EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0509092
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.
Hyne and Son Pty Ltd applied for a TCO in respect of certain Trimming and Optimising Sawlines Parts 12 July 2005.
Instrument
TCO No 0509092 was made on 23 September 2005. It declares that those certain Trimming and Optimising Sawlines Parts 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. 0509092 is taken to have come into force on 12 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, enacted by the Parliament of Australia, establishes a framework under which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs. These orders provide reduced customs duty rates for specified goods, provided they meet the core criteria outlined in the Act. The primary objective of this legislative instrument is to facilitate the reduction of customs duty for certain goods, thereby potentially lowering import costs and stimulating trade. In the case of Tariff Concession Instrument No. 0509092, enacted on 23 September 2005, the instrument addresses the need for tariff concessions on certain Trimming and Optimising Sawlines Parts, setting the duty rate at 0% for these goods as no substitutable goods were produced in Australia at the time of the application. This measure aims to support the import of these specific parts by reducing the financial burden on importers, in alignment with the policy of encouraging trade through tariff concessions.
Scope and Application
The Customs Act 1901, as amended by Tariff Concession Instrument No. 0509092, applies to individuals and entities seeking tariff concessions for specific goods imported into Australia. This legislation allows the Chief Executive Officer of Customs to grant lower rates of customs duty for goods specified in a Tariff Concession Order (TCO), provided the application meets certain criteria and no substitutable goods are produced in Australia. The Act's jurisdictional reach extends nationally, impacting importers who can benefit from reduced duty rates for the specified goods. The TCO in question, effective from 12 July 2005, pertains to certain Trimming and Optimising Sawlines Parts, reducing their duty rate from 5% to 0%. The application process requires public consultation, although no submissions were received in response to the notice published in the Gazette for this particular TCO. The Act ensures that the TCO does not disadvantage any person or impose liabilities on them for actions taken before the TCO's registration date.
Key Provisions
The main operative sections of this legislation focus on the process and criteria for making Tariff Concession Orders (TCOs) under the Customs Act 1901 (section 269F). An application for a TCO can be made by any person, and if the Chief Executive Officer (CEO) of Customs determines that the application pertains to goods not listed in section 269SJ, the application is assessed against the core criteria specified in section 269C. If the CEO is satisfied that no substitutable goods are produced in Australia in the ordinary course of business, a TCO is issued (section 269P(3)). This instrument specifically addresses Trimming and Optimising Sawlines Parts, assigning them to item 50 of Schedule 4 of the Customs Tariff Act 1995, thereby applying a zero rate of duty instead of the general 5% rate.
The obligations and requirements imposed by this legislation primarily pertain to the CEO of Customs. The CEO must ensure that any TCO application is assessed against the specified core criteria, and if satisfied, a TCO must be issued. Furthermore, the CEO is required to publish a notice in the Gazette inviting any person to submit any objections to the TCO application (subsection 269K(1)). In this instance, the CEO did not receive any submissions, and therefore proceeded to issue the TCO.
For breaches of the provisions within this legislation, there are potential civil and criminal consequences. While the specific penalties are not detailed in the explanatory statement, breaches of the Customs Act 1901 generally can lead to significant penalties. The potential penalties for contravening customs regulations can include substantial fines and, in severe cases, imprisonment. The exact penalties depend on the nature and severity of the breach, as outlined in the respective sections of the Customs Act 1901.