EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0948580
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.
Thiess John Holland applied for a TCO in respect of certain support frame and work platforms on 14 December 2009.
Instrument
TCO No 0948580 was made on 05 March 2010. It declares that those certain support frame and work platforms 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. 0948580 is taken to have come into force on 14 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 Tariff Concession Instrument No. 0948580, enacted in 2010, pertains to the Customs Act 1901 and addresses the need for tariff concessions on specific goods to promote economic efficiency and competitive neutrality in the Australian market. This instrument was introduced by the Chief Executive Officer of Customs in response to an application from Thiess John Holland for tariff concessions on certain support frame and work platforms. The objective is to ensure that no substitutable goods are produced in Australia, thereby qualifying these imported goods for a lower rate of customs duty, effectively zero percent in this case, as opposed to the general rate of 5%. The instrument was made following a review of the application and no submissions opposing the concession, and it came into force on the date the application was lodged, 14 December 2009. This legislative action ensures that importers can benefit from a tariff reduction while maintaining the rights of other stakeholders.
Scope and Application
The Customs Act 1901 applies to the administration of customs and excise in Australia and includes provisions for the establishment of Tariff Concession Orders (TCOs) to lower the rate of customs duty on specific goods. Section 269F of the Act allows any person to apply to the Chief Executive Officer of Customs (CEO) for a TCO, provided that the goods in question are not those specified in section 269SJ of the Act, which cannot be subject to a TCO. If the CEO is satisfied that the application meets the core criteria, outlined in section 269C, a TCO will be made under section 269P(3). The CEO must also publish a notice in the Gazette inviting submissions, as required by subsection 269K(1), though in the case of TCO No 0948580, no submissions were received. The TCO applies to goods that meet the specified criteria, such as the certain support frame and work platforms in this instance, and comes into force on the date the application was lodged. Importantly, the TCO does not affect the rights of any person as at the date of registration and does not impose any liabilities on any person. Instead, it benefits importers by allowing them to apply for a refund of duty on goods imported since the TCO came into force.
Key Provisions
Section 269F (1) of the Customs Act 1901 allows a person to apply to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO) regarding specific goods. If the CEO determines that the application pertains to goods not listed in section 269SJ of the Act, which outlines goods ineligible for a TCO, the CEO then assesses whether the application meets the core criteria as specified in section 269C. If no substitutable goods were produced in Australia on the day the application was lodged, as defined by section 269D and section 269E, the CEO must issue a written TCO order.
The Act imposes specific obligations on the parties involved. The CEO must promptly publish a notice in the Gazette after receiving a valid TCO application, inviting any interested parties to submit any reasons why the TCO should not be made, as stipulated in subsection 269K(1). In this particular case, Thiess John Holland applied for a TCO concerning certain support frame and work platforms, and no submissions were received by the CEO. The TCO comes into force on the date the application was lodged, in line with subsection 269S(1), which means the concession is retroactive to the date of application.
Under section 269P(3), if the CEO is satisfied that a TCO application meets the core criteria, they must make an order specifying that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. In TCO No. 0948580, the CEO declared that certain support frame and work platforms are subject to item 50 of Schedule 4, with a duty rate of free, rather than the general rate of 5%. This TCO does not affect the rights of any person, except the Commonwealth, in relation to actions taken before the TCO's effective date, as per the Act.
There are specific consequences for breach of the provisions outlined in the Customs Act 1901. While the explanatory statement does not detail specific penalties for non-compliance with TCOs, breaches of other sections of the Customs Act could result in penalties. For example, section 126 of the Customs Regulations 1993 specifies offences and penalties, which could include fines or imprisonment. However, the TCO itself does not impose any liabilities on any person, ensuring that only the rights of the Commonwealth remain unaffected.