EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0412234
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.
Air International Pty Ltd applied for a TCO in respect of certain throttle controls on 12 November 2004.
Instrument
TCO No 0412234 was made on 4 February 2005. It declares that those certain throttle controls 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. 0412234 is taken to have come into force on 12 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 Customs Act 1901, enacted by the Australian Parliament, establishes a framework for the application and administration of customs duties and provides the basis for the creation of Tariff Concession Orders (TCOs). These orders, administered by the Chief Executive Officer of Customs, allow for reduced customs duty rates on specified goods, provided that the application meets specific criteria and there are no substitutable goods produced in Australia. The Act aims to provide tariff relief to importers and promote economic efficiency by reducing the cost of imported goods. Instrument No. 0412234, made under this Act, applies a reduced rate of duty to certain throttle controls, as no substitutable goods were found to be produced in Australia. The policy objective is to ensure that importers are not disadvantaged and to facilitate the timely and efficient processing of tariff concession applications.
Scope and Application
The Tariff Concession Order (TCO) No 0412234 applies to certain throttle controls, which are goods that are subject to a lower rate of customs duty under the Customs Act 1901. The Act governs the application process for TCOs, which allows for tariff concessions on specific goods, provided certain criteria are met. The legislation applies to any person who makes an application for a TCO under section 269F of the Act, and the process is overseen by the Chief Executive Officer of Customs, who must ensure that the application meets the core criteria outlined in sections 269C, 269D, and 269E of the Act. These criteria include the absence of substitutable goods produced in Australia at the time of the application. The TCO is applicable nationwide as it is a Commonwealth Act, and its provisions extend to all territories and states within Australia. There are exclusions specified in section 269SJ of the Act, which details the types of goods that cannot be subject to a TCO. The application of this Act may be extended or modified through subordinate instruments, such as regulations or orders, which could provide further detail or specific conditions under which the TCO applies.
Key Provisions
The main operative sections of this legislation (sections 269C, 269B, 269E, 269P(3) and 269K(1)) establish the criteria for making a Tariff Concession Order (TCO) and the process for applying for such an order. A TCO application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business (section 269C). If the Chief Executive Officer (CEO) of Customs is satisfied that a TCO application meets the core criteria, they must make a written order (section 269P(3)). The CEO must also publish a notice in the Gazette as soon as practicable after accepting a TCO application as a valid application, inviting any person who considers there are reasons why the TCO should not be made to lodge a submission with the CEO (section 269K(1)).
The Act imposes several obligations and requirements on the parties it governs. Firstly, an applicant must ensure that their TCO application meets the core criteria, specifically that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. The CEO is required to make a written order if the application meets the core criteria. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any person who considers there are reasons why the TCO should not be made.
The Act also sets out consequences for breaches of its provisions. The Explanatory Statement does not specify any offences, penalties, or civil/criminal consequences for breach. However, it is likely that failure to comply with the requirements of the Act could result in legal action being taken against the non-compliant party, potentially leading to financial penalties or other legal consequences.
Overall, the Tariff Concession Instrument No. 0412234 sets out a scheme for making TCOs under the Customs Act 1901. It establishes the criteria for making a TCO and the process for applying for such an order. The Act imposes obligations and requirements on the parties it governs, including the applicant and the CEO. While the Explanatory Statement does not specify any offences, penalties, or civil/criminal consequences for breach, it is likely that failure to comply with the requirements of the Act could result in legal action being taken against the non-compliant party.