EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0516783
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.
Jondod Pty Ltd applied for a TCO in respect of certain tree chipper on 9 December 2005.
Instrument
TCO No 0516783 was made on 03 March 2006. It declares that those certain tree chipper 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. 0516783 is taken to have come into force on 9 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 Customs Act 1901, enacted by the Parliament of Australia, serves to regulate the importation of goods into Australia, including the imposition of customs duties. The Act allows for the creation of Tariff Concession Orders (TCOs) which provide a lower rate of customs duty for certain goods, thereby addressing the issue of potentially high customs duties on specific items. The Tariff Concession Instrument No. 0516783, made under the Customs Act, pertains to a TCO application by Jondod Pty Ltd for certain tree chippers. The instrument was enacted on 3 March 2006 and declares that these tree chippers are subject to a free rate of duty, as no substitutable goods were produced in Australia on the application date. The primary objective of this TCO is to provide tariff relief to importers, thereby encouraging the import of these goods and potentially benefiting consumers by lowering the cost of such imported items.
Scope and Application
The Tariff Concession Instrument No. 0516783 applies to goods, specifically certain tree chippers, and is enacted under Part XVA of the Customs Act 1901. The Act allows for Tariff Concession Orders (TCOs) which reduce the rate of customs duty on specified goods if certain criteria are met. This particular TCO applies to Jondod Pty Ltd’s application for a tariff concession on certain tree chippers, effective from 9 December 2005, the date the application was lodged. The geographic and jurisdictional reach of this legislation is national, as it is governed by the Commonwealth of Australia under the Customs Act 1901. The exclusions specified in section 269SJ of the Act prevent certain goods from being eligible for TCOs, but no such exclusions were applicable in this case. The instrument does not disadvantage any person other than the Commonwealth and does not impose liabilities on anyone, with the specific benefit being available to importers who can apply for a refund of duty on goods imported since the effective date of the TCO.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0516783 under the Customs Act 1901 (section 269F) allow for the application to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of specific goods. If the CEO determines that the application meets the core criteria (section 269C), they must make a written order, which is the TCO, declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (section 269P(3)). This TCO No. 0516783 was made on 03 March 2006 and declares that certain tree chippers are subject to the TCO, thereby applying a duty rate of free instead of the general rate of 5%.
The obligations imposed by this Act on the parties it governs include the requirement for a person to apply to the CEO for a TCO if they wish to benefit from a lower rate of customs duty (section 269F). The CEO must then decide whether the application meets the core criteria, which include ensuring that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (section 269C). The CEO is also required to publish a notice in the Gazette inviting submissions from any person who considers that there are reasons why the TCO should not be made (subsection 269K(1)). In this case, the CEO did not receive any submissions in response to this invitation.
Any breach of the obligations set out in the Act could lead to civil or criminal consequences. While the explanatory statement does not detail specific offences or penalties, it is understood that the Act provides for enforcement mechanisms to ensure compliance with its provisions. The TCO itself does not affect the rights of any person other than the Commonwealth, and it does not impose any liabilities on any person in respect of anything done or omitted to be done before the date of registration. This ensures that the rights of importers are beneficially affected, and they can apply for a refund of duty on goods imported since the TCO is taken to have come into force (paragraph 126(1)(r) of the Regulations).