EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0509576
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.
Ford Motor Company of Australia Limited applied for a TCO in respect of certain pick-up/dump/cab/chassis trucks on 19 July 2005.
Instrument
TCO No 0509576 was made on 07 October 2005. It declares that those certain pick-up/dump/cab/chassis trucks 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 free.
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. 0509576 is taken to have come into force on 19 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 Australian Parliament, includes provisions that allow for Tariff Concession Orders (TCOs) to be issued by the Chief Executive Officer of Customs. These TCOs apply a lower rate of customs duty to certain goods, provided they meet specific criteria. The Tariff Concession Instrument No. 0509576, introduced in 2005, was created to address the need for tariff concessions on certain pick-up/dump/cab/chassis trucks, as applied for by Ford Motor Company of Australia Limited. This instrument was designed to ensure that such vehicles are subject to a duty rate of free, as opposed to the general rate of 5%, provided no substitutable goods are produced in Australia. The policy objective is to facilitate the import of these vehicles without imposing additional duties, thereby potentially lowering costs for importers and benefiting the market.
Scope and Application
The Tariff Concession Instrument No. 0509576, made under the Customs Act 1901, applies to the concession of customs duty on certain pick-up/dump/cab/chassis trucks imported by Ford Motor Company of Australia Limited. The instrument is applicable to the specified goods and their importation into Australia, and it is relevant to the entities involved in the importation of these vehicles. The Act applies to the Commonwealth jurisdiction, impacting the customs duty regime and import processes. The application of the TCO is effective from the date the application was lodged, 19 July 2005, and no substitutable goods were produced in Australia on that date, meeting the core criteria for tariff concession. The TCO does not affect the rights of any person except to the benefit of importers who can apply for a refund of duty paid on these goods since the effective date of the TCO. The instrument does not impose any liabilities on any person, ensuring that no one is disadvantaged or subjected to new obligations under the legislation. The Act may extend its application through subordinate instruments, although no such extensions or restrictions are mentioned in the provided text.
Key Provisions
The main operative sections of the Customs Act 1901, as amended by Tariff Concession Instrument No. 0509576, revolve around the establishment and application of Tariff Concession Orders (TCOs) (sections 269C, 269F, 269K, and 269S). Section 269F allows for an application to be made to the Chief Executive Officer of Customs (CEO) for a TCO, which results in a lower rate of customs duty for the goods in question if the CEO determines the application meets the core criteria (section 269C). The CEO must also publish a notice in the Gazette inviting submissions from any interested parties regarding the application (section 269K). If the CEO is satisfied that the application meets the core criteria, a TCO is made, and it comes into effect on the date the application was lodged (section 269S). Section 269P(3) further details the process for the CEO to declare that the goods specified in the TCO application are subject to a prescribed tariff item, as per Schedule 4 to the Customs Tariff Act 1995.
The obligations and requirements imposed by the Act on the parties or entities it governs include the necessity for an applicant to demonstrate that no substitutable goods are produced in Australia in the ordinary course of business (section 269C). The CEO is obligated to assess the application against these criteria, make a written order if satisfied, and publish a notice in the Gazette to allow for any objections (section 269K). The CEO must also ensure that the TCO does not adversely affect the rights of any person other than the Commonwealth in relation to actions taken before the TCO's registration date (section 269S).
In terms of offences, penalties, or civil/criminal consequences for breach, the Act does not explicitly outline penalties for failing to comply with the requirements or conditions of a TCO. However, breaches of the Customs Act 1901 or related regulations could lead to enforcement actions, including fines and potential criminal charges. For instance, knowingly making a false statement in an application for a TCO could be prosecuted under section 239 of the Customs Act 1901, which carries a maximum penalty of five years imprisonment. Furthermore, any person who contravenes a condition of a TCO may be subject to administrative penalties, including financial penalties or other enforcement measures as prescribed by the relevant regulations.