EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0508788
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.
Siemens applied for a TCO in respect of certain Railway Train Detectors on 6 July 2005.
Instrument
TCO No 0508788 was made on 30 September 2005. It declares that those certain Railway Train Detectors 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. 0508788 is taken to have come into force on 6 July 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 amended to introduce the scheme allowing for Tariff Concession Orders (TCOs), which was enacted to address the need for tariff concessions on specific goods where no substitutable goods were produced domestically. The Customs Act 1901, administered by the Parliament of Australia, aims to facilitate international trade by providing mechanisms for the reduction or exemption of customs duties on certain imported goods. The Tariff Concession Instrument No. 0508788 was introduced to provide a tariff concession for Railway Train Detectors, lowering the duty from 5% to 0% after the Chief Executive Officer of Customs was satisfied that no substitutable goods were produced in Australia. The policy objective behind this measure was to support the importation of these specific goods without imposing additional burdens on importers or domestic producers.
Scope and Application
The Tariff Concession Instrument No. 0508788 under the Customs Act 1901 applies specifically to the goods identified in the application made by Siemens for certain Railway Train Detectors. This instrument was made by the Chief Executive Officer of Customs (the CEO) on 30 September 2005 and relates to the goods for which a Tariff Concession Order (TCO) was sought. The Act applies to any person who applies for a TCO in respect of goods, provided the goods do not fall under the exclusions specified in section 269SJ of the Act. The application process requires the CEO to determine whether the core criteria, outlined in sections 269C and 269F of the Act, are met, particularly focusing on whether substitutable goods are produced in Australia in the ordinary course of business. The geographic reach of this legislation is national, as it pertains to the Customs Act 1901, which applies across Australia. The TCO provides a concession by reducing the duty rate from 5% to 0% on the specified goods, and the TCO's application is effective from the date the application was lodged, 6 July 2005. The instrument does not affect any existing rights of persons other than the Commonwealth nor does it impose any new liabilities on persons other than the Commonwealth.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0508788 under the Customs Act 1901 (section 269P(3)) establish a scheme whereby the Chief Executive Officer (CEO) of Customs can make Tariff Concession Orders (TCOs) for specific goods. These orders allow for a lower rate of customs duty to apply to the goods specified in the TCO (section 269C). The instrument provides that the CEO must make a written order if satisfied that the application for a TCO meets the core criteria, which requires that no substitutable goods were produced in Australia on the day the application was lodged (section 269C). For the purposes of this TCO, certain Railway Train Detectors will be subject to a duty rate of 0%, rather than the general rate of 5% (section 269P(3)).
The Act imposes several obligations and requirements on the parties involved in the TCO process. Firstly, section 269K(1) mandates that the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid. This notice includes an invitation for any interested parties to lodge a submission if they believe the TCO should not be made. In this instance, no submissions were received in response to the published notice. Additionally, section 269S(1) stipulates that a TCO is deemed to come into force on the day the application for the TCO was lodged. For TCO No. 0508788, this date is 6 July 2005. The rights of importers will be beneficially affected by this TCO, as they can apply for a refund of duty on goods imported since the day the TCO is taken to have come into force (Regulations, paragraph 126(1)(r)). Importantly, the TCO does not disadvantage any person or impose liabilities on anyone in respect of anything done or omitted before the date of registration.
The Customs Act 1901 does not explicitly detail specific offences, penalties, or civil/criminal consequences for breaches related to TCOs. However, general provisions within the Act concerning customs duties and regulations imply that non-compliance with the conditions of a TCO could result in civil or criminal penalties. The specific penalties would depend on the nature and severity of the breach, but they could include fines or imprisonment under the relevant sections of the Customs Act or other associated legislation. The precise penalties would need to be assessed based on the specific circumstances of the breach.