EXPLANATORY STATEMENT
Customs By-law No. 1301117
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 39 in new Schedule 4 combines items 41G and 41H of the previous Schedule 4 to the Customs Tariff Act. Item 39 provides that goods, as prescribed by by-law, that are for use in the testing, quality control, manufacturing evaluation, or engineering development of motor vehicles that are manufactured in Australia or that are being designed or engineered in Australia, are dutiable at the rate of “Free”.
By-law No. 1301117 replaces previous By-laws No. 0040030, 0040031, 0040032, 0040033, 0040034 and 0900069.
Instrument
By-law No. 1301117 prescribes, for the purposes of item 39, vehicles and components for use in the testing, quality control, manufacturing evaluation or engineering development of:
a) motor vehicles manufactured by producers registered under the Automotive Transformation Scheme (within the meaning of the Automotive Transformation Scheme Act 2009); or
b) original equipment components for inclusion in such motor vehicles.
By-law No. 1301117 also prescribes, for the purposes of item 39, vehicles and components for use in the testing, quality control, manufacturing evaluation or engineering development of:
a) motor vehicles designed or engineered or in the process of being designed or engineered in Australia by motor vehicle producers registered under the Automotive Transformation Scheme; or
b) components for inclusion in such motor vehicles.
The goods are to be re-exported, destroyed, or, disposed of in a manner approved in writing by the Collector, within a period of 12 months from the date of entry for home consumption, or within such further period as the Collector may allow.
A security must be lodged with the Australian Customs and Border Protection Service to ensure compliance.
Consultation
No consultation was undertaken in relation to By-law No. 1301117 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. 1301117 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. 1301117, which was enacted in 2013, was introduced as part of the Customs Tariff Amendment (Schedule 4) Act 2012. This Act aimed to modernise the Australian Customs Tariff, specifically addressing the need for updated by-laws in light of the new Schedule 4 of the Customs Tariff Act. By-law No. 1301117 was necessitated to provide specific regulations under item 39 of the new Customs Tariff, which deals with goods used in the testing, quality control, manufacturing evaluation, or engineering development of motor vehicles that are manufactured or being designed in Australia. This by-law was formulated to align with the policy objectives of supporting the local automotive industry, particularly under the Automotive Transformation Scheme, and ensuring that goods intended for developmental purposes within Australia are appropriately managed under customs regulations. The by-law was enacted by the Australian Customs and Border Protection Service, aiming to maintain the integrity of customs duties while facilitating necessary industrial activities.
Scope and Application
The Customs By-law No. 1301117 applies to goods specifically designated under the Customs Tariff Amendment (Schedule 4) Act 2012, which was enacted to update and streamline the duties on various imported items. This by-law targets goods used for the testing, quality control, manufacturing evaluation, or engineering development of motor vehicles that are either manufactured or designed in Australia. These goods must be related to motor vehicles produced by entities registered under the Automotive Transformation Scheme, as defined by the Automotive Transformation Scheme Act 2009. The by-law prescribes that such goods, which include vehicles and components, are dutiable at the rate of "Free" under the specified conditions, provided they are re-exported, destroyed, or otherwise disposed of in a manner approved by the Collector within 12 months of entry for home consumption. This by-law ensures compliance through the requirement of lodging a security with the Australian Customs and Border Protection Service. The by-law does not apply to any other goods outside the specified scope and does not affect human rights as defined in the Human Rights (Parliamentary Scrutiny) Act 2011. The by-law is set to take effect from 1 March 2013, aligning with the commencement date of the Customs Tariff Amendment (Schedule 4) Act 2012.
Key Provisions
The main operative sections of Customs By-law No. 1301117 (section 271 of the Customs Act 1901) pertain to the exemption of certain goods from customs duty. Specifically, it applies to goods used in the testing, quality control, manufacturing evaluation, or engineering development of motor vehicles manufactured in Australia or being designed or engineered in Australia. These goods are to be prescribed by by-law and are exempt from duty under item 39 of the new Schedule 4 of the Customs Tariff Act 1995. The by-law replaces previous by-laws and outlines the specific types of vehicles and components eligible for this exemption, namely those associated with motor vehicles manufactured by producers registered under the Automotive Transformation Scheme or those being designed or engineered in Australia.
The obligations imposed by Customs By-law No. 1301117 primarily involve the registration of motor vehicle producers under the Automotive Transformation Scheme and the adherence to specific disposal or re-export requirements for the exempted goods. These goods must be either re-exported, destroyed, or disposed of in a manner approved by the Collector within 12 months from the date of entry for home consumption. Additionally, a security must be lodged with the Australian Customs and Border Protection Service to ensure compliance with these requirements. These obligations ensure that the benefits of the exemption are limited to their intended use and that the goods do not enter the domestic market, thus maintaining the integrity of the exemption.
Failure to comply with the provisions of Customs By-law No. 1301117 can lead to various consequences. The Act does not specify particular offences or penalties in the explanatory statement, but breaches of customs regulations generally can result in civil or criminal penalties. Civil penalties may include financial penalties, and in severe cases, criminal penalties could be imposed, which may include fines and imprisonment. The exact penalties would depend on the nature and severity of the breach, as outlined in the relevant sections of the Customs Act 1901 and other applicable legislation. Compliance with the by-law is therefore crucial to avoid these potential consequences.