EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1012393
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.
IWorld Australia Pty Ltd applied for a TCO in respect of certain power supplies on 11 March 2010.
Instrument
TCO No 1012393 was made on 04 June 2010. It declares that those certain power supplies 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. 1012393 is taken to have come into force on 11 March 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 was enacted by the Commonwealth Parliament to regulate the importation and exportation of goods, including the imposition of customs duties and tariffs. The Act provides a framework under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (CEO) to reduce the customs duty on certain goods. F2010L02365, also known as Tariff Concession Instrument No. 1012393, was introduced to address the specific need for tariff concessions on certain power supplies, as requested by World Australia Pty Ltd. The instrument was made on 04 June 2010 and declares that the certain power supplies are goods to which a free rate of duty applies, as no substitutable goods were produced in Australia. The instrument ensures that the rights of importers are beneficially affected and that no liabilities are imposed on any person under the TCO.
Scope and Application
The Tariff Concession Instrument No. 1012393 applies to certain power supplies as specified in the instrument, establishing a lower rate of customs duty for these goods under the Customs Act 1901. The application of this instrument is governed by the core criteria outlined in the Act, specifically under sections 269C, 269D, and 269E, which require that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. The instrument was made on 04 June 2010, and it declares that the specified power supplies are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, resulting in a duty-free rate for these goods. The CEO of Customs made this decision after satisfying themselves that the application met the core criteria and no submissions were received in opposition to the application. The instrument's effect is retrospective to the date the application was lodged, 11 March 2010, and it does not disadvantage any person or impose new liabilities, though it does allow for duty refunds for importers under the Customs Act.
Key Provisions
The Customs Act 1901, through Part XVA, provides a framework for the Chief Executive Officer of Customs (CEO) to issue Tariff Concession Orders (TCOs) (s 269F). These orders allow for a lower rate of customs duty on specific goods, provided the application for a TCO meets certain criteria. According to section 269C, the core criteria include that on the date of the application, no substitutable goods were produced in Australia in the ordinary course of business. Further, section 269B clarifies that "goods produced in Australia" and "ordinary course of business" are defined by sections 269D and 269E, respectively. Section 269P(3) mandates that if the CEO is satisfied the application meets these criteria, they must issue a written TCO.
The obligations imposed by the Act on parties or entities include the requirement for the CEO to assess whether the application meets the core criteria (s 269C). If the application is valid and the CEO determines that no substitutable goods were produced in Australia in the ordinary course of business, the CEO must issue a TCO (s 269P(3)). Additionally, the CEO must publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made (s 269K(1)). This notice must be published as soon as practicable after accepting the TCO application as valid.
The Act also sets out consequences for breaches of its provisions. However, the specific offences, penalties, or civil and criminal consequences for breach are not detailed within the provided excerpt. Typically, breaches of customs legislation can result in significant penalties, including fines and imprisonment, depending on the severity of the breach. For example, under the Crimes Act 1914, fraudulent customs offences can attract penalties of up to 10 years imprisonment, while less severe breaches might incur fines and other administrative penalties. The precise penalties would depend on the specific nature of the breach and the discretion of the court.