EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0511529
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.
Independent Tyre Distributors applied for a TCO in respect of certain tyres on 02 September 2005.
Instrument
TCO No 0511529 was made on 18 November 2005. It declares that those certain tyres 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. 0511529 is taken to have come into force on 02 September 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. 0511529, enacted in 2005 under the Customs Act 1901, was introduced to provide relief on customs duties for specific goods, in this case, certain tyres. The instrument was created to address the need for concessional tariffs on goods that are not produced domestically, thereby reducing the financial burden on importers and potentially stimulating market growth. The Tariff Concession Order (TCO) was made by the Chief Executive Officer of Customs, who is mandated under the Act to assess applications for tariff concessions and determine whether they meet the core criteria. This specific instrument came into effect on 2 September 2005, the date on which the application for the concession was lodged, and no objections were received during the consultation period. The enactment of this instrument ensures that the rights of importers are protected and can potentially benefit from duty refunds for goods imported since the effective date of the TCO.
Scope and Application
The Tariff Concession Instrument No. 0511529 under the Customs Act 1901 applies to entities and individuals seeking tariff concessions on goods that are imported into Australia. The legislation is designed to allow the Chief Executive Officer of Customs to reduce the customs duty on certain goods, provided the application meets the core criteria outlined in section 269C of the Act, which requires that no substitutable goods were produced in Australia at the time the application was lodged. The instrument specifically addresses applications from Independent Tyre Distributors for certain tyres, which were granted a tariff concession making the duty on these goods free, down from the general rate of 5%. The geographic reach of this legislation is national, applying across all jurisdictions in Australia. The Act does not impose any liabilities on individuals or entities other than the Commonwealth and does not disadvantage existing rights of persons other than the Commonwealth. The application process includes a requirement for the CEO to publish a notice in the Gazette, inviting submissions from interested parties, though in this instance, no submissions were received. The tariff concession becomes effective from the date the application was lodged, providing immediate benefits to importers who can apply for refunds on duties paid prior to the concession being granted.
Key Provisions
The Tariff Concession Order No. 0511529 under the Customs Act 1901 (the Act) (section 269C) is a pivotal instrument that reduces customs duty on specific goods. The application for this order, lodged by Independent Tyre Distributors on 02 September 2005, pertains to certain tyres. The CEO, upon satisfaction that the application complies with the core criteria and no substitutable goods were produced in Australia, issued the TCO on 18 November 2005. This order applies item 50 of Schedule 4 to the Customs Tariff Act 1995, effectively setting the duty rate for these tyres to free, down from the general rate of 5%.
The Act imposes several obligations on parties and entities involved in the tariff concession process. For instance, the CEO must determine if the application meets the core criteria by ensuring no substitutable goods are produced in Australia on the day the application was lodged (section 269C). Additionally, the CEO is required to publish a notice in the Gazette inviting submissions on the application as soon as practicable after accepting it as valid (subsection 269K(1)). In this case, no submissions were received. The TCO itself takes effect from the date the application was lodged (subsection 269S(1)), meaning Independent Tyre Distributors’ order is effective from 02 September 2005.
The legislation also delineates specific consequences for non-compliance and breaches. Although the Explanatory Statement does not explicitly detail penalties for breach, general provisions within the Customs Act 1901 suggest potential administrative, civil, and criminal penalties. For example, providing false or misleading information in an application could result in fines or imprisonment, depending on the severity and intent of the offence. The TCO itself does not impose any liabilities on any person, and it preserves the rights of individuals as they stood before its registration (subsection 269S(2)).
Moreover, the Act ensures that the rights of importers are beneficially affected. Importers of the specified goods can apply for a refund of duty on goods imported since the TCO came into force, under paragraph 126(1)(r) of the Regulations. This provision underscores the Act’s intent to provide economic relief and competitive advantage to importers of specified goods, thereby encouraging trade and investment in the relevant sectors.