EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0510000
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.
Biesse Group Australia Pty Limited applied for a TCO in respect of certain computer numeric controlled stone workers on 01 August 2005.
Instrument
TCO No 0510000 was made on 07 October 2005. It declares that those certain computer numeric controlled stone workers 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. 0510000 is taken to have come into force on 01 August 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, includes provisions for Tariff Concession Orders (TCOs) to provide relief from customs duties on certain goods. These concessions are applicable when goods do not have Australian substitutes and are in line with the core criteria set out in the Act. The Tariff Concession Instrument No. 0510000 was introduced to facilitate the application process for these tariff concessions. Specifically, this instrument was created to address the application by Biesse Group Australia Pty Limited for a TCO on certain computer numeric controlled stone workers, effective from 01 August 2005. The objective of this legislation is to ensure that when a TCO application is made, it is processed efficiently, with appropriate public consultation, and that the resulting tariff concessions do not disadvantage existing rights or impose new liabilities on individuals or entities.
Scope and Application
The Tariff Concession Instrument No. 0510000, made under the Customs Act 1901, applies to entities or individuals seeking tariff concessions for specific goods. It particularly pertains to the case of Biesse Group Australia Pty Limited, which applied for tariff concessions for certain computer numeric controlled stone workers. The application was accepted by the Chief Executive Officer of Customs, who determined that no substitutable goods were produced in Australia on the date of the application, thus meeting the core criteria under the Act. This instrument is effective from the date of the application, 01 August 2005, and establishes that the goods in question are subject to a zero rate of duty, differing from the general rate of 5%. The instrument does not impose any liabilities on any person and does not affect the rights of any person as at the date of registration, except to potentially benefit importers who can apply for a refund of duty. The scope of this instrument is national, as it operates within the framework set by Commonwealth legislation, and it does not extend to any goods specified in section 269SJ of the Customs Act 1901, which are ineligible for tariff concessions.
Key Provisions
The primary operative sections of the Customs Act 1901 concerning Tariff Concession Orders (TCOs) are sections 269C, 269B, 269D, 269E, and 269P. Section 269C sets the core criteria for approving a TCO application, requiring that no substitutable goods were produced in Australia on the day the application was lodged. Section 269B defines terms such as 'goods produced in Australia', 'ordinary course of business', and 'substitutable goods'. Section 269P(3) mandates the CEO to issue a written TCO if the application meets these criteria. Section 269SJ outlines goods ineligible for TCOs. The TCO reduces the customs duty on specified goods, such as computer numeric controlled stone workers in this case, from a general rate of 5% to free duty.
The obligations imposed by the Act on parties and entities include ensuring that any application for a TCO is lodged in accordance with section 269F, and that the CEO follows the outlined procedures to assess the application against the core criteria specified in section 269C. The CEO is also required to publish a notice in the Gazette under subsection 269K(1), inviting submissions on the application. If no submissions are received, the CEO proceeds to make the TCO. Importers benefit from this process by being able to apply for a refund of duty on goods imported since the effective date of the TCO, as stipulated in paragraph 126(1)(r) of the Regulations.
In terms of consequences for breach, the Act does not explicitly outline offences, penalties, or civil/criminal consequences for failing to comply with its provisions. However, failure to adhere to the established procedures for applying for and issuing TCOs could result in the nullification of the TCO, leading to the continued imposition of the general rate of customs duty on the goods in question. Additionally, any misrepresentation or fraudulent application could potentially lead to legal action or penalties under other relevant sections of the Customs Act 1901 or other applicable legislation.