EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1005235
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.
Toshiba Pty Ltd applied for a TCO in respect of certain chargers and adapters on 29 January 2010.
Instrument
TCO No 1005235 was made on 23 April 2010. It declares that those certain chargers and adapters 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. 1005235 is taken to have come into force on 29 January 2010.
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. 1005235, enacted in 2010 under the Customs Act 1901, was introduced to address the need for tariff concessions on certain goods. The Customs Act 1901 allows for Tariff Concession Orders (TCOs) to be made by the Chief Executive Officer of Customs, providing a lower rate of customs duty on goods specified in such orders. This instrument was enacted by the Australian Parliament and is intended to support the policy objective of reducing the customs duty on specific goods, thereby making them more competitively priced and accessible within the domestic market. The process for granting a TCO involves an application by an interested party, followed by an assessment by the CEO of Customs to determine if the application meets the core criteria, such as the absence of substitutable goods produced in Australia. This particular instrument, TCO No. 1005235, was made in response to an application by Toshiba Pty Ltd for certain chargers and adapters, which was accepted as the CEO determined that no substitutable goods were produced in Australia at the time of application.
Scope and Application
The Tariff Concession Instrument No. 1005235, made under the Customs Act 1901, applies to specific chargers and adapters for which Toshiba Pty Ltd has applied for tariff concessions. This instrument was created in response to Toshiba's application to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO), seeking reduced customs duty rates on certain imported goods. The Act mandates that a TCO can be issued if no substitutable goods are produced in Australia, which was determined to be the case for these particular items. The TCO sets the duty rate for these goods at zero, down from the general rate of 5%. The instrument extends to the Commonwealth level and applies to any entity or individual importing the specified goods into Australia. The TCO does not affect any rights or liabilities of individuals or entities except to the extent that it may provide for a refund of duties paid on imports before the TCO's effective date. The instrument was published in the Gazette, inviting submissions but received none, and it came into effect on the date of the application, 29 January 2010.
Key Provisions
The Tariff Concession Instrument No. 1005235, made under the Customs Act 1901, establishes a tariff concession order (TCO) for certain chargers and adapters, effective from 29 January 2010 (section 269S). This order, made by the Chief Executive Officer of Customs (CEO), stipulates that these specific items are subject to a free rate of duty rather than the general rate of 5% (section 269P(3)). The CEO was satisfied that no substitutable goods were produced in Australia on the day the application was lodged, thus meeting the core criteria set out in sections 269C and 269D of the Act.
The Act imposes several obligations and requirements on the parties it governs. Firstly, it mandates that any person seeking a TCO must submit an application to the CEO, who must then assess whether the application meets the core criteria (section 269F). If the CEO determines that the application meets these criteria, they are required to make a written order specifying the prescribed item of Schedule 4 to the Customs Tariff Act 1995 that applies to the goods in question (section 269P(3)). Additionally, the CEO must publish a notice in the Gazette inviting any interested party to lodge a submission if they believe the TCO should not be made (subsection 269K(1)). In this case, no submissions were received.
In terms of potential consequences, any breach of the requirements set out in the Customs Act 1901 may lead to civil or criminal penalties. While the explanatory statement does not explicitly detail the penalties, it is known that the Act provides for various sanctions, including fines and imprisonment, for non-compliance with its provisions. The exact penalties would depend on the nature and severity of the breach, as outlined in other sections of the Act and relevant regulations. The Act ensures that the TCO does not adversely affect the rights of any person, including importers, who may benefit from refunds of duty paid on imports since the effective date of the TCO (paragraph 126(1)(r) of the Regulations).