EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0511535
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.
W W Wedderburn Pty Ltd applied for a TCO in respect of certain scale load receptors on 02 September 2005.
Instrument
TCO No 0511535 was made on 25 November 2005. It declares that those certain scale load receptors 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. 0511535 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 Customs Act 1901, enacted by the Australian Parliament, establishes a framework for the imposition and regulation of customs duties. The Act allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which can reduce the customs duty on specific goods. The Tariff Concession Instrument No. 0511535 was introduced to provide a lower customs duty rate on certain scale load receptors, as applied by W W Wedderburn Pty Ltd, effective from 2 September 2005. The legislation aims to ensure that these goods, which are not produced domestically, receive a concessional tariff treatment without imposing any disadvantages or liabilities on third parties. The instrument was published in the Gazette with an invitation for submissions, though none were received, and it does not affect any existing rights or impose new liabilities on non-Commonwealth entities.
Scope and Application
The Tariff Concession Instrument No. 0511535 is an instrument made under Part XVA of the Customs Act 1901, which governs the process for granting tariff concession orders (TCOs). This particular instrument applies to certain scale load receptors, granting them a free rate of customs duty instead of the general rate of 5%. The instrument is relevant to persons or entities that are importing these specific goods into Australia. The application of this TCO is national in scope, as it is made under the Commonwealth legislation of the Customs Act 1901, affecting customs duty rates across the country. The TCO does not apply to goods specified in section 269SJ of the Act, which outlines goods that cannot be subject to a TCO. The instrument also specifies that it does not disadvantage any person or impose liabilities for actions taken before the date of registration. This instrument extends the application of the Customs Act 1901 by providing a mechanism for the Chief Executive Officer of Customs to reduce the rate of customs duty on certain imported goods, subject to certain conditions and criteria being met.
Key Provisions
The Customs Act 1901 (the Act), through its section 269F (1), allows any person to apply to the Chief Executive Officer of Customs (the CEO) for a Tariff Concession Order (TCO) in respect of goods. If the CEO is satisfied that the application pertains to goods not specified in section 269SJ of the Act, which outlines goods ineligible for a TCO, they must then determine if the application meets the core criteria set out in section 269C of the Act. A TCO application meets these criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business (section 269C). If the CEO determines that the application satisfies these criteria, they must make a written order (a TCO) that specifies the goods subject to the concession (section 269P(3)).
The obligations imposed on the parties or entities governed by this legislation are primarily on the CEO of Customs. When a TCO application is received, the CEO must ensure that the application does not pertain to goods listed in section 269SJ of the Act and must verify that the core criteria outlined in section 269C are met. This involves confirming that no substitutable goods were produced in Australia in the ordinary course of business on the date the application was lodged. Once these criteria are met, the CEO must publish a notice in the Gazette inviting any interested parties to lodge a submission if they believe there are reasons why the TCO should not be made (subsection 269K(1) of the Act). If no submissions are received, the CEO must then proceed to make the TCO.
Breaching the obligations outlined in the Customs Act 1901 can lead to several consequences. Firstly, if a TCO is made erroneously without meeting the core criteria, it could result in an incorrect rate of duty being applied to the goods. This could lead to financial repercussions for both the government and the importers. While the Act does not explicitly outline offences or penalties for breaching the core criteria, it does specify the process for making a TCO. Failure to adhere to this process could lead to legal challenges or administrative penalties. Additionally, if a TCO is found to have been incorrectly applied, there could be civil or criminal consequences for the party responsible for the error, although the specific penalties are not detailed within the Act itself.