EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0608226
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.
OneSteel Manufacturing Pty Ltd applied for a TCO in respect of certain radial stackers on 10 May 2006.
Instrument
TCO No 0608226 was made on 21 July 2006. It declares that those certain radial stackers 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. 0608226 is taken to have come into force on 10 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. 0608226, enacted under the Customs Act 1901, addresses the need for tariff concessions for specific goods that are not produced domestically in the ordinary course of business. This legislation was introduced to ensure that Australian businesses can compete effectively in the market by providing them with access to imported goods at a lower duty rate when no suitable domestic alternatives exist. Enacted by the relevant legislature, the objective is to facilitate trade by reducing the cost burden of customs duties on businesses, thereby promoting economic efficiency and competitive balance in the Australian market. The instrument came into force on the date of the application, 10 May 2006, and does not affect the rights of any person other than the Commonwealth or impose liabilities on any person for actions taken before the instrument's registration.
Scope and Application
The Tariff Concession Instrument No. 0608226, issued under the Customs Act 1901, pertains specifically to the granting of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This legislation applies to individuals or entities that wish to import goods subject to a TCO, whereby a lower rate of customs duty is applicable. The scope of this legislation is national, extending across Australia as it operates under the Commonwealth’s purview. The Act applies to any goods for which a TCO is sought, provided they do not fall under the prohibited categories outlined in section 269SJ. Notably, the instrument does not disadvantage any person by affecting their rights as they stood prior to the TCO's registration, nor does it impose any new liabilities. The instrument came into effect on the date of the application for the TCO, in this case, 10 May 2006. Any exclusions or exemptions are determined by the specific criteria outlined in the Customs Act 1901, and the application of the Act can be extended or restricted through subordinate instruments as necessary.
Key Provisions
The main operative sections of this legislation include section 269F, which allows an individual or entity to apply for a Tariff Concession Order (TCO) from the Chief Executive Officer of Customs (CEO). If the application meets the core criteria outlined in section 269C, the CEO must make a TCO, declaring that the goods specified in the application are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. The TCO then applies to these goods from the date the application was lodged, as per subsection 269S(1). In this particular instance, TCO No. 0608226 was made on 21 July 2006 for certain radial stackers, declaring that these goods are subject to a zero rate of duty.
The Act imposes specific obligations on the CEO in processing TCO applications. Firstly, the CEO must ensure that the application is not for goods listed in section 269SJ, which are ineligible for a TCO. If the CEO is satisfied that the application meets the core criteria and no substitutable goods were produced in Australia on the application date, the CEO must make a TCO as per section 269P(3). Additionally, the CEO is required to publish a notice in the Gazette inviting submissions from any interested parties regarding the proposed TCO, as per subsection 269K(1). If no submissions are received, the CEO proceeds with the TCO.
Failure to comply with the requirements of the Customs Act 1901 can lead to various legal consequences. While the Act does not explicitly state penalties for non-compliance with the TCO process, breaches of other provisions in the Act may result in civil or criminal penalties. For example, under section 250 of the Customs Act 1901, the maximum penalty for knowingly making a false statement or document is $11,000 or imprisonment for five years, or both. For failing to comply with a requirement to provide information, the maximum penalty is $5,500 or imprisonment for two years, or both. Importers or entities who do not adhere to the terms of their TCO or engage in fraudulent activities may face further penalties or legal action.
The Tariff Concession Order No. 0608226, declared on 21 July 2006, is effective from 10 May 2006, the date the application was lodged. The TCO does not affect the rights of any person except the Commonwealth, ensuring that no one is disadvantaged or imposed liabilities for actions taken before the registration date. Importers of the specified goods can apply for a refund of duty under paragraph 126(1)(r) of the Regulations, benefiting from the zero rate of duty on these goods. This particular TCO aims to provide tariff relief on certain radial stackers, facilitating trade and reducing costs for importers.