EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0511965
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.
Stockwell International applied for a TCO in respect of certain expanded grid battery plate lines on 8 September 2005.
Instrument
TCO No 0511965 was made on 25 November 2005. It declares that those certain expanded grid battery plate lines 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.0511965 is taken to have come into force on 8 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, provides a framework for the regulation of customs and excise duties. The Tariff Concession Instrument No. 0511965, made under the authority of this Act, addresses the problem of ensuring that Australian industries can compete effectively in the global market by granting tariff concessions on certain goods. This particular instrument, made on 25 November 2005, was introduced to provide tariff relief on certain expanded grid battery plate lines, which were found not to have substitutable goods produced in Australia, thereby meeting the core criteria stipulated under the Customs Act 1901. The instrument aims to reduce the customs duty rate from the general rate of 5% to free, thereby benefiting importers and fostering competitiveness within the industry.
Scope and Application
The Customs Act 1901, specifically under Part XVA, establishes a framework through which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs (CEO) to provide a lower rate of customs duty on specified goods. This legislation applies to any person or entity that seeks to import goods eligible for a tariff concession, provided the goods are not those specified in section 269SJ of the Act which excludes certain items from eligibility. The process involves an application to the CEO, who must determine if the application meets core criteria, notably if no substitutable goods are produced in Australia in the ordinary course of business as defined by the Act. The geographic scope of this Act is national, with its application extending across the Commonwealth of Australia. The Act does not impose any new liabilities on persons other than the Commonwealth and protects the rights of such persons as of the date of registration. Subordinate instruments may further extend or refine the application of the Act, although no such instruments are indicated in this particular TCO.
Key Provisions
The Customs Act 1901, particularly under Part XVA, governs the process for Tariff Concession Orders (TCOs), as explained in Tariff Concession Instrument No. 0511965. Section 269F allows for an application to be made by any person to the Chief Executive Officer (CEO) of Customs for a TCO concerning certain goods. For an application to be considered, it must not be in respect of goods specified in section 269SJ, which are ineligible for TCOs. The CEO must then assess whether the application meets the core criteria outlined in section 269C. According to this section, the application meets the core criteria if, on the date the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Definitions of key terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods' are provided in sections 269D, 269E, and 269B respectively.
Entities and individuals subject to the Act must ensure that their applications for TCOs are compliant with the core criteria. This involves verifying that no substitutable goods were produced in Australia on the date of application. In the case of Stockwell International’s application for certain expanded grid battery plate lines, the CEO confirmed that no substitutable goods were produced domestically, leading to the issuance of TCO No. 0511965. This order specifies that the goods in question are subject to the prescribed item in Schedule 4 of the Customs Tariff Act 1995, with a reduced duty rate of free, down from the general rate of 5%. The process also involves publishing a notice in the Gazette inviting submissions from interested parties, although in this instance, no submissions were received.
Failure to comply with the requirements set forth in the Customs Act 1901 can lead to various consequences. While the explanatory statement does not detail specific civil or criminal penalties for breaches, the general framework of the Act implies that non-compliance could result in the imposition of fines or other penalties as prescribed by law. Such penalties may vary depending on the severity and intent behind the breach. The TCO itself does not disadvantage any person or impose liabilities in respect of actions taken before its registration, ensuring that only future transactions are affected by its terms.