EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0514830
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.
Linak Australia Pty Ltd applied for a TCO in respect of certain linear actuator position controller switches on 24 October 2005.
Instrument
TCO No 0514830 was made on 23 January 2006. It declares that those certain linear actuator position controller switches 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. 0514830 is taken to have come into force on 24 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 Tariff Concession Instrument No. 0514830 was enacted under the Customs Act 1901 in 2006, aiming to address the need for tariff concessions on certain goods imported into Australia. The instrument was introduced to facilitate trade by providing a lower rate of customs duty on specific goods, in this case, linear actuator position controller switches, which are integral for various industrial applications. The Customs Act 1901 allows the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) if certain criteria are met, primarily that no substitutable goods are produced in Australia. In this instance, Linak Australia Pty Ltd applied for the concession, and the CEO determined that no such Australian-produced goods existed, thereby approving the tariff reduction. The policy objective is to enhance the competitiveness of Australian industries by reducing the cost of imported goods necessary for their operations.
Scope and Application
The Tariff Concession Instrument No. 0514830, made under the Customs Act 1901, applies to specific linear actuator position controller switches, as detailed in the instrument. This legislation aims to provide a lower rate of customs duty on these goods, contingent on the Chief Executive Officer of Customs determining that no substitutable goods are produced in Australia. This instrument is applicable to any person or entity importing these particular goods into Australia, and it is effective across the entire Commonwealth of Australia. It is important to note that the application of this instrument is subject to certain exclusions, specifically those goods outlined in section 269SJ of the Customs Act 1901, which cannot be subject to a Tariff Concession Order (TCO). Furthermore, the CEO must ensure that the application meets the core criteria set out in sections 269C, 269D, and 269E of the Act, including the absence of substitutable goods produced in Australia in the ordinary course of business. The instrument does not disadvantage any person's rights as they stood at the date of registration nor impose any new liabilities.
Key Provisions
The primary sections of this legislation, Tariff Concession Instrument No. 0514830, focus on the application process for Tariff Concession Orders (TCOs) under the Customs Act 1901 (section 269F). The CEO of Customs is mandated to make a written order if the application meets the core criteria, which include the condition that no substitutable goods are produced in Australia on the day the application was lodged (section 269C). The instrument specifies that certain linear actuator position controller switches are subject to a free rate of duty, as opposed to the general rate of 5% (section 50 of Schedule 4 to the Customs Tariff Act 1995). Furthermore, the TCO comes into effect on the day the application was lodged (section 269S(1)), in this case, 24 October 2005.
The obligations imposed by the Customs Act 1901 on parties applying for a TCO include ensuring that the application is not in respect of goods specified in section 269SJ, which excludes certain goods from eligibility for a TCO. The CEO must also verify that no substitutable goods are produced in Australia, as defined in section 269D, to satisfy the core criteria. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any interested parties and must consider these submissions when deciding whether to grant the TCO. Failure to adhere to these obligations may result in the CEO not making the TCO as required by the Act.
In terms of consequences for non-compliance or breach of the provisions outlined in the Customs Act 1901, specific offences, penalties, or consequences are not detailed in the provided text. However, it is implied that the CEO has the authority to enforce the Act's provisions, and any breach may result in legal action against the offending party. The Act itself does not specify maximum penalties for breaches, but penalties could be determined under other relevant sections of the Customs Act 1901 or other applicable laws. It is also worth noting that the TCO does not affect the rights of any person other than the Commonwealth, nor does it impose any liabilities on any person (section 269S(1)).