EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1009472
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.
Obrien Glass Industries applied for a TCO in respect of certain passenger motor vehicle safety glass on 23 February 2010.
Instrument
TCO No 1009472 was made on 14 May 2010. It declares that those certain passenger motor vehicle safety glass 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. 1009472 is taken to have come into force on 23 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 Commonwealth Parliament, provides a framework for the administration of customs duties and the regulation of imports and exports in Australia. The Tariff Concession Instrument No. 1009472, introduced in 2010, addresses a specific gap in the Customs Act by enabling the Chief Executive Officer of Customs to grant tariff concessions on certain goods. This instrument was developed in response to an application by O'Brien Glass Industries for a tariff concession order concerning certain passenger motor vehicle safety glass. The policy objective of this instrument is to facilitate the import of goods by applying a reduced or free rate of customs duty, provided no substitutable goods are produced in Australia, thereby encouraging trade and economic activity. The instrument ensures that the rights of importers are positively affected and that no new liabilities are imposed on any person as a result of its implementation.
Scope and Application
The Customs Act 1901, through the Tariff Concession Instrument No. 1009472, applies to the application and consideration of Tariff Concession Orders (TCOs) for goods that are not substitutable and not produced in Australia. This Act is applicable at a Commonwealth level and pertains to entities or individuals seeking to import specific goods, such as certain passenger motor vehicle safety glass, into Australia. The legislation specifies that if no substitutable goods are produced in Australia, the Chief Executive Officer of Customs (CEO) must make a written order granting a concession, which in this case, allows for the free import of specified goods. The TCO applies nationally and does not affect any rights or liabilities accrued before its effective date, which aligns with the date the application was lodged. The scope of this legislation ensures that the application process is transparent, with an opportunity for public submissions, although in this instance, no submissions were received. This Act extends its application through subordinate instruments, specifically referencing the Customs Tariff Act 1995 and related regulations for duty refunds.
Key Provisions
The main operative sections of this legislation revolve around the ability of the Chief Executive Officer (CEO) of Customs to make Tariff Concession Orders (TCOs) under section 269F of the Customs Act 1901. Section 269C sets out the core criteria that an application must meet for a TCO to be made, specifically that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Section 269P(3) mandates that if the CEO is satisfied that the application meets the core criteria, a written TCO must be made declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The obligations imposed by the Act on parties or entities it governs primarily concern the process for applying for a TCO. Under section 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any person who may have reasons to oppose the making of a TCO. This ensures a level of transparency and opportunity for interested parties to voice their concerns. Additionally, the Act specifies that a TCO is taken to have come into force on the date the application was lodged, as per subsection 269S(1).
Any breach of the obligations or requirements set out in the Act can lead to various consequences. However, the explanatory statement does not explicitly outline specific offences, penalties, or consequences for breach within this context. Instead, it focuses on the procedural requirements and the benefits for importers, such as the ability to apply for a refund of duty on goods imported since the TCO came into force under paragraph 126(1)(r) of the Regulations. It is important to note that the TCO does not impose any liabilities on any person, ensuring that the rights of importers are beneficially affected without disadvantage or imposition of liabilities prior to the registration date of the TCO.