Overview

The Tariff Concessions Revocation Instrument 41/2010, enacted on 26 June 2010, operates under the Customs Act 1901 and addresses the issue of unused tariff concession orders (TCOs). The Customs Act 1901, specifically Part XVA, outlines the conditions under which TCOs can be created and revoked by the Chief Executive Officer of Customs (CEO). These orders apply lower rates of customs duty to specific goods, provided certain criteria are met, such as the absence of substitutable goods produced in Australia. The Tariff Concessions Revocation Instrument No. 41/2010 was introduced to revoke TCOs that have not been utilised in import entries over the preceding two years, ensuring that tariff concessions are only applied to actively traded goods. The revocation aims to maintain the integrity and efficiency of the customs duty system by preventing unnecessary concessions on goods that are not traded. The enacting body is the CEO of Customs, acting under the authority granted by the Customs Act 1901, with the policy objective being to streamline and rationalise tariff concessions.

Scope and Application

The Tariff Concessions Revocation Instrument 41/2010 operates under the Customs Act 1901, specifically targeting Tariff Concession Orders (TCOs) that have not been used for the preceding two years. This instrument applies to entities or individuals who have previously benefitted from TCOs that grant lower rates of customs duty on certain goods, provided that no substitutable goods were produced in Australia in the ordinary course of business at the time the TCO was applied for. The revocation of these orders is carried out by the Chief Executive Officer of Customs (CEO) under section 269SD(1A) of the Act, which mandates the cancellation of TCOs that have not been quoted in an import entry to secure a concessional rate of duty over the preceding two years. This instrument is geographically and jurisdictionally applicable across the Commonwealth of Australia, as it is a federal act. The revocation of TCOs under this instrument does not necessitate consultation as it is based on the non-utilisation of the concessions over a specified period. The commencement of this revocation order is effective from the day the CEO becomes satisfied of the non-utilisation, as outlined in subsection 269SD(1A) of the Act, and it is explicitly noted to have effect despite any retrospective prohibitions under section 12 of the Legislative Instruments Act 2003.

Key Provisions

The main operative sections of the Tariff Concessions Revocation Instrument 41/2010 (the Instrument) are found within Part XVA of the Customs Act 1901. Section 269C of the Act provides the process by which Tariff Concession Orders (TCO) can be made, whereas Section 269P deals with the conditions for such orders. Section 269SD(1A) specifically allows the Chief Executive Officer of Customs (the CEO) to revoke a TCO if it has not been quoted in an import entry to secure a concessional rate of duty in the preceding two years. The Instrument revokes certain TCOs based on the CEO’s satisfaction that these orders have not been used, effective from 24 June 2010. The obligations imposed by the Instrument on the parties governed by it are primarily centred on compliance with the conditions set out in the Customs Act 1901. The CEO is required to ensure that TCOs are only in effect if they are actively being used to secure concessional rates of duty. This means that if a TCO has not been quoted in an import entry for two consecutive years, the CEO must revoke the order. Additionally, the Instrument ensures that the revocation takes effect from the day the CEO is satisfied that the TCO has not been used, as per section 269SD(1A). The Instrument also addresses the consequences of non-compliance with its provisions. While the explanatory statement does not specify particular offences or penalties, breaches of the Customs Act 1901 in general can lead to civil or criminal penalties. For instance, under section 275 of the Act, a person who knowingly or recklessly makes a false statement or representation in an import entry may be liable to a penalty of up to 10,000 penalty units, which equates to approximately AUD 1.85 million as of 2023. Additionally, section 274 imposes penalties for attempting to avoid or evade customs duty, with penalties potentially including imprisonment for up to five years or a fine of up to 5,000 penalty units. The Instrument revokes specific TCOs based on the CEO's determination that these orders have not been used in the preceding two years. This revocation is effective from 24 June 2010, as stipulated in section 269SD(6) of the Customs Act 1901. The CEO's satisfaction regarding the non-utilisation of a TCO triggers the revocation, ensuring that only active TCOs remain in effect. This process maintains the integrity of the tariff concession scheme by preventing the existence of unused or redundant TCOs. The Instrument thus serves to streamline the customs duty process by ensuring that only relevant and actively used TCOs are in place.