EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0516756
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.
Wilkinson Family Trust T/A Australian Dust Control applied for a TCO in respect of certain dust extraction systems on 06 December 2005.
Instrument
TCO No 0516756 was made on 03 March 2006. It declares that those certain dust extraction systems 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. 0516756 is taken to have come into force on 06 December 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. 0516756, enacted in 2006, addresses the need for tariff concessions on specific goods under the Customs Act 1901. This legislation enables the Chief Executive Officer of Customs to grant lower customs duty rates on certain goods when it is determined that no suitable substitute products are produced in Australia. The policy objective of this instrument is to facilitate trade and economic efficiency by reducing the cost of importing these goods, thereby encouraging their availability and use in the Australian market. This instrument was introduced following an application by Wilkinson Family Trust T/A Australian Dust Control, which sought tariff concessions on specific dust extraction systems. The Australian Parliament enacted this measure to ensure that such tariff concessions can be granted in a manner that aligns with the broader goals of the Customs Act.
Scope and Application
The Customs Act 1901, as supplemented by Tariff Concession Instrument No. 0516756, pertains to the tariff concession process for certain goods, specifically dust extraction systems in this case. The Act applies to entities or individuals who wish to import goods that may qualify for a reduced customs duty under a Tariff Concession Order (TCO). The application process involves the Chief Executive Officer of Customs (CEO) who assesses whether the application meets the core criteria, which requires that no substitutable goods are produced in Australia. The geographic scope of this Act is national, as it applies across all jurisdictions within Australia. Notably, the Act does not impose any liabilities on persons other than the Commonwealth, and it does not affect pre-existing rights adversely. The TCO, once issued, allows for a refund of duty for importers of the specified goods from the date the TCO is deemed to have come into force. Any exclusions or limitations on the application of the TCO are detailed within the instrument itself and may be further refined through subordinate legislation if necessary.
Key Provisions
The Tariff Concession Instrument No. 0516756, under the Customs Act 1901, provides a mechanism for the Chief Executive Officer of Customs (CEO) to issue Tariff Concession Orders (TCOs) (s 269F). The primary operative section, section 269C, stipulates that a TCO application is valid if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. This definition is further clarified in sections 269D, 269E, and 269P(3) of the Act. If the CEO is satisfied that the application meets the core criteria, they must issue a TCO, as mandated by section 269P(3). The instrument, TCO No. 0516756, made on 03 March 2006, applies to certain dust extraction systems, declaring them to be subject to item 50 of Schedule 4 of the Customs Tariff Act 1995, with a duty rate of free instead of the general rate of 5%.
The Customs Act imposes several obligations on the parties involved. The CEO must ensure that the TCO application is valid by confirming that no substitutable goods were produced in Australia on the application date (s 269C). The CEO must also publish a notice in the Gazette inviting any interested parties to submit reasons why the TCO should not be made (s 269K(1)). This publication requirement is a crucial part of the process to ensure transparency and allow stakeholders to voice any concerns. If no submissions are received, the CEO can proceed to issue the TCO.
Failure to comply with the provisions of the Customs Act can lead to significant consequences. While the explanatory statement does not detail specific offences or penalties, the Act generally provides for civil and criminal penalties for breaches. Civil penalties can include fines, and criminal penalties can include imprisonment, depending on the severity of the breach and the relevant sections of the Act. The precise penalties would need to be determined in the context of specific breaches, but they could be substantial, reflecting the importance of adhering to the tariff concession scheme. The explanatory statement confirms that the TCO does not impose any liabilities on any person and that the rights of importers will be beneficially affected, allowing them to apply for a refund of duty on goods imported since the TCO was taken to have come into force.