(3). The CEO must also publish a notice in the Gazette under subsection 269K(1), inviting any interested parties to submit objections to the TCO if they believe it should not proceed. If no objections are received, the CEO is obligated to proceed with the TCO.
In terms of legal consequences for non-compliance, the Act does not specify detailed penalties or offences directly related to the issuance or breach of a TCO. However, it is important to note that the Act ensures the rights of non-Commonwealth persons are not adversely affected by the TCO, as per subsection 269S(1). There are no liabilities imposed on any individual as a result of the TCO. Importers, however, may benefit from this instrument by applying for a refund of duties on goods imported since the effective date of the TCO, as per paragraph 126(1)(r) of the Regulations.