EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1031199
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.
Maxwell International Australia applied for a TCO in respect of certain tripods or monopods on 08 July 2010.
Instrument
TCO No 1031199 was made on 06 October 2010. It declares that those certain tripods or monopods 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. 1031199 is taken to have come into force on 08 July 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 Parliament of Australia, established a framework within which Tariff Concession Orders (TCOs) could be made by the Chief Executive Officer of Customs (CEO). This legislation was introduced to address the need for a scheme that would allow for lower rates of customs duty on certain goods, provided they met specific criteria. TCOs apply to goods for which an application has been approved by the CEO, resulting in a prescribed reduction in customs duty as specified in the Customs Tariff Act 1995. The objective of the Act, as outlined in section 269C, is to ensure that a TCO application is considered only if no substitutable goods are produced in Australia in the ordinary course of business. In the case of Maxwell International Australia's application for a TCO on certain tripods or monopods, the CEO determined that no substitutable goods were produced in Australia, and thus approved the application, resulting in a free rate of duty on these goods.
Scope and Application
The Customs Act 1901, as modified by the Tariff Concession Instrument No. 1031199, applies to goods specifically identified in applications for Tariff Concession Orders (TCOs) and pertains to the rates of customs duty applied to those goods. The Act allows the Chief Executive Officer of Customs to establish a lower rate of customs duty for goods that meet the core criteria outlined in the Act, provided they are not specified as ineligible in section 269SJ. The TCO in question pertains to certain tripods or monopods, for which Maxwell International Australia applied, and the CEO determined that these goods qualify for a tariff concession as no substitutable goods were produced in Australia. This instrument operates under the Commonwealth jurisdiction, impacting importers of the specified goods by potentially entitling them to a refund of duty paid on imports since the effective date of the TCO. The Act does not disadvantage or impose liabilities on any person for actions taken before the TCO's registration date, and the TCO itself does not impose any liabilities.
Key Provisions
The primary operative sections of Tariff Concession Instrument No. 1031199, under the Customs Act 1901, focus on the establishment and application of Tariff Concession Orders (TCOs). Specifically, section 269F allows individuals to apply to the Chief Executive Officer (CEO) of Customs for a TCO concerning particular goods. If the CEO determines that the application pertains to goods not specified in section 269SJ, they must evaluate whether the application meets the core criteria outlined in section 269C. This section stipulates that an application meets the core criteria if, on the date it was lodged, no substitutable goods were being produced in Australia in the ordinary course of business. Additionally, section 269P(3) mandates that if the CEO finds the application meets the criteria, they must issue a written TCO order.
The obligations and requirements imposed by the Act on the parties and entities it governs are primarily centred around the application and approval process for TCOs. The CEO of Customs has a duty to assess whether an application for a TCO meets the specified criteria, as outlined in section 269C. This assessment includes verifying that no substitutable goods are produced in Australia on the date of the application. Furthermore, under subsection 269K(1), 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 granted. In this instance, Maxwell International Australia applied for a TCO on 8 July 2010, and the CEO issued TCO No. 1031199 on 6 October 2010, declaring that the specified tripods or monopods would be subject to the TCO.
For breaches of the provisions outlined in the Customs Act 1901, various offences and penalties may apply. Although the explanatory statement does not detail specific penalties, general provisions under the Customs Act and associated regulations could include fines and imprisonment for serious breaches. Additionally, there may be civil consequences for non-compliance, such as financial penalties or the revocation of import rights. The Act ensures that the rights of individuals other than the Commonwealth are not adversely affected by the issuance of a TCO, and it does not impose any liabilities on these individuals for actions taken before the TCO's registration date. Importers, however, stand to benefit from the TCO, as they can apply for refunds of duty on goods imported since the TCO's effective date.