EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0508490
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.
RVO Enterprises Pty Ltd applied for a TCO in respect of certain Fork Mixers on 29 June 2005.
Instrument
TCO No 0508490 was made on 9 September 2005. It declares that those certain Fork Mixers 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. 0508490 is taken to have come into force on 29 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. 0508490, enacted in 2005 under the Customs Act 1901, was introduced to provide a concessional tariff rate for certain Fork Mixers, thereby reducing the customs duty on these goods from the general rate of 5% to 0%. This legislative instrument was designed to address the economic disadvantage faced by businesses importing these specific goods by providing them with a lower tariff rate. The instrument was developed in response to an application by RVO Enterprises Pty Ltd, and the Chief Executive Officer of Customs determined that no substitutable goods were produced in Australia, thus meeting the core criteria for a tariff concession order. The instrument was published in the Gazette, inviting any interested parties to submit objections, though none were received. The tariff concession became effective on the date the application was lodged, 29 June 2005, ensuring that importers could benefit from the reduced duty rate retroactively from that date.
Scope and Application
The Tariff Concession Instrument No. 0508490 pertains to the Customs Act 1901, specifically addressing the conditions under which Tariff Concession Orders (TCOs) may be issued by the Chief Executive Officer of Customs (CEO). This legislation applies to any person or entity that applies for a TCO in respect of goods, provided those goods do not fall under the prohibited categories specified in section 269SJ of the Act. The scope of this Act is national, given it operates under the Commonwealth jurisdiction, and it is concerned with goods that are imported into Australia. The Act allows for a lower rate of customs duty for goods that are the subject of a TCO, provided certain criteria are met, including the absence of substitutable goods produced in Australia in the ordinary course of business. This particular TCO No. 0508490 was made for certain Fork Mixers, reducing their customs duty rate from 5% to 0%. The Act also includes provisions for public consultation, requiring the CEO to publish a notice in the Gazette after accepting a TCO application as valid, though in this case, no submissions were received. The commencement of the TCO is effective from the date the application was lodged, which in this instance was 29 June 2005. Importantly, the TCO does not affect the rights of any person as at the date of registration in a way that disadvantages them or imposes new liabilities for actions taken prior to the registration.
Key Provisions
The key provisions of the Tariff Concession Order No. 0508490, which is made under the Customs Act 1901, primarily revolve around the application and approval process for tariff concessions. Section 269F of the Act allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) concerning specific goods. If the CEO is satisfied that the application pertains to goods not excluded by section 269SJ and meets the core criteria under section 269C, a TCO is made. This order declares that the specified goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, effectively reducing the customs duty rate.
The obligations imposed by the Act on the parties involved are straightforward. Firstly, any person who wishes to apply for a TCO must do so by submitting an application to the CEO, ensuring that it pertains to goods not excluded by section 269SJ (subsection 269F). The CEO, upon receiving the application, has the duty to determine whether the application meets the core criteria set out in section 269C. This involves assessing whether no substitutable goods were produced in Australia on the date of application, as defined by sections 269D and 269E. If the CEO finds that the application meets these criteria, they must issue a written TCO (subsection 269P(3)).
In the event of a breach of the provisions of the Customs Act 1901 or the regulations made under it, there are potential civil and criminal consequences. Section 161 of the Customs Act 1901 specifies that any person who contravenes any provision of the Act or the regulations may be liable for penalties. The maximum penalty for a corporation is $21,000, and for an individual, it is $4,200. Furthermore, under section 170, criminal proceedings can be initiated against a person who wilfully contravenes certain provisions of the Act, which may result in imprisonment for up to two years. The Act also provides for additional penalties for false statements or misleading information provided in the context of a TCO application.
The explanatory statement also mentions that the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application, inviting any person who believes there are reasons why the TCO should not be made to lodge a submission (subsection 269K(1)). In the case of TCO No. 0508490, no submissions were received in response to this invitation. Finally, the TCO does not affect the rights of any person, other than the Commonwealth, as at the date of registration so as to disadvantage that person or impose liabilities on a person in respect of anything done or omitted to be done before the date of registration (subsection 269S(1)).