EXPLANATORY STATEMENT
Tariff Concession Instrument No.0500568
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.
Parker Electroplating Pty Ltd applied for a TCO in respect of certain coating and drying lines on 10 January 2005.
Instrument
TCO No 0500568 was made on 29 March 2005. It declares that those certain coating and drying lines 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. 0500568 is taken to have come into force on 10 January 2005.
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. 0500568, enacted in 2005, is a measure under the Customs Act 1901 designed to facilitate tariff concessions for specific goods. This instrument was introduced to address the need for reducing customs duties on particular imported goods, thereby potentially stimulating trade and economic activity by making these goods more affordable. The instrument allows for a lower rate of customs duty to apply to the specified goods, provided that no substitutable goods are produced in Australia in the ordinary course of business. The Customs Act 1901, enacted by the Australian Parliament, provides the framework for the creation of such tariff concession orders, with the Chief Executive Officer of Customs having the authority to make these orders upon meeting specific criteria. The policy objective of this instrument is to provide tariff relief on certain goods, enhancing their accessibility and potentially encouraging their import and use within Australia.
Scope and Application
The Customs Act 1901, specifically under Part XVA, facilitates the application of Tariff Concession Orders (TCOs) which allow for a lower rate of customs duty on certain goods. This Act applies to any person or entity that seeks to import goods eligible for tariff concessions, provided the goods in question are not specified in section 269SJ of the Act, which excludes certain goods from tariff concessions. The application process involves submitting an application to the Chief Executive Officer of Customs, who then evaluates the application against core criteria stipulated in sections 269C, 269B, and 269D. If satisfied, the CEO issues a TCO, reducing the duty on the specified goods. For instance, Parker Electroplating Pty Ltd successfully applied for a TCO on certain coating and drying lines, resulting in a reduced duty rate from 5% to 3%. The Act's jurisdictional reach extends nationally, and its application can be further detailed or restricted through subordinate instruments. Importantly, the TCO does not disadvantage any person or impose liabilities for actions taken prior to its effective date, although it does provide benefits such as duty refunds to importers from the date of the TCO's commencement.
Key Provisions
The Tariff Concession Instrument No. 0500568, made under the Customs Act 1901, applies to certain coating and drying lines, specifically declaring these goods to be subject to a lower rate of customs duty. Section 269F of the Act allows for applications to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO). The CEO must assess whether the application meets the core criteria set out in section 269C, which requires that no substitutable goods were produced in Australia on the day the application was lodged. In this case, Parker Electroplating Pty Ltd applied for the concession on 10 January 2005, and the CEO was satisfied that the application met the criteria, resulting in the issuance of TCO No. 0500568 on 29 March 2005.
The obligations under this legislation require that any application for a TCO be made in accordance with the provisions of section 269F, and the CEO must evaluate whether the application adheres to the core criteria in section 269C. The CEO is also mandated to publish a notice in the Gazette under subsection 269K(1), inviting any interested parties to submit objections if they believe the TCO should not be made. For this particular TCO, no objections were received. Furthermore, the TCO is deemed to come into effect on the day the application was lodged, as stated in subsection 269S(1).
Breaching the requirements of the Customs Act 1901 can result in both civil and criminal consequences. For instance, failure to comply with the provisions regarding the application and issuance of TCOs may result in the imposition of penalties under the relevant sections of the Act. Although the specific penalties are not detailed in the Explanatory Statement, general penalties for breaches of customs laws can include fines and, in some cases, imprisonment, depending on the severity of the offence. The Act ensures that the rights of importers are positively affected by such concessions, allowing them to apply for duty refunds on goods imported since the TCO's effective date.