EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1009280
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.
Auto Electrical Imports applied for a TCO in respect of certain reversing alarms on 22 February 2010.
Instrument
TCO No 1009280 was made on 07 May 2010. It declares that those certain reversing alarms 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. 1009280 is taken to have come into force on 22 February 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 Customs Act 1901, enacted by the Australian Parliament, provides a framework for the regulation of customs duties and related matters. Part XVA of this Act establishes a scheme through which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs. These TCOs apply lower rates of customs duty to specified goods. This legislative framework was designed to address the need for streamlined customs processes and to offer relief to businesses by reducing the cost of importing certain goods. The Tariff Concession Instrument No. 1009280, issued on 7 May 2010, exemplifies this by applying to specific reversing alarms, effectively granting them a free rate of duty instead of the general rate of 5%. This measure aims to facilitate the importation of these goods without imposing any liabilities on individuals or entities, thereby benefiting importers who can apply for duty refunds on imports made since the effective date of the TCO.
Scope and Application
The Customs Act 1901, specifically under Part XVA, facilitates the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, designed to lower customs duty rates for certain goods. The application process is initiated by a person who applies to the CEO for a TCO, provided the goods do not fall under the restricted category specified in section 269SJ of the Act. If the CEO determines that the application meets the core criteria outlined in sections 269C, 269B, and 269D, a TCO is issued. Notably, a TCO was issued on 7 May 2010, for certain reversing alarms, declaring them eligible for a zero-duty rate under item 50 of Schedule 4 to the Customs Tariff Act 1995, effective from 22 February 2010, the date the application was lodged. The CEO must publish a notice in the Gazette inviting submissions on the TCO application, although no submissions were received for this specific TCO. This legislative mechanism aims to benefit importers by potentially allowing them to claim refunds for duties paid on the specified goods imported since the TCO's effective date, without imposing any liabilities on individuals.
Key Provisions
The Tariff Concession Instrument No. 1009280 under the Customs Act 1901 (the Act) establishes a tariff concession order (TCO) for certain reversing alarms, allowing for the application of a lower rate of customs duty on these goods. The key operative section, section 269F, allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a TCO in respect of goods, provided that the goods are not specified in section 269SJ of the Act, which excludes certain goods from TCOs. Section 269C stipulates that a TCO application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. If the CEO is satisfied that the application meets these criteria, section 269P(3) mandates that 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 applies.
The Act imposes several obligations on the parties it governs. Under section 269K(1), the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. This ensures transparency and allows interested parties to provide input on the application. Additionally, section 269S(1) states that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged, which in this case is 22 February 2010. The CEO must also ensure that the rights of a person (other than the Commonwealth) are not disadvantaged by the TCO as at the date of registration, and that no liabilities are imposed on any person in respect of anything done or omitted to be done before the date of registration.
There are no explicit offences, penalties, or civil/criminal consequences detailed for breach of the provisions within the explanatory statement. However, the Act's broader framework likely includes enforcement mechanisms and penalties for non-compliance, as is typical for statutory regulations. The focus of this specific instrument is on the procedural aspects of applying for and implementing a tariff concession, rather than on punitive measures for non-compliance with the TCO itself. The key concern is ensuring that the process is fair and transparent, and that the rights of all parties involved are protected.