EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0412369
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.
Suzuki Australia Pty Ltd applied for a TCO in respect of certain four wheel all terrain vehicles on 18 November 2004.
Instrument
TCO No 0412369 was made on 1 February 2005. It declares that those certain four wheel all terrain vehicles are goods to which item 50A 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 0%.
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. 0412369 is taken to have come into force on 18 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. 0412369 was enacted under the Customs Act 1901 with the purpose of providing tariff concessions for specific goods. This instrument was introduced to address the need for a streamlined process in granting tariff concessions for goods that are not produced in Australia or for which there are no suitable substitutes produced domestically. This legislative instrument was enacted by the Chief Executive Officer of Customs, following the application by Suzuki Australia Pty Ltd for tariff concessions on certain four-wheel all-terrain vehicles. The policy objective of this legislation is to provide tariff relief for imported goods that do not have domestic alternatives, thus promoting fair competition and supporting the importation of goods that are not produced in Australia.
Scope and Application
The Tariff Concession Instrument No. 0412369, made under the Customs Act 1901, applies to individuals or entities that seek tariff concessions for specific goods imported into Australia. This particular instrument pertains to Suzuki Australia Pty Ltd's application for tariff concessions on certain four-wheel all-terrain vehicles, aiming to reduce the customs duty rate from 5% to 0%. The application was processed by the Chief Executive Officer of Customs (CEO) who assessed whether the core criteria under the Act were met, particularly if no substitutable goods were being produced in Australia at the time of the application. Once the CEO determined that the core criteria were satisfied, a Tariff Concession Order (TCO) was issued, effective from the date the application was lodged, 18 November 2004. The geographic scope of this Act is national, given it operates under the Commonwealth's authority. Exclusions under section 269SJ of the Act, which details goods not eligible for a TCO, were considered during the CEO's assessment. The application of this TCO does not retroactively affect any rights or impose liabilities on persons other than the Commonwealth for actions taken before the TCO's registration date, while potentially benefiting importers by allowing them to apply for duty refunds from the effective date.
Key Provisions
The Tariff Concession Order (TCO) No. 0412369, made under section 269P(3) of the Customs Act 1901, provides a specific tariff concession for certain four wheel all terrain vehicles, declaring that these goods are subject to a zero rate of customs duty, as specified in item 50A of Schedule 4 to the Customs Tariff Act 1995. This order was made after Suzuki Australia Pty Ltd applied for the concession on 18 November 2004, and it came into force on the same day, as per subsection 269S(1) of the Act. The decision to grant the concession was based on the Chief Executive Officer of Customs (CEO) being satisfied that no substitutable goods were being produced in Australia, as outlined in section 269C of the Act.
The Act imposes several obligations on the CEO when processing an application for a TCO. First, under section 269F, the CEO must consider whether the goods in question are specified in section 269SJ, which lists goods that cannot be subject to a TCO. If the CEO determines that the application does not pertain to these restricted goods, the next step is to assess whether the application meets the core criteria. This assessment involves verifying, as per section 269C, that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. The CEO must also ensure that the definitions of 'goods produced in Australia', 'ordinary course of business', and 'substitutable goods' are correctly applied, as per sections 269D, 269E, and 269F of the Act. Additionally, under subsection 269K(1), the CEO is required to publish a notice in the Gazette inviting any interested parties to submit submissions if they believe there are reasons why the TCO should not be made.
Failure to comply with the provisions of the Customs Act 1901 in relation to TCOs can lead to significant legal consequences. Although the Act does not explicitly list offences or penalties for breaches related to TCOs, the general legal framework under which the Customs Act operates implies that non-compliance could result in enforcement actions, including fines or other civil penalties. The exact penalties would depend on the specific breach and could be enforced under other sections of the Customs Act or related legislation. Furthermore, the Act ensures that the TCO does not affect the rights of any person, other than the Commonwealth, as at the date of registration, thereby preventing any disadvantage or imposition of liabilities for actions taken before the TCO's registration.