EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1109094
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.
Phoenix Outdoor Pty Ltd applied for a TCO in respect of certain scrolling poster display boards on 15 March 2011.
Instrument
TCO No 1109094 was made on 06 June 2011. It declares that those certain scrolling poster display boards 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. 1109094 is taken to have come into force on 15 March 2011.
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, establishes a framework for administering customs duties and includes provisions for Tariff Concession Orders (TCOs) under Part XVA. These orders allow for a lower rate of customs duty on specified goods, provided certain criteria are met, such as the absence of substitutable goods produced in Australia. The objective of this legislative instrument is to support Australian industries by reducing the cost of importing necessary goods that are not produced domestically. Instrument TCO No. 1109094, issued on 6 June 2011, pertains to certain scrolling poster display boards, reducing the general duty rate of 5% to free duty, effective from 15 March 2011, the date the application was lodged. This tariff concession aims to benefit importers by potentially allowing them to claim refunds for duties paid on these goods imported since the effective date.
Scope and Application
The Customs Act 1901, through its Part XVA, facilitates the application of Tariff Concession Orders (TCOs) which lower the rate of customs duty on specified goods. The Act applies to individuals and entities that seek a tariff concession for goods that are not produced in Australia in the ordinary course of business and for which there are no substitutable goods. The application process requires submission to the Chief Executive Officer of Customs, who must satisfy themselves that the application meets the core criteria set out in the Act, including the absence of substitutable Australian-produced goods. Once approved, the TCO applies retroactively to the date of application, benefiting importers by potentially allowing them to claim refunds on duties paid prior to the order's effective date. This legislation has a Commonwealth jurisdictional reach and does not disadvantage any person by imposing liabilities for actions taken prior to the TCO's registration. The Act may also extend its application through subordinate instruments, although the specifics of these extensions are not detailed in the provided explanatory statement.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 1109094, under the Customs Act 1901, establish the framework through which Tariff Concession Orders (TCO) can be issued by the Chief Executive Officer of Customs (CEO) (ss 269C, 269F, 269P). Specifically, section 269F allows for applications to be made to the CEO for a TCO concerning particular goods. If the CEO is satisfied that the application pertains to goods not excluded under section 269SJ and meets the core criteria specified in section 269C, the CEO must issue a TCO (s 269P(3)). Section 269C stipulates that the core criteria are met if, on the date of application, no substitutable goods were produced in Australia in the ordinary course of business. Furthermore, section 269B defines the terms 'goods produced in Australia', 'ordinary course of business', and'substitutable goods', which are crucial for determining the eligibility of goods for a TCO.
The Act imposes certain obligations and requirements on the parties involved. An applicant must submit a valid application to the CEO for a TCO (s 269F). The CEO has the duty to review the application, ensuring it complies with the criteria set out in section 269C, and subsequently decide whether to issue a TCO (s 269P(3)). If the CEO is satisfied that the application meets the criteria, a written order (TCO) must be issued (s 269P(3)). Additionally, the CEO must publish a notice in the Gazette, inviting any interested parties to submit submissions if they believe the TCO should not proceed (s 269K(1)). This ensures transparency and allows for any potential objections to be considered before a TCO is made.
The Act also delineates consequences for non-compliance and breaches. While specific offences, penalties, or civil/criminal consequences for breaches of the TCO are not explicitly stated in the provided text, the general framework of the Customs Act 1901 may impose penalties for non-compliance. These could include fines or other civil penalties as prescribed under relevant sections of the Act or related legislation. For instance, section 126(1)(r) of the Regulations allows importers to apply for a refund of duty on goods imported since the TCO is taken to have come into force, suggesting that any failure to adhere to the TCO requirements might result in disputes over duty refunds. Therefore, while the text does not detail specific penalties, the overarching legal framework implies that breaches could lead to financial repercussions or legal actions under the Customs Act or associated regulations.