EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0608232
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 cone crushers on 10 May 2006.
Instrument
TCO No 0608232 was made on 7 October 2006. It declares that those certain cone crushers 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 0%.
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. One submission objecting to the TCO application was received from Abon Engineering Pty Ltd.
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. 0608232 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 Customs Act 1901, enacted by the Commonwealth Parliament, provides a framework for the administration of customs duties in Australia. Among its provisions, Part XVA introduces a scheme for Tariff Concession Orders (TCOs), which allow the Chief Executive Officer of Customs to apply reduced customs duties on certain imported goods. This mechanism was designed to address the problem of ensuring that Australian industries do not face undue competition from locally produced goods by providing tariff relief under specific circumstances. The objective of the scheme, as articulated in the Act, is to ensure that when a TCO application is made, it is only approved if there are no substitutable goods produced in Australia in the ordinary course of business. Tariff Concession Instrument No. 0608232, made on 7 October 2006, is an example of this process in action, granting a zero percent duty rate on certain cone crushers, subject to the conditions set out in the Act.
Scope and Application
The Customs Act 1901, specifically Part XVA, facilitates the implementation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This legislation applies to individuals or entities seeking to import goods that are eligible for a concession on customs duty. The scope of the Act extends to any goods that are not explicitly excluded under section 269SJ and where no substitutable goods are produced in Australia. The eligibility for a TCO hinges on the absence of domestically produced goods that serve a similar purpose as the imported goods, as defined by sections 269C, 269D, 269E, and 269F of the Act. The geographic reach of this Act is national, impacting importers across Australia. TCOs are subject to consultation, requiring the CEO to publish notices in the Gazette inviting submissions from interested parties. The commencement of a TCO, such as Instrument TCO No. 0608232 for certain cone crushers, is effective from the date the application is lodged, though it does not retroactively disadvantage any party or impose liabilities for actions taken prior to the registration date.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0608232 (Instrument) under the Customs Act 1901 (Act) include sections 269C, 269B, 269D, 269E, 269F, 269K, 269P, 269S, and 269SJ. These sections establish the framework for the making of Tariff Concession Orders (TCO) by the Chief Executive Officer (CEO) of Customs. Specifically, section 269F allows a person to apply to the CEO for a TCO for certain goods, while section 269C sets out the core criteria that the CEO must satisfy to approve an application. The core criteria include ensuring that no substitutable goods are produced in Australia on the day the application was lodged (section 269C). If the CEO is satisfied with the application, they must make a written order declaring the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies (section 269P(3)). The CEO is also required to publish a notice in the Gazette inviting submissions from any person who may object to the TCO (section 269K). The TCO takes effect from the date the application was lodged (section 269S).
The obligations imposed on parties by this Act include the requirement for applicants to ensure their applications meet the core criteria specified in section 269C. This involves demonstrating that no substitutable goods are being produced in Australia on the date of the application. Additionally, the CEO has the obligation to consider any submissions received in response to the notice published in the Gazette and to make a decision on whether to approve the TCO based on the information and criteria provided by the Act. The CEO must also ensure that the TCO does not disadvantage any person other than the Commonwealth and does not impose any liabilities in respect of actions taken before the date of registration.
There are no explicit offences, penalties, or civil/criminal consequences for breach outlined in this particular Instrument. However, breaches of the Customs Act 1901 or related regulations could potentially result in civil or criminal penalties. The Customs Act includes provisions for penalties for offences such as making false statements, evading duty, and smuggling. For example, section 228 of the Act outlines various penalties, including fines and imprisonment, for offences against the Act. The exact penalties would depend on the nature and severity of the breach, and would be governed by the broader provisions of the Customs Act and associated regulations.