EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0411759
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.
Volvo Finance Australia Pty Ltd applied for a TCO in respect of certain articulated loaders on 8 November 2004.
Instrument
TCO No 0411759 was made on 4 February 2005. It declares that those certain articulated loaders 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 3%.
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. The CEO did not receive any submissions in response to this invitation.
Commencement
Subsection 269S(1) relevantly provides that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged. TCO No. 0411759 is taken to have come into force on 8 November 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 Tariff Concession Instrument No. 0411759 was enacted in 2005 as a legislative instrument under the Customs Act 1901. This instrument was introduced to address the need for tariff concessions for specific goods, allowing for a reduction in customs duty on certain articulated loaders, thereby promoting competitive pricing and accessibility of these goods in the Australian market. The instrument was created following an application by Volvo Finance Australia Pty Ltd and was enacted by the Chief Executive Officer of Customs, who determined that the articulated loaders in question did not have substitutable goods produced in Australia, meeting the core criteria set out in the Act. This legislative instrument ensures that the rights of importers are positively affected, as they can apply for a refund of duty on these goods from the date the tariff concession order came into effect, while not imposing any liabilities on any person.
Scope and Application
The Tariff Concession Instrument No. 0411759, made under Part XVA of the Customs Act 1901, applies to articulated loaders for which Volvo Finance Australia Pty Ltd applied for tariff concession. The Act applies to the Chief Executive Officer of Customs, who has the authority to make Tariff Concession Orders (TCOs) that reduce the rate of customs duty for specified goods, provided the goods are not listed in section 269SJ of the Act and meet the core criteria as outlined in sections 269B and 269C. This concession applies to goods imported into Australia, thereby extending its reach nationally within the Commonwealth. The application of this TCO is effective from the date the application was lodged, 8 November 2004, as per the provisions in subsection 269S(1) of the Act. No exclusions, exemptions, or thresholds are explicitly mentioned in the explanatory statement, but the Act ensures that the TCO does not adversely affect the rights of any person other than the Commonwealth or impose any liabilities on anyone in respect of actions taken before the TCO was registered.
Key Provisions
The main operative sections of the Customs Act 1901, particularly as they relate to Tariff Concession Orders (TCOs), are sections 269C, 269F, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO regarding specific goods. If the application is deemed valid and meets the core criteria, the CEO is obligated to make a written TCO under section 269P, declaring that the goods in question are subject to a lower rate of duty specified in the Customs Tariff Act 1995. Section 269C sets out the core criteria for a TCO, requiring that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged.
Entities subject to the Customs Act 1901 must comply with the obligations set forth in the Act when applying for a TCO. Specifically, applicants must ensure that their applications are valid and meet the core criteria outlined in section 269C. Once an application is accepted, the CEO must publish a notice in the Gazette, inviting any interested parties to submit objections. In the case of TCO No. 0411759, the CEO did not receive any objections, indicating that no party contested the issuance of the TCO. Additionally, the Act ensures that the TCO does not disadvantage any person or impose new liabilities on anyone except the Commonwealth.
In terms of penalties and consequences, the Act does not explicitly outline criminal or civil penalties for failing to comply with the provisions regarding TCOs. However, any failure to meet the requirements for a TCO application or non-compliance with the Act could result in the application being rejected by the CEO. This could lead to continued higher rates of duty for the goods in question, impacting the financial obligations of importers. It is important to note that the TCO does not affect the rights of any person as at the date of registration, ensuring that no one is disadvantaged by the concession order.
Overall, the Act provides a structured process for applying for and issuing Tariff Concession Orders, ensuring that only those goods that meet specific criteria receive lower customs duties. The obligations on applicants and the CEO are clear, and while the Act does not specify severe penalties for non-compliance, it ensures that the process is fair and transparent, protecting the rights of all parties involved.