EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0412848
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.
Comalco Aluminium Bell Bay Ltd applied for a TCO in respect of certain tool turrets on 23 November 2004.
Instrument
TCO No 0412848 was made on 1 February 2005. It declares that those certain tool turrets 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. 0412848 is taken to have come into force on 23 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 Parliament of Australia, establishes a framework for the imposition of customs duties, including the ability to grant tariff concession orders (TCOs) that reduce the duty payable on certain imported goods. Specifically, Tariff Concession Instrument No. 0412848 was introduced to address the issue of granting concessions on customs duties for particular imported goods. This was enacted to facilitate the import of specific goods such as tool turrets by Comalco Aluminium Bell Bay Ltd, which applied for these concessions on 23 November 2004. The instrument was made on 1 February 2005 by the Chief Executive Officer of Customs, who determined that no substitutable goods were produced in Australia, thereby satisfying the core criteria under section 269C of the Act. The policy objective behind this legislation is to support the efficient operation of businesses by reducing the cost of importing certain goods, ultimately benefiting importers by allowing them to claim duty refunds for imports made since the effective date of the concession.
Scope and Application
The Customs Act 1901 applies to all individuals, businesses, and entities involved in the importation of goods into Australia. Specifically, the Act governs the imposition of customs duty and the administration of tariff concessions, as evidenced by Tariff Concession Orders (TCOs) such as TCO No. 0412848. This particular TCO pertains to certain tool turrets and was made by the Chief Executive Officer of Customs, who is tasked with determining whether applications for tariff concessions meet the core criteria outlined in the Act. The geographic reach of this Act is national, as it applies across all states and territories in Australia. The Act excludes certain goods from tariff concessions, as specified in section 269SJ, and may extend or restrict its application through subordinate instruments. The application of this legislation ensures that the importation of goods is managed effectively while providing necessary relief to importers through tariff concessions where applicable.
Key Provisions
The Tariff Concession Instrument No. 0412848 (the Instrument), made under the Customs Act 1901 (the Act), sets out the conditions for a reduced rate of customs duty on specific goods, in this case certain tool turrets. This concession applies when no substitutable goods are produced in Australia in the ordinary course of business, as per section 269C of the Act. The instrument declares that the tool turrets in question are subject to a duty rate specified in item 50 of Schedule 4 to the Customs Tariff Act 1995, reducing the duty from the general rate of 5% to a concessional rate of 3%.
The Act imposes certain obligations on the Chief Executive Officer of Customs (the CEO) when considering an application for a Tariff Concession Order (TCO). Under section 269F of the Act, the CEO must evaluate the application to ensure it does not concern goods specified in section 269SJ, which are ineligible for TCOs. The CEO must also confirm that the application meets the core criteria outlined in section 269C, specifically that no substitutable goods were produced in Australia in the ordinary course of business. Once these criteria are satisfied, the CEO is required to issue a written TCO, as stipulated in subsection 269P(3) of the Act. In this instance, the CEO issued TCO No. 0412848 on 1 February 2005, following the acceptance of the application from Comalco Aluminium Bell Bay Ltd on 23 November 2004.
The Act also mandates that the CEO publish a notice in the Gazette, inviting any interested parties to submit objections if they believe the TCO should not be granted. This requirement is detailed in subsection 269K(1) of the Act. In this case, the CEO did not receive any submissions opposing the TCO, and it subsequently came into force on the date the application was lodged, 23 November 2004, as per subsection 269S(1) of the Act. Importantly, the TCO does not adversely affect any rights of individuals or entities other than the Commonwealth, nor does it impose any liabilities on anyone in relation to actions taken before the TCO’s registration date.
In terms of consequences, breaches of the conditions set out in the TCO or failure to comply with the requirements of the Act could lead to legal actions. While specific penalties are not detailed in the explanatory statement, breaches of customs regulations generally can result in both civil and criminal penalties, including fines and imprisonment. The exact penalties would depend on the nature and severity of the breach, and would be determined in accordance with the relevant provisions of the Customs Act 1901 and any associated regulations.