EXPLANATORY STATEMENT
Tariff Concession Instrument No.0500954
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.
Department of Transport and Urban Planning applied for a TCO in respect of certain trams on 19 January 2005.
Instrument
TCO No 0500954 was made on 4 April 2005. It declares that those certain trams 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 No0500954 is taken to have come into force on 19 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 Customs Act 1901 was enacted by the Australian Parliament to facilitate and regulate the import and export of goods into and out of Australia. It established a comprehensive framework for customs duties, and among other things, provides the mechanism for Tariff Concession Orders (TCOs) to offer reduced customs duty rates on certain goods under specific circumstances. This instrument addresses the gap in the legislative framework by providing a process for applying for and granting tariff concessions to encourage the importation of goods that are not produced domestically, thereby supporting competitive markets and consumer choice. The Tariff Concession Instrument No. 0500954 was introduced to provide tariff concessions for specific trams, reflecting the policy objective of facilitating the import of these goods at a reduced duty rate where no suitable domestic alternatives exist. This approach aims to benefit importers by lowering their duty liabilities and ensuring access to a broader range of goods.
Scope and Application
The Customs Act 1901, as amended, applies to the application process for Tariff Concession Orders (TCOs), which allow for a lower rate of customs duty on specified goods. This legislation is applicable to individuals and entities seeking to import goods that are not currently produced in Australia in the ordinary course of business. The scope of the Act extends to all goods that are subject to a TCO application, provided that these goods are not specified in section 269SJ of the Act, which excludes certain goods from TCO eligibility. The Act operates at the Commonwealth level, with the Chief Executive Officer of Customs responsible for evaluating and making decisions on TCO applications. The application process is initiated by a submission to the CEO, followed by a publication in the Gazette to invite any interested parties to lodge submissions. If no submissions are received, the CEO proceeds to decide on the application based on the criteria set out in the Act. The commencement of a TCO is deemed to occur on the date the application is lodged, ensuring that any eligible importers can benefit from the reduced duty rate retroactively from that date. The Act also ensures that the rights of importers are positively affected, with provisions for duty refunds under the Regulations, while explicitly stating that no new liabilities are imposed on any person as a result of the TCO.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0500954 (TCO No 0500954) under the Customs Act 1901 (section 269F) establish that the Chief Executive Officer of Customs (CEO) can make a Tariff Concession Order (TCO) for certain goods. Specifically, section 269C outlines the core criteria that a TCO application must meet, primarily that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Section 269P(3) mandates that if the CEO is satisfied that these criteria are met, they must issue a written TCO, which in this case, applies to certain trams with a reduced duty rate from 5% to 3% (section 269P(3)).
The obligations and requirements imposed by the Act on the parties involved include the necessity for the CEO to assess applications against the criteria set out in section 269C. The Department of Transport and Urban Planning, in this instance, must demonstrate that no substitutable goods were produced in Australia to satisfy these criteria. Additionally, as stipulated in subsection 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any interested parties who might oppose the TCO. For TCO No 0500954, no submissions were received, indicating that no opposition was raised.
Offences, penalties, or consequences for non-compliance with the provisions of the Customs Act 1901 are not explicitly detailed in the provided text. However, the general legal framework under which the Act operates suggests that any breach of its provisions, including the misuse of a TCO or failure to comply with the terms of the order, could lead to civil or criminal penalties. The maximum penalties for such breaches would be determined in accordance with the specific provisions of the Customs Act 1901 and any related regulations, which might include fines or imprisonment depending on the severity and intent of the breach. The Act also ensures that the rights of importers are protected and can benefit from duty refunds for goods imported since the TCO came into effect, without imposing any liabilities on them.