EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1051913
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.
Clark Equipment Sales Pty Ltd applied for a TCO in respect of certain light towers on 25 November 2010.
Instrument
TCO No 1051913 was made on 28 February 2011. It declares that those certain light towers 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. 1051913 is taken to have come into force on 25 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 Tariff Concession Instrument No. 1051913 was enacted in 2011 under the Customs Act 1901 to address the issue of providing tariff concessions for certain goods imported into Australia. This legislation enables the Chief Executive Officer of Customs to grant tariff concessions through Tariff Concession Orders (TCOs) when specific criteria are met, thereby reducing the customs duty payable on particular imported goods. The primary objective of this instrument, as stated in the explanatory statement, is to facilitate the importation of goods by applying a reduced rate of customs duty or, in some cases, a duty-free rate, provided that no substitutable goods are produced in Australia. This mechanism is designed to support the import of goods that are not locally manufactured, thereby benefiting importers and potentially stimulating competition and consumer choice in the domestic market. The instrument was introduced by the Commonwealth Parliament and aims to streamline the process of applying for and granting tariff concessions, ensuring that the rights of all parties, particularly importers, are protected and not adversely affected by the concessions granted.
Scope and Application
The Tariff Concession Instrument No. 1051913 under the Customs Act 1901 applies specifically to Clark Equipment Sales Pty Ltd's application for tariff concessions on certain light towers. This instrument facilitates the application of a lower rate of customs duty on these goods, provided they meet the core criteria outlined in the Act. The instrument’s geographic reach is national, as it pertains to the federal application of customs duties across Australia. The application of this instrument is contingent on the condition that no substitutable goods are produced in Australia, as defined under sections 269D and 269E of the Act. The instrument does not affect any pre-existing rights or impose liabilities on individuals or entities except for the Commonwealth. Additionally, the instrument extends its application through the subsidiary Customs Tariff Act 1995, which outlines the specific tariff rates for the goods in question.
Key Provisions
The Customs Act 1901, specifically under Part XVA, outlines the framework for Tariff Concession Orders (TCOs) which can be issued by the Chief Executive Officer of Customs (CEO) (s 269F). When an application is made under section 269F, the CEO must assess whether it meets the core criteria, which include the absence of substitutable goods produced in Australia at the time the application was lodged (s 269C). If the application satisfies these criteria, the CEO is required to issue a written TCO, specifying the goods to which a prescribed tariff item in Schedule 4 of the Customs Tariff Act 1995 applies (s 269P(3)).
The obligations under this Act require applicants to ensure that their applications meet the specified criteria, particularly that no substitutable goods are being produced in Australia at the time of application. The CEO, in turn, is obligated to publish a notice in the Gazette inviting submissions from any interested parties and to make a decision based on the merits of the application and any received submissions (s 269K(1)). The CEO must also ensure that the TCO does not disadvantage any person, except the Commonwealth, or impose liabilities on them in respect of actions taken before the TCO registration date (s 269S(1)).
In terms of consequences, breaches of the requirements or obligations outlined in the Customs Act 1901 can lead to penalties. While the explanatory statement does not detail specific offences or penalties, the general legal framework implies that non-compliance with the Act could result in civil or criminal sanctions. Penalties can vary depending on the nature and severity of the breach but may include fines or other legal repercussions as prescribed by the relevant statutes. The Act ensures that the rights of importers are protected and can benefit from duty refunds for goods imported since the TCO came into force, without any imposition of new liabilities.