EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0513495
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.
Laserlite Australia Pty Ltd applied for a TCO in respect of certain Flat and Profiled Sheets Extrusion Line on 5 October 2005.
Instrument
TCO No 0513495 was made on 3 January 2006. It declares that those certain Flat and Profiled Sheets Extrusion Line 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 0%.
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. 0513495 is taken to have come into force on 5 October 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 enacted by the Parliament of Australia and establishes a framework for the imposition of customs duty on imported goods, among other provisions. Specifically, Part XVA of the Act provides for Tariff Concession Orders (TCOs) which can lower the customs duty rate on certain imported goods. This legislative measure was introduced to address gaps in tariff concessions, ensuring that industries can benefit from tariff reductions where appropriate. The policy objective is to provide relief to industries by reducing the duty on goods that cannot be substituted by Australian-produced goods. In this context, TCO No. 0513495 was made on 3 January 2006, in response to an application by Laserlite Australia Pty Ltd concerning certain Flat and Profiled Sheets Extrusion Line. The CEO determined that no substitutable goods were produced in Australia, thus satisfying the core criteria for a concession, and set the duty rate at 0% instead of the general rate of 5%. The TCO came into force on the date the application was lodged, 5 October 2005, without imposing any new liabilities and allowing for duty refunds for importers of these goods from that date.
Scope and Application
The Tariff Concession Instrument No. 0513495, which is a part of the Customs Act 1901, applies to specific goods, namely certain Flat and Profiled Sheets Extrusion Lines, as determined by the Chief Executive Officer (CEO) of Customs. This instrument facilitates tariff concessions for these goods, effectively reducing the customs duty rate from 5% to 0% as per the conditions stipulated in the instrument. The concession applies to entities that import these goods into Australia, providing them with a financial advantage by lowering their customs duty burden. The instrument operates under federal jurisdiction, impacting the national customs regime. Importantly, the instrument does not apply to goods specified in section 269SJ of the Customs Act 1901, which are explicitly excluded from tariff concessions. The CEO must ensure that the application for a tariff concession order meets the core criteria set out in the Act, specifically that no substitutable goods are produced in Australia in the ordinary course of business. The instrument took effect on the date the application was lodged, 5 October 2005, and it does not retroactively affect any rights or impose liabilities on persons other than the Commonwealth concerning actions taken prior to its registration.
Key Provisions
The main sections of the Tariff Concession Instrument No. 0513495, pursuant to the Customs Act 1901, establish the process for applying for and granting Tariff Concession Orders (TCOs) for specific goods. Section 269F of the Act allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO, provided the goods do not fall under the exclusions specified in section 269SJ. The CEO must then determine if the application meets the core criteria set out in section 269C, which requires that, on the date the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. If the application meets these criteria, the CEO is mandated under section 269P(3) of the Act to issue a written order, declaring that the goods in question are subject to a prescribed rate of duty specified in the Customs Tariff Act 1995.
The obligations imposed by this Act on the parties involved, particularly the applicant and the CEO, include ensuring that the application for a TCO is complete and meets all stipulated criteria. The applicant must provide all necessary information and evidence to demonstrate that no substitutable goods were produced in Australia at the time of application. The CEO has the duty to carefully review the application and, if satisfied that it meets the core criteria, to promptly issue the TCO. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any interested parties, as required by subsection 269K(1) of the Act. Failure to adhere to these obligations could result in the application being rejected or the TCO not being granted.
Breaching the provisions of the Customs Act 1901 or the Tariff Concession Instrument No. 0513495 can lead to various consequences. For instance, providing false information in an application for a TCO could result in administrative penalties or legal action. The Act does not specify maximum penalties for breaches related to TCOs, but general contraventions of the Customs Act can lead to significant fines and potential imprisonment. Additionally, any failure to comply with the requirements for issuing TCOs could result in the CEO facing administrative scrutiny or legal challenges from affected parties. It is crucial for all parties to adhere strictly to the legislative requirements to avoid these potential consequences.