EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1049261
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.
Queensland Art Gallery applied for a TCO in respect of certain stainless steel playground tube slides with a polycarbonate cover on 05 November 2010.
Instrument
TCO No 1049261 was made on 24 January 2011. It declares that those certain stainless steel playground tube slides with a polycarbonate cover 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. 1049261 is taken to have come into force on 05 November 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, facilitates the application of tariff concessions on certain goods through the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This legislation addresses the need for reducing the customs duty on specific goods that are not produced in Australia, thereby supporting economic activities and potentially aiding in the availability of non-domestically produced items in the market. The Act was introduced to streamline the process of applying for reduced duty rates on goods that meet specified criteria, such as the absence of substitutable Australian-made alternatives. The objective is to ensure that the process for granting tariff concessions is both efficient and transparent, allowing for economic benefits to be realised without unduly burdening the Commonwealth or other stakeholders. The introduction of Tariff Concession Instrument No. 1049261 under this Act exemplifies the application of these principles, as demonstrated in the case of the Queensland Art Gallery’s application for reduced duty on stainless steel playground tube slides with a polycarbonate cover.
Scope and Application
The Customs Act 1901, as amended, includes a framework under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (CEO). The Act applies to any person or entity seeking a tariff concession for specific goods, provided these goods are not listed in section 269SJ, which includes certain goods that cannot be subject to a TCO. The CEO must assess whether the application for a TCO meets the core criteria, specifically whether no substitutable goods are produced in Australia, as outlined in sections 269C and 269D of the Act. If the application meets the criteria, the CEO must make a written order that declares the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies. The geographic reach of this Act is national, applying to all goods entering Australia, and the concessions granted through TCOs are subject to the regulations and orders made under the Customs Act. The TCOs do not affect existing rights or impose liabilities on persons other than the Commonwealth for actions taken prior to the order's registration.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 1049261 under the Customs Act 1901 (the Act) pertain to the establishment of Tariff Concession Orders (TCOs) (section 269F). This instrument, which was made on 24 January 2011, applies to certain stainless steel playground tube slides with a polycarbonate cover, declaring that these goods are subject to a TCO (section 269P(3)). This means that these specific goods now have a lower rate of customs duty applied, in this case, free of charge, as opposed to the general rate of 5% (Schedule 4, item 50, Customs Tariff Act 1995). The CEO of Customs must make a written order when satisfied that the application meets the core criteria, which include verifying that no substitutable goods were produced in Australia on the day the application was lodged (sections 269C and 269P(3)).
The Act imposes specific obligations on the parties involved, particularly the CEO of Customs, who is responsible for evaluating TCO applications to ensure they meet the core criteria (section 269C). The CEO must also publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made, and consider these submissions before making a decision (subsection 269K(1)). The CEO must also ensure that the TCO does not adversely affect the rights of any person, other than the Commonwealth, as at the date of registration (subsection 269S(1)).
There are no explicit offences, penalties, or civil/criminal consequences stated for breach of the TCO in the provided text. However, the instrument does mention that the rights of importers will be beneficially affected and that they can apply for a refund of duty on goods imported since the TCO came into force (paragraph 126(1)(r) of the Regulations). The TCO does not impose any liabilities on any person, reinforcing the non-adversarial nature of the instrument as it pertains to existing rights and obligations.