EXPLANATORY STATEMENT
Customs By-law No. 1700051
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 Comptroller-General 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
Item 38 in Schedule 4 of the Customs Tariff Act references a number of tariff subheadings, including 8703.22.20, 8703.23.20, 8703.24.20, 8703.31.20, 8703.32.20, 8703.33.20 and 8703.90.20, and 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”.
The Customs Tariff Amendment (2017 Harmonized System Changes) Act 2016 commenced on 1 January 2017 and amended the Customs Tariff Act 1995 including inserting new tariff subheadings 8703.40.20, 8703.50.20, 8703.60.20, 8703.70.20 and 8703.80.20. The new tariff subheadings resulted in the reclassification of a subset of the goods previously classified to tariff subheadings 8703.22.20, 8703.23.20, 8703.24.20, 8703.31.20, 8703.32.20, 8703.33.20 and 8703.90.20.
By-law No. 1700051 replaces previous By-law No. 1300584, updating the references to relevant tariff subheadings.
Instrument
By-law No. 1700051 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 Department of Immigration and Border Protection to ensure compliance with the conditions set out in the by-law.
Consultation
No consultation was undertaken in relation to By-law No. 1700051 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. 1700051 takes effect on and from 1 January 2017.
Overview
The Customs By-law No. 1700051, enacted in 2017, amends the Customs Act 1901 to update the tariff classifications for vehicle components used as original equipment in the assembly or manufacture of motor vehicles. This by-law was necessitated by changes introduced by the Customs Tariff Amendment (2017 Harmonized System Changes) Act 2016, which reclassified certain vehicle components under new tariff subheadings. The by-law, made by the Comptroller-General of Customs under the authority granted in Section 271 of the Customs Act 1901, aims to ensure that the duty-free status of specified vehicle components is maintained by aligning the relevant tariff subheadings. The by-law does not affect existing arrangements and does not engage any human rights issues, as confirmed in the explanatory statement. It came into effect on 1 January 2017, in line with the commencement of the amending Customs Tariff Act.
Scope and Application
The Customs By-law No. 1700051 under the Customs Act 1901 applies to specific vehicle components used as original equipment in the manufacture or assembly of motor vehicles with a gross vehicle weight greater than 3.5 tonnes and those between 3.5 tonnes and 4 tonnes, classified under particular headings or subheadings listed in the by-law. This by-law ensures that certain components are dutiable at the rate of "Free" as per the amended Customs Tariff Act 1995. It operates within the Commonwealth jurisdiction and does not impose any new obligations or restrictions beyond updating the references to relevant tariff subheadings in response to the changes introduced by the Customs Tariff Amendment (2017 Harmonized System Changes) Act 2016. Compliance with the by-law requires a security to be lodged with the Department of Immigration and Border Protection. Notably, this by-law does not engage or impact human rights as defined under the Human Rights (Parliamentary Scrutiny) Act 2011, and it came into effect on 1 January 2017.
Key Provisions
The Customs By-law No. 1700051, pursuant to Section 271 of the Customs Act 1901, specifies the vehicle components eligible for duty-free status when used as original equipment in the manufacture or assembly of certain motor vehicles. According to Section 271, the Comptroller-General of Customs can create by-laws to prescribe goods subject to the Customs Tariff, which is defined in Section 4 of the Act. This by-law, No. 1700051, replaces the previous By-law No. 1300584 and updates the references to relevant tariff subheadings. Specifically, it applies to components used in vehicles with a gross vehicle weight over 3.5 tonnes and those classified under specified headings or subheadings listed in Table 1 and Table 2 of the by-law.
The by-law imposes several obligations on the parties involved. Firstly, it mandates that a security must be lodged with the Department of Immigration and Border Protection to ensure compliance with the conditions set out in the by-law. This security serves as a guarantee that the components are used strictly for the purposes and conditions outlined in the by-law. Secondly, the by-law requires that the vehicle components must be used as original equipment in the assembly or manufacture of the cab/chassis or drivable chassis of motor vehicles meeting the specified gross vehicle weight criteria. Any deviation from these requirements would necessitate the application of relevant duties.
Failure to comply with the provisions of this by-law may result in significant consequences. Although the explanatory statement does not detail specific penalties, breaches of customs by-laws can generally lead to civil or criminal sanctions. Under the Customs Act 1901, civil penalties may include financial penalties and the seizure of goods. Criminal penalties can range from fines to imprisonment, depending on the severity and intent of the breach. The exact penalties would be determined based on the specific circumstances of the non-compliance and any applicable provisions within the Customs Act.