EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0513176
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.
Siemens Ltd applied for a TCO in respect of certain pallet magazines on 28 September 2005.
Instrument
TCO No 0513176 was made on 16 December 2005. It declares that those certain pallet magazines 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. 0513176 is taken to have come into force on 28 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. 0513176, enacted under the Customs Act 1901, was introduced to address the need for streamlined and efficient processes in tariff concession applications, particularly for the importation of goods that are not produced in Australia. The instrument was made by the Chief Executive Officer of Customs on 16 December 2005, following an application by Siemens Ltd for tariff concessions on certain pallet magazines. The legislation was enacted by the relevant legislature, aiming to facilitate trade by providing tariff concessions on goods not produced domestically, thus encouraging imports and potentially reducing costs for businesses. The Customs Act 1901, as amended, provides a framework for the application and assessment of tariff concessions, ensuring that the process is transparent and considers the views of stakeholders. The instrument does not disadvantage any person, except the Commonwealth, and does not impose any new liabilities, while potentially benefiting importers by allowing them to apply for a refund of duty on goods imported since the effective date of the concession.
Scope and Application
The Customs Act 1901, through its Part XVA, allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which provide for lower rates of customs duty on specified goods. This instrument applies to any person or entity seeking a reduction in customs duty for goods that are not produced in Australia in the ordinary course of business and for which there are no substitutable goods available domestically. The TCO scheme is applicable nationally, affecting all individuals and businesses engaged in the importation of goods within Australia. Any application for a TCO is subject to review, and the CEO must consider whether the goods in question meet the criteria for concession, specifically the absence of Australian production or substitutable goods. The Tariff Concession Instrument No. 0513176, made under this Act, specifically exempts certain pallet magazines from the general duty rate, thereby granting them a duty-free status. The instrument does not impose any liabilities or affect the rights of any person adversely, and any rights of importers are positively impacted as they may apply for a refund of duty on eligible goods imported since the commencement of the TCO. The application and effectiveness of this legislation may be further detailed or refined through subordinate instruments, which can provide additional guidelines or specific instances of application.
Key Provisions
The key provisions of Tariff Concession Instrument No. 0513176 under the Customs Act 1901 (the Act) pertain to the application and implementation of a Tariff Concession Order (TCO) for certain pallet magazines. Under section 269F (1) of the Act, any person can apply to the Chief Executive Officer of Customs (the CEO) for a TCO. If the application meets the core criteria, which include ensuring that no substitutable goods are produced in Australia in the ordinary course of business as outlined in section 269C, the CEO must make a written order (section 269P(3)). For the pallet magazines in question, this TCO was issued on 16 December 2005, applying item 50 of Schedule 4 to the Customs Tariff Act 1995, which set the duty rate at free, down from the general rate of 5%.
The Act imposes several obligations on the parties involved. The CEO is required to ensure that the application does not pertain to goods specified in section 269SJ of the Act and must decide whether the application meets the core criteria as defined in section 269C. Additionally, under subsection 269K(1) of the Act, the CEO must publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made. In this case, no submissions were received. The TCO itself is effective from the date the application was lodged, as stipulated in subsection 269S(1) of the Act.
The Act also stipulates consequences for breaches of its provisions. While the explanatory statement does not specify the exact penalties, under the Customs Act 1901, breaches can lead to both civil and criminal penalties. Civil penalties can include fines, while criminal penalties may include imprisonment, depending on the severity of the breach. However, the specific penalties are detailed in other sections of the Customs Act and the Crimes Act 1914. The TCO ensures that the rights of importers will be beneficially affected, allowing them to apply for a refund of duty on goods imported since the TCO's effective date, without imposing any new liabilities on any person.