EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1109276
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.
Croftminster applied for a TCO in respect of certain board games on 17 March 2011.
Instrument
TCO No 1109276 was made on 06 June 2011. It declares that those certain board games 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. 1109276 is taken to have come into force on 17 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 Tariff Concession Instrument No. 1109276, enacted in 2011, amends the Customs Act 1901 by establishing a specific framework for tariff concessions. This legislative instrument was introduced to address the need for more flexible tariff arrangements that could cater to unique circumstances, such as when goods are not produced domestically or when their importation can stimulate economic benefits. The instrument is enacted by the Parliament of Australia and aims to provide a mechanism for reducing or eliminating customs duty on certain imported goods, thereby promoting fair trade practices and potentially encouraging local industries to innovate or expand their product offerings. This approach aligns with the overarching policy objectives of the Customs Act, which seeks to facilitate international trade while also protecting Australian industries where necessary.
Scope and Application
The Customs Act 1901, as amended by Tariff Concession Instrument No. 1109276, applies to entities and individuals involved in the importation of certain board games into Australia. The Act facilitates the application process for Tariff Concession Orders (TCOs), enabling a lower rate of customs duty for specified goods. This legislation is applicable to any entity or individual seeking to import the particular board games identified in the TCO, thereby providing tariff relief for these goods under the conditions stipulated in the Act. The geographic scope of this Act is national, as it pertains to the importation into Australia and the application of tariff concessions at a Commonwealth level. The Act does not apply to goods specified in section 269SJ, which are excluded from TCOs. The commencement of the TCO is retroactive to the date the application was lodged, which in this case is 17 March 2011, ensuring that any duties paid on the specified goods from that date forward are eligible for refund. The application of the TCO does not disadvantage any person other than the Commonwealth and does not impose any liabilities on such persons for actions taken prior to the TCO's effective date.
Key Provisions
The main operative sections of this legislation involve the creation of Tariff Concession Orders (TCOs) under Part XVA of the Customs Act 1901. Section 269F of the Act allows an application to be made to the Chief Executive Officer of Customs (CEO) for a TCO in respect of specific goods. Section 269C specifies the core criteria that an application must meet, which includes the condition that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Once the CEO is satisfied that the application meets these criteria, a TCO must be issued under section 269P(3), declaring the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies.
The Act imposes several obligations and requirements on the parties involved. Firstly, the CEO is obligated to decide whether an application meets the core criteria set out in section 269C. This involves verifying that no substitutable goods were produced in Australia on the day the application was made. Furthermore, the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made, as per subsection 269K(1). This ensures transparency and allows for potential objections to be raised. The Act also requires that a TCO is deemed to have come into force on the day the application was lodged, as stated in subsection 269S(1).
The Act outlines specific consequences for non-compliance with its provisions. While the explanatory statement does not detail specific offences or penalties, the general legal framework under the Customs Act 1901 provides for potential civil and criminal penalties for breaches. These could include fines, imprisonment, or other penalties as determined by the courts. The exact nature and severity of these penalties would depend on the specific circumstances and the discretion of the court. However, the explanatory statement does clarify that the TCO does not affect the rights of any person as at the date of registration, nor does it impose any new liabilities on any person, thereby ensuring that existing rights and obligations are preserved.
In summary, the legislation under discussion provides a clear framework for the creation of Tariff Concession Orders through the Customs Act 1901. It specifies the process for applying for and issuing a TCO, the obligations of the CEO in handling these applications, and the commencement date for the TCO. While the explanatory statement does not explicitly detail the penalties for non-compliance, the broader legal framework suggests that there are potential civil and criminal consequences for breaches. The TCO is designed to benefit importers by potentially allowing for refunds of duty, without imposing any new liabilities or disadvantaging any person.