EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1109614
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.
Aussie Table Tennis Pty Ltd applied for a TCO in respect of certain table tennis tables on 18 March 2011.
Instrument
TCO No 1109614 was made on 06 June 2011. It declares that those certain table tennis tables 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. 1109614 is taken to have come into force on 18 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 the application and administration of customs duties, including the process for Tariff Concession Orders (TCOs). The Act was introduced to address the need for a streamlined process to allow for tariff concessions on specific goods, thereby supporting industries that may be at a disadvantage due to the absence of local production of substitutable goods. Under the Customs Act, the Chief Executive Officer of Customs has the authority to make TCOs which apply reduced rates of customs duty on specified goods if certain criteria are met, such as the absence of substitutable goods produced in Australia. This process was designed to encourage the importation of goods that are not locally manufactured, thus potentially lowering costs and increasing the availability of certain products in the Australian market. Tariff Concession Instrument No. 1109614, made under the authority of the Customs Act, specifically addresses an application by Aussie Table Tennis Pty Ltd for tariff concessions on certain table tennis tables, reflecting the policy objective of supporting niche markets and industries.
Scope and Application
The Customs Act 1901, as supplemented by the Tariff Concession Instrument No. 1109614, applies to any person or entity seeking to import specified goods into Australia and avail themselves of tariff concessions. The scope of this legislation pertains to the process of applying for Tariff Concession Orders (TCOs) through the Chief Executive Officer of Customs, who assesses whether the application meets the core criteria outlined in the Act. Specifically, this includes ensuring that no substitutable goods, meaning those produced in Australia and serving a similar purpose to the imported goods, are produced domestically. The geographic reach of this legislation is national, as it applies across all states and territories of Australia, governed by the Commonwealth. The Act does not specify any exclusions or exemptions beyond those mentioned in section 269SJ of the Customs Act 1901, which lists goods that cannot be subject to a TCO. The application and effect of the TCO are further extended and defined through subordinate instruments, such as the Customs Tariff Act 1995, which specifies the rates of duty.
Key Provisions
The Customs Act 1901 provides a framework for Tariff Concession Orders (TCOs) through Part XVA, which allows the Chief Executive Officer of Customs (CEO) to apply lower rates of customs duty on specified goods (section 269F). For an application to be valid, it must not concern goods listed in section 269SJ of the Act and must meet the core criteria specified in section 269C. Specifically, a TCO application meets these criteria if, on the date the application is lodged, no substitutable goods are produced in Australia in the ordinary course of business (section 269C). The definitions of 'goods produced in Australia', 'ordinary course of business', and'substitutable goods' are detailed in sections 269D, 269E, and 269P(3) respectively.
The Act imposes specific obligations on applicants and the CEO. An applicant must submit an application that complies with the statutory criteria, and the CEO must ensure that the application does not pertain to restricted goods (section 269SJ). If the CEO is satisfied that the application meets the core criteria, they are mandated to make a written TCO (section 269P(3)). Additionally, the CEO is required to publish a notice in the Gazette, inviting any interested parties to submit reasons why the TCO should not be granted (subsection 269K(1)).
In the case of TCO No. 1109614, the CEO accepted the application from Aussie Table Tennis Pty Ltd on 6 June 2011 and determined that the table tennis tables in question were subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, resulting in a duty rate of free, down from the general rate of 5%. The TCO came into force on the date the application was lodged, 18 March 2011, without affecting existing rights or imposing liabilities on anyone except the Commonwealth (subsection 269S(1)). Importers of these goods can apply for a refund of duty on goods imported since the TCO's effective date under paragraph 126(1)(r) of the Regulations.
There are no specific offences, penalties, or civil/criminal consequences outlined for breaches of this TCO within the provided text. However, general compliance with customs laws and TCOs is expected, and failure to adhere to the stipulated conditions could result in penalties as outlined in the broader Customs Act 1901 and associated regulations.