EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0505337
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.
Major Projects Victoria applied for a TCO in respect of certain Ultra High Vacuum Valves on 10 May 2005.
Instrument
TCO No 0505337 was made on 16 September 2005. It declares that those certain Ultra High Vacuum Valves 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 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. 0505337 is taken to have come into force on 10 May 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. 0505337, made under the Customs Act 1901, was enacted in 2005 to address the need for tariff concessions on specific imported goods that were not being produced domestically. This legislation allows for a lower rate of customs duty on certain goods, in this case, Ultra High Vacuum Valves, by applying a Tariff Concession Order (TCO). The TCO process was initiated when Major Projects Victoria applied for tariff concessions on these valves, which were subsequently approved by the Chief Executive Officer of Customs. The policy objective is to support industries by ensuring access to necessary imported goods at a reduced duty rate, provided that no substitutable goods are produced in Australia. The instrument does not disadvantage any person and allows for duty refunds for importers of these goods from the date the TCO was deemed to have come into effect.
Scope and Application
The Tariff Concession Instrument No. 0505337, made under the Customs Act 1901, applies to individuals or entities who have applied for and been granted a Tariff Concession Order (TCO) for specific goods. This legislation specifically pertains to the application of a reduced rate of customs duty on Ultra High Vacuum Valves, which Major Projects Victoria sought and obtained on 10 May 2005. The instrument was formalised on 16 September 2005 by the Chief Executive Officer of Customs, who determined that no substitutable goods were produced in Australia, thereby meeting the core criteria outlined in section 269C of the Act. The geographic and jurisdictional reach of this Act is national, as it is enacted under the Commonwealth of Australia. The application of this Act is not restricted by any specific exclusions or exemptions, though it does not affect the rights of any person other than the Commonwealth in terms of liabilities for actions taken prior to the registration date of the TCO. This Act extends its application through the subordinate Customs Tariff Act 1995, specifically referencing Schedule 4, item 50, which specifies the tariff applicable to the goods in question.
Key Provisions
The main operative sections of this legislation, specifically under the Customs Act 1901, include sections 269C, 269F, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of goods, provided that the goods are not specified in section 269SJ. If the application meets the core criteria outlined in section 269C, the CEO must make a written order (TCO) specifying that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. Section 269P(3) further specifies that the CEO must make this order if satisfied that the application meets the core criteria, which includes ensuring that no substitutable goods were produced in Australia on the day the application was lodged.
The obligations imposed by the Act on the parties it governs are primarily on the CEO, who must assess TCO applications to ensure they meet the core criteria. The CEO must also publish a notice in the Gazette, inviting submissions from any person who considers that there are reasons why the TCO should not be made, as required by subsection 269K(1) of the Act. This ensures a level of transparency and opportunity for stakeholders to voice their concerns. Additionally, the Act ensures that the TCO does not affect the rights of any person adversely, providing protection to those who may be impacted by the concession.
In terms of offences, penalties, or civil/criminal consequences, the Act does not explicitly state penalties for breaches of the TCO provisions. However, it does clarify that the TCO does not impose any liabilities on any person and does not disadvantage any person or impose liabilities in respect of actions taken before the registration date. This means that any breach of the terms of the TCO would likely be subject to the general legal consequences applicable to breaches of administrative orders, which could include administrative penalties, court-ordered remedies, or other legal actions depending on the nature and severity of the breach.