EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0511816
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.
Parchem Construction Products Pty Ltd applied for a TCO in respect of certain mixers on 06 September 2005.
Instrument
TCO No 0511816 was made on 25 November 2005. It declares that those mixers 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. 0511816 is taken to have come into force on 06 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 was amended to introduce Tariff Concession Orders (TCOs), a mechanism through which certain goods may be subject to a lower rate of customs duty. This change was enacted to address the need for flexibility in tariff rates to support economic competitiveness and to encourage local production where feasible. The Tariff Concession Instrument No. 0511816, enacted in 2005, provides for a specific application of this scheme. This instrument was introduced by the Chief Executive Officer of Customs in response to an application from Parchem Construction Products Pty Ltd for a TCO on certain mixers. The instrument was made on 25 November 2005, declaring that the mixers are subject to a free rate of duty under item 50 of Schedule 4 to the Customs Tariff Act 1995, given that no substitutable goods were being produced in Australia at the time of application. The policy objective of this legislation is to ensure that TCOs are granted only when there are no locally produced alternatives, thereby protecting local industries while allowing for tariff relief in appropriate circumstances.
Scope and Application
The Tariff Concession Order No. 0511816 under the Customs Act 1901 applies to goods specified in the order, namely certain mixers, and pertains to the application of a lower rate of customs duty as outlined in the order. This Act allows the Chief Executive Officer of Customs to make Tariff Concession Orders, provided that the goods in question do not fall under the prohibited category specified in section 269SJ of the Act, and that no substitutable goods are produced in Australia in the ordinary course of business as per section 269C. The application by Parchem Construction Products Pty Ltd was processed and accepted based on these criteria, leading to the issuance of the Tariff Concession Order on 25 November 2005. The geographic and jurisdictional reach of this legislation is national, governed under the Commonwealth of Australia. There are no exclusions or exemptions noted in the order itself, but the Act allows for subordinate instruments to extend or restrict its application further. The commencement date of the order aligns with the date the application was lodged, 6 September 2005, and it does not adversely affect any pre-existing rights or impose new liabilities on parties other than the Commonwealth.
Key Provisions
The Tariff Concession Order (TCO) No. 0511816, made under section 269P(3) of the Customs Act 1901 (the Act), applies to certain mixers. Section 269P(3) requires the Chief Executive Officer of Customs (the CEO) to make a written order if satisfied that a TCO application meets the core criteria outlined in section 269C of the Act. This particular TCO declares that the specified mixers are subject to item 50 of Schedule 4 of the Customs Tariff Act 1995 (the Tariff) and thus are exempt from the general duty rate of 5%, instead being subject to a duty rate of free.
The obligations imposed on the parties governed by this Act include the requirement for applicants to ensure that their applications meet the core criteria, which involves proving that no substitutable goods are produced in Australia. Section 269C requires the CEO to satisfy themselves that, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. The CEO also has a duty to publish a notice in the Gazette inviting submissions from any interested parties who might oppose the making of the TCO, as required by section 269K(1) of the Act.
There are no specified offences, penalties, or civil/criminal consequences for breach of the provisions of the Tariff Concession Order No. 0511816 as per the explanatory statement. However, the Customs Act 1901 and related legislation provide for a range of penalties and consequences for non-compliance with customs and tariff regulations. These include fines and imprisonment for offences such as providing false or misleading information, engaging in fraudulent activities, and failing to comply with customs and excise laws. The specific penalties can vary depending on the nature and severity of the breach.
Overall, the Tariff Concession Order No. 0511816 facilitates the importation of certain mixers without incurring the usual customs duty, provided the application process and criteria are correctly followed. It also outlines the obligations of the CEO in processing applications and the rights of interested parties to object to the making of a TCO. While no specific penalties are mentioned for this TCO, general provisions of the Customs Act 1901 apply for non-compliance with customs regulations.