EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0403927
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.
Honeycombes Sales and Services Pty Ltd applied for a TCO in respect of certain billet sugar cane harvesters on 20 April 2004.
Instrument
TCO No 0403927 was made on 26 May 2005. It declares that those certain billet sugar cane harvesters 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. One submission objecting to the TCO application was received from Austoft Industries Ltd.
Commencement
Subsection 269SA(2) (b) relevantly provides that a TCO is to be taken to have come into force on the day on which the local manufacturer ceased production of substitutable goods. Accordingly, TCO No. 0403927 is taken to have come into force on 30 April 2004.
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 was enacted to provide a framework for the regulation of customs duties, and it includes provisions for Tariff Concession Orders (TCOs) that allow for reduced customs duties on certain goods. The Tariff Concession Instrument No. 0403927, made under the authority of the Customs Act 1901, was introduced to facilitate tariff concessions for specific goods, in this case, billet sugar cane harvesters, thereby addressing the gap where local manufacturers had ceased producing substitutable goods. The instrument was created following an application by Honeycombes Sales and Services Pty Ltd, and after consultation with relevant stakeholders, including an objection from Austoft Industries Ltd. The instrument came into force on 30 April 2004, and it provides that the certain billet sugar cane harvesters are subject to a free rate of duty rather than the general rate of 5%, benefiting importers who can apply for duty refunds for goods imported since the effective date of the concession.
Scope and Application
The Customs Act 1901 applies to any person or entity seeking to import goods into Australia, including both individuals and corporations, as well as to the goods themselves. It encompasses a broad range of industries and transactions involving the importation of goods, particularly focusing on the assessment and imposition of customs duties. The Act operates under the Commonwealth jurisdiction and is designed to regulate the importation of goods into Australia, ensuring compliance with customs duties and related regulations. Section 269SJ of the Act excludes certain goods from being subject to Tariff Concession Orders, which are determined by the Chief Executive Officer of Customs. The application of the Customs Act extends through subordinate instruments such as regulations, which may provide further details on the implementation and administration of the Act.
The Act's application is specifically tailored to goods that are subject to Tariff Concession Orders, which are granted when the Chief Executive Officer of Customs is satisfied that no substitutable goods are produced in Australia in the ordinary course of business. This means that the Act primarily applies to imported goods that do not have locally produced equivalents. The geographic reach of the Act is national, as it applies across Australia. There are no explicit exclusions or thresholds mentioned in the provided text, though certain goods are inherently excluded under section 269SJ. The Act ensures that any rights of importers are beneficially affected by the concession orders, and it does not disadvantage or impose liabilities on any person other than the Commonwealth for actions taken prior to the registration of the Tariff Concession Order.
Key Provisions
The main operative sections of this legislation, specifically the Tariff Concession Instrument No. 0403927, establish a framework under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (section 269F). If a person applies for a TCO (section 269F), and the CEO determines that the application is valid and meets the core criteria (sections 269C, 269B, and 269E), the CEO must issue a written order that specifies the goods to which the concession applies (section 269P(3)). In this case, the TCO No. 0403927 pertains to certain billet sugar cane harvesters, which are subject to item 50 of Schedule 4 of the Customs Tariff Act 1995, with a duty rate of free (section 269P(3)).
The Act imposes certain obligations on both the applicant and the CEO. For the applicant, the primary requirement is to submit a valid application for a TCO, ensuring that the goods in question do not have substitutable goods produced in Australia (section 269C). For the CEO, the obligations include evaluating the application against the core criteria, consulting with relevant stakeholders, and publishing a notice in the Gazette to invite submissions on the application (subsection 269K(1)). The CEO must also ensure that the TCO does not disadvantage any person other than the Commonwealth or impose liabilities on anyone in respect of actions taken before the TCO's effective date (subsection 269SA(2)(b)).
Failure to comply with the requirements of the Customs Act 1901 or the Tariff Concession Instrument No. 0403927 may result in various consequences. While specific offences and penalties are not detailed in the explanatory statement, breaches of customs legislation can generally lead to civil and criminal penalties. These may include fines, imprisonment, or both, depending on the severity of the breach. For instance, knowingly making a false statement in an application for a TCO could lead to criminal charges, with penalties that could include significant fines or imprisonment. Civil penalties might apply for administrative errors or minor infractions, but these specifics are not elaborated upon in the provided text.