EXPLANATORY STATEMENT
Tariff Concession Instrument No.0502569
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.
Duncan’s Holdings Limited applied for a TCO in respect of certain timber handlers/sorters on 24 February 2005.
Instrument
TCO No 0502569 was made on 6 May 2005. It declares that those certain timber handlers/sorters 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. 0502569 is taken to have come into force on 24 February 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, enacted by the Australian Parliament, provides a framework under which Tariff Concession Orders (TCOs) can be issued to reduce customs duty on certain goods. This legislation was introduced to address the need for tariff concessions to ensure that Australian businesses can access goods at reduced rates, which in turn supports economic competitiveness and efficiency. The Explanatory Statement outlines Tariff Concession Instrument No. 0502569, which was created to address Duncan’s Holdings Limited's application for a TCO on certain timber handlers/sorters. The policy objective here is to facilitate reduced customs duty for these specific goods, thereby benefiting importers by potentially allowing them to claim duty refunds for imports made since the TCO's effective date. The instrument ensures that the rights of persons other than the Commonwealth are not adversely affected by the concession.
Scope and Application
The Tariff Concession Instrument No. 0502569 under the Customs Act 1901 applies to Duncan’s Holdings Limited's application for a Tariff Concession Order (TCO) concerning certain timber handlers/sorters. This application is subject to the criteria set out in sections 269C and 269P of the Act, ensuring that the goods in question are not substitutable by any goods produced in Australia in the ordinary course of business. The instrument, which came into force on the date of the application, 24 February 2005, grants a reduced rate of customs duty for these specific goods, from the general rate of 5% to a concessional rate of 3%. The instrument's application is limited to the geographic scope of Australia and does not extend beyond the provisions of the Customs Act 1901 and the Customs Tariff Act 1995. Any exclusions or exemptions from the application of this TCO are governed by the specific conditions outlined in section 269SJ of the Customs Act 1901, which details the goods that cannot be subject to a TCO. The instrument does not disadvantage any person or impose liabilities on anyone in respect of anything done or omitted before its registration.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0502569 under the Customs Act 1901 (section 269F) allow for the application to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO) in respect of certain goods. Specifically, section 269C stipulates that a TCO application meets the core criteria if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. If the CEO is satisfied that the application meets these criteria, they must make a written TCO (section 269P(3)), declaring that the goods in question are subject to a prescribed rate of duty specified in the Customs Tariff Act 1995.
The obligations imposed by the Act on the parties involved include the requirement for applicants to ensure their applications meet the core criteria, specifically that no substitutable goods were produced in Australia on the application date (section 269C). The CEO must then assess the application against these criteria and, if satisfied, issue a TCO (section 269P(3)). The CEO is also required to publish a notice in the Gazette inviting submissions from any interested parties who might have reasons why the TCO should not be made (subsection 269K(1)).
In terms of breaches and penalties, the Act does not explicitly detail offences or penalties for failing to comply with the TCO requirements. However, any failure to adhere to the conditions set by the TCO could potentially result in legal consequences under other relevant sections of the Customs Act 1901 or associated regulations. For example, under the general provisions of the Act, failure to comply with customs regulations could lead to civil or criminal penalties, including fines and imprisonment. The specifics of such penalties would depend on the nature and severity of the breach.