EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0608186
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.
J. W. Ross & Sons applied for a TCO in respect of certain oiless compressors on 11 May 2006.
Instrument
TCO No 0608186 was made on 28 July 2006. It declares that those certain oiless compressors 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. 0608186 is taken to have come into force on 11 May 2006.
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. 0608186 was enacted in 2006 under the Customs Act 1901. This legislative instrument addresses the need to provide tariff concessions for specific goods, thereby reducing the customs duty rates for these goods. The Customs Act 1901 establishes the framework for Tariff Concession Orders (TCOs), which the Chief Executive Officer of Customs can issue to grant lower rates of customs duty for certain goods. The instrument was introduced to provide a streamlined process for granting tariff concessions, ensuring that applications are assessed based on the criteria outlined in the Act, particularly focusing on whether substitutable goods are produced in Australia. The objective is to facilitate the importation of goods that are not locally produced, thereby supporting trade and economic activities.
The Tariff Concession Instrument No. 0608186 was made in response to an application by J. W. Ross & Sons for certain oil-less compressors, which were granted a tariff concession due to the absence of substitutable goods produced in Australia. The instrument came into effect on the date the application was lodged, 11 May 2006. The instrument aims to benefit importers by allowing them to apply for a refund of duty on goods imported since the concession was effective, without imposing any liabilities on them. The process involved publishing a notice in the Gazette to invite submissions, though none were received, leading to the issuance of the TCO.
Scope and Application
The Tariff Concession Instrument No. 0608186 applies to the customs duty rate on certain oilless compressors, as specified in the Customs Act 1901. This legislation applies to entities and individuals who import or intend to import these particular goods into Australia. The instrument pertains to the customs duty concessions under the Customs Act, specifically targeting the application of lower rates of duty on specified goods through Tariff Concession Orders (TCOs). This Act operates at the national level, under the jurisdiction of the Commonwealth, and applies across Australia. Any person may apply for a TCO, provided that the goods in question are not specified in section 269SJ of the Act, which outlines those goods that cannot be subject to a TCO. The Act does not provide specific exclusions or exemptions beyond those mentioned, and it allows for further application or restriction through subordinate instruments. The TCO in question was made effective from the date the application was lodged, ensuring that importers can benefit from the lower duty rate without incurring any new liabilities.
Key Provisions
The main operative sections of the Customs Act 1901 in relation to Tariff Concession Orders (TCOs) are sections 269C, 269B, 269D, 269E, 269F, 269P, 269S, and 269SJ. Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO. If the CEO is satisfied that the application is valid and meets the core criteria outlined in sections 269C and 269B, the CEO must make a written order declaring the goods subject to a lower rate of customs duty. This process is further defined by sections 269D, 269E, and 269P, which respectively outline the meanings of "goods produced in Australia", "ordinary course of business", and "substitutable goods".
Under the Customs Act 1901, the CEO has specific obligations when considering an application for a TCO. Upon receiving a valid TCO application, the CEO must ensure that the application meets the core criteria, particularly verifying that no substitutable goods are produced in Australia at the time of application (section 269C). If the criteria are met, the CEO must publish a notice in the Gazette inviting any person to submit objections to the TCO, as per section 269K. If no objections are received, the CEO must proceed to issue the TCO as per section 269P. Additionally, the CEO must ensure that the TCO does not adversely affect the rights of any person other than the Commonwealth and does not impose any new liabilities on individuals or entities (section 269S).
The Customs Act 1901 and the associated regulations impose various consequences for breaches related to TCOs. While the explanatory statement does not detail specific offences or penalties, it is reasonable to infer that any misuse of a TCO or fraudulent claims could result in legal action. Given the context of the Customs Act, such actions could potentially include fines or imprisonment as stipulated under the relevant sections of the Act. The Act's regulatory framework is designed to ensure compliance and maintain the integrity of the tariff concession process.