EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0507309
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 Klystron Input Power Modulators on 10 June 2005.
Instrument
TCO No 0507309 was made on 21 October 2005. It declares that those certain Klystron Input Power Modulators 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. 0507309 is taken to have come into force on 10 June 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. 0507309, enacted in 2005, addresses the need for tariff concessions under the Customs Act 1901 by providing reduced customs duty rates on specific goods, in this case, certain Klystron Input Power Modulators, as determined by the Chief Executive Officer of Customs. This instrument was introduced to support the economic efficiency and competitiveness of Australian industries by allowing concessional tariff rates on goods where no suitable substitutes are produced domestically. The instrument was made in response to an application by Major Projects Victoria, and it aims to ensure that the general rate of duty on these goods, which would otherwise be 5%, is reduced to 0% when the CEO determines that no substitutable goods are produced in Australia. This legislative instrument was enacted by the relevant authority within the framework of the Customs Act 1901, facilitating the Customs Tariff Act 1995 and ensuring that the rights of importers are positively affected while not imposing any liabilities on non-Commonwealth entities.
Scope and Application
The Customs Act 1901 provides a framework for Tariff Concession Orders (TCOs), allowing the Chief Executive Officer of Customs (CEO) to apply lower rates of customs duty on specified goods. This is facilitated through Part XVA of the Act, which outlines the conditions under which TCOs can be made. Specifically, section 269F allows any person to apply to the CEO for a TCO in respect of goods, provided the application does not pertain to goods specified in section 269SJ, which are ineligible for TCOs. The CEO must then assess whether the application meets the core criteria, primarily whether no substitutable goods were produced in Australia on the application date, as defined by sections 269C and 269D. If these criteria are satisfied, the CEO must issue a TCO, as outlined in section 269P(3), which specifies the applicable tariff item for the goods. This particular TCO No. 0507309, made on 21 October 2005, pertains to certain Klystron Input Power Modulators, reducing their duty from 5% to 0%. The application of this Act is national, applying across all jurisdictions in Australia, and it does not impose any new liabilities or disadvantage existing rights of persons other than the Commonwealth.
Key Provisions
The main operative sections of the Customs Act 1901 concerning Tariff Concession Orders (TCOs) are found in Part XVA. Section 269F allows for an application to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. If the CEO determines that the application is valid, they must decide if it meets the core criteria set out in section 269C, which requires that, on the date of application, no substitutable goods were produced in Australia in the ordinary course of business. If these criteria are met, the CEO must make a written order (section 269P(3)) declaring the goods to which a specified item of Schedule 4 to the Customs Tariff Act 1995 applies, thereby reducing the rate of customs duty.
Under this Act, the CEO has the obligation to assess applications for TCOs and determine whether they meet the core criteria. This involves verifying that no substitutable goods were produced in Australia at the time of the application. If an application is deemed valid and meets the criteria, the CEO must issue a TCO. Additionally, as per section 269K(1), the CEO must publish a notice in the Gazette inviting any interested party to submit a response if they believe there are reasons why the TCO should not be made. In the case of TCO No. 0507309, the CEO did not receive any submissions.
For breaches of the requirements set out in the Customs Act 1901, various offences and penalties may apply, although the specific penalties are not detailed in the explanatory statement provided. Generally, the Act includes provisions for both civil and criminal penalties for non-compliance, which could include fines and imprisonment, depending on the severity and intent behind the breach. The specifics of these penalties are usually outlined in related legislation or regulatory instruments, which are not covered in the provided explanatory statement. It is important for parties involved in importing or exporting to ensure full compliance with the Act to avoid any potential legal repercussions.