EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0948288
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.
J. T. Day Pty Ltd applied for a TCO in respect of certain light fitting enclosures on 10 December 2009.
Instrument
TCO No 0948288 was made on 26 February 2010. It declares that those certain light fitting enclosures 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. 0948288 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 Parliament of Australia, provides a framework for the administration of customs and excise. The Act was amended to introduce Tariff Concession Orders (TCOs) through Part XVA, addressing the need for a mechanism to provide tariff relief for specific goods that are not produced domestically or are produced in limited quantities. The 2010 Explanatory Statement for Tariff Concession Instrument No. 0948288 clarifies the process for making such orders, whereby the Chief Executive Officer of Customs can grant a TCO if the applicant demonstrates that the goods in question are not substitutable by Australian-produced goods. The policy objective is to support Australian industries by ensuring that the concession applies only to goods for which there is no domestic production, thereby protecting local manufacturers from unfair competition. The Tariff Concession Order No. 0948288, made on 26 February 2010, pertains to certain light fitting enclosures, granting them a zero-rate duty as of the date the application was lodged, 10 December 2009.
Scope and Application
The Tariff Concession Instrument No. 0948288, made under the Customs Act 1901, applies to specific light fitting enclosures for which J. T. Day Pty Ltd submitted an application for tariff concessions. The Act provides a framework for the Chief Executive Officer of Customs to grant reduced customs duty rates on goods, contingent on the application meeting certain criteria, such as the absence of substitutable goods produced in Australia. The application of this legislation is national in scope, extending across all jurisdictions within Australia. Notably, the Act does not affect the rights of any person, other than the Commonwealth, concerning actions taken before the concession order's effective date. The instrument came into force on the date the application was lodged, which was 10 December 2009. Any person can challenge the making of a Tariff Concession Order, although in this instance, no submissions were received. The application of this legislation may be further detailed or modified through subordinate instruments, such as regulations, which can specify additional conditions or exceptions not explicitly covered in the primary Act.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0948288, made under the Customs Act 1901, establish the framework for the application and issuance of Tariff Concession Orders (TCOs). Under section 269F, any person can apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of certain goods. The CEO must then determine whether the application meets the core criteria set out in sections 269B and 269C, particularly focusing on whether substitutable goods are produced in Australia. If the application is deemed valid, a TCO is issued pursuant to section 269P(3). This specific TCO No. 0948288 applies to certain light fitting enclosures, which are now subject to a duty rate of free, as opposed to the general rate of 5%.
The Act imposes several obligations on the parties involved. For the applicant, it requires a formal application to the CEO for a TCO. The CEO, upon receiving the application, must assess whether it meets the criteria specified in the Act. This includes ensuring that no substitutable goods are produced in Australia. Furthermore, the CEO must publish a notice in the Gazette inviting submissions from any interested parties who may have reasons to oppose the TCO, as per subsection 269K(1). The CEO did not receive any submissions in response to the notice for TCO No. 0948288. Once a TCO is issued, it comes into force on the date the application was lodged, as per subsection 269S(1).
Breaching the requirements of the Customs Act 1901 can lead to significant consequences. Offences under the Act may result in both civil and criminal penalties. While the specific penalties are not detailed in the explanatory statement, it is known that contraventions of the Act can lead to fines and, in more severe cases, imprisonment. For instance, wilful misrepresentation or providing false information in an application for a TCO can attract penalties under section 269D of the Act. These penalties serve as deterrents to ensure compliance with the statutory requirements and the integrity of the tariff concession process.
In summary, the Tariff Concession Instrument No. 0948288 under the Customs Act 1901 allows for reduced duty rates on certain goods through the issuance of TCOs, provided specific criteria are met. The obligations for the applicant and the CEO are clearly defined, and any breaches can result in substantial penalties, both civil and criminal, to maintain the Act’s efficacy and enforce compliance.