EXPLANATORY STATEMENT
Customs By-law No. 1300584
Customs Act 1901
Section 271 of the Customs Act 1901 (the Act) provides, in part, that where an item of a Customs Tariff is expressed to apply to goods, or to a class or kind of goods, as prescribed by by-law, the Chief Executive Officer of Customs may make by-laws for the purposes of that item. A Customs Tariff is defined in section 4 of the Act to mean an act imposing duties of customs. The Customs Tariff Act 1995 (the Customs Tariff Act) is a Customs Tariff for the purposes of the Act.
Background
The Customs Tariff Amendment (Schedule 4) Act 2012 will commence on 1 March 2013. It will repeal the existing Schedule 4 of the Customs Tariff Act and replace it with a new Schedule 4. As part of this process, new by-laws are required for all items that provide for goods to be prescribed by by-law.
Item 38 in new Schedule 4 replaces item 41F of the previous Schedule 4 to the Customs Tariff Act. Item 38 provides that goods, as prescribed by by-law, which are components for use as original equipment in the assembly or manufacture of vehicles over 3.5 tonnes, are dutiable at the rate of “Free”.
By-law No. 1300584 replaces previous By-law No. 0040029.
Instrument
By-law No. 1300584 prescribes vehicle components for use as original equipment in the manufacture or assembly of the cab/chassis or drivable chassis of motor vehicles which:
a) have a gross vehicle weight greater than 3.5 tonnes; and
b) are classified under a heading or subheading listed in Table 1.
The by-law also prescribes vehicle components for use as original equipment in the assembly of motor vehicles which:
a) have a gross vehicle weight between 3.5 tonnes and 4 tonnes; and
b) are classified under a heading or subheading listed in Table 2.
A security must be lodged with the Australian Customs and Border Protection Service to ensure compliance with the conditions.
Consultation
No consultation was undertaken in relation to By-law No. 1300584 as it does not alter existing arrangements.
Human Rights Implications
This by-law does not engage, impact on, or limit in any way, the human rights and freedoms recognised or declared in the international instruments listed in the definition of human rights at section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Commencement
By-law No. 1300584 takes effect on and from the date that the Customs Tariff Amendment (Schedule 4) Act 2012 commences, that is 1 March 2013.
Overview
The Customs By-law No. 1300584, introduced under the Customs Act 1901, was enacted to address the need for updated regulatory frameworks in response to amendments in the Customs Tariff. This by-law was developed following the Customs Tariff Amendment (Schedule 4) Act 2012, which aimed to modernise the tariff structure by replacing the existing Schedule 4 with a new one. Specifically, By-law No. 1300584 was necessary to prescribe new categories of goods subject to specific customs duties, particularly focusing on vehicle components used in the assembly or manufacture of heavy vehicles. The by-law, which came into effect on 1 March 2013, ensures compliance with the new tariff provisions by detailing the components eligible for duty-free treatment and requiring security to be lodged with the Australian Customs and Border Protection Service. The enactment of this by-law was conducted by the relevant legislature, reflecting a policy objective to streamline customs procedures in line with updated legislative requirements.
Scope and Application
The Customs By-law No. 1300584 applies to entities involved in the importation of vehicle components that are intended for use as original equipment in the assembly or manufacture of motor vehicles with a gross vehicle weight over 3.5 tonnes. This includes manufacturers, importers, and any other parties who need to comply with the Customs Tariff as prescribed by the Customs Act 1901. The by-law specifically pertains to components classified under headings or subheadings listed in Tables 1 and 2, which cover various types of motor vehicles. It operates within the national jurisdiction of Australia, as it is a subordinate instrument of the Customs Act 1901, which is a Commonwealth Act. There are no stated exclusions or exemptions in this by-law, and compliance is mandatory for all relevant entities. The by-law is effective from 1 March 2013, the commencement date of the Customs Tariff Amendment (Schedule 4) Act 2012, and requires a security to be lodged with the Australian Customs and Border Protection Service to ensure adherence to the stipulated conditions.
Key Provisions
The Customs By-law No. 1300584, made under section 271 of the Customs Act 1901, sets forth the conditions for the duty-free treatment of specific vehicle components. These components are prescribed to be used as original equipment in the assembly or manufacture of vehicles that exceed 3.5 tonnes in gross vehicle weight, as detailed in Table 1 and Table 2 of the by-law. For vehicles classified under headings or subheadings listed in Table 1, components used in the cab/chassis or drivable chassis of vehicles weighing more than 3.5 tonnes are exempt from duty. Similarly, components used in the assembly of vehicles weighing between 3.5 and 4 tonnes, classified under the headings or subheadings in Table 2, are also exempt. The by-law specifies that a security must be lodged with the Australian Customs and Border Protection Service to ensure compliance with these conditions.
The obligations imposed by this by-law on parties or entities include ensuring that the vehicle components prescribed as exempt from duty are indeed used as original equipment in the specified types of vehicles. Manufacturers, importers, or any party involved in the assembly or manufacture of these vehicles must adhere to the classifications outlined in Tables 1 and 2 of the by-law. Additionally, the requirement to lodge a security with the Australian Customs and Border Protection Service is a critical compliance measure, ensuring that the duty exemption conditions are met and maintained throughout the importation and assembly process.
Any breach of the provisions set out in By-law No. 1300584 can lead to civil and criminal consequences. Under the Customs Act 1901, failure to comply with the duty exemption conditions, including the improper use of vehicle components or the omission to lodge the required security, can result in significant penalties. The maximum penalties for contravening the Act include fines and, in severe cases, imprisonment. The exact penalties may vary based on the specific nature and extent of the breach, but they are designed to enforce compliance and uphold the regulatory framework governing the importation and use of vehicle components in Australia.