EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0609331
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.
Road System Pty Ltd applied for a TCO in respect of certain self propelled litter collectors on 30 May 2006.
Instrument
TCO No 0609331 was made on 11 August 2006. It declares that those certain self propelled litter collectors 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. 0609331 is taken to have come into force on 30 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 Parliament of Australia, includes provisions for Tariff Concession Orders (TCOs) under Part XVA, which aim to facilitate the importation of certain goods by applying a reduced rate of customs duty. This legislative framework was introduced to address the issue of ensuring competitive pricing for imported goods while preventing the local production of similar items, thereby promoting fair trade practices. The instrument F2006L02698, specifically TCO No. 0609331, was enacted on 11 August 2006 following an application by Road System Pty Ltd for tariff concessions on self-propelled litter collectors. The policy objective, as per the Act, is to provide tariff relief on goods for which no substitutable products are produced domestically, thereby encouraging the importation of innovative or superior quality goods that are not currently manufactured in Australia.
Scope and Application
The Tariff Concession Instrument No. 0609331, made under the Customs Act 1901, applies to certain self-propelled litter collectors, as designated by the instrument. The instrument was made in response to an application by Road System Pty Ltd, and it provides a concession on the customs duty applicable to these goods. Specifically, the instrument declares that these goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, resulting in a duty rate of free, whereas the general rate of duty is 5%. This concession applies to goods that are not substitutable with those produced in Australia, as determined by the Chief Executive Officer of Customs (CEO) following the application of section 269C of the Act. The instrument was published in the Gazette to allow for public submissions, none of which were received. The concession takes effect from the date the application was lodged, which is 30 May 2006, and it does not affect the rights of any person other than the Commonwealth or impose any new liabilities. Importers, however, may benefit from the concession by applying for a refund of duty paid on these goods since the effective date of the concession.
Key Provisions
The Tariff Concession Instrument No. 0609331, made under section 269F of the Customs Act 1901 (section 269F), allows for a lower rate of customs duty on certain self-propelled litter collectors, as declared in item 50 of Schedule 4 to the Customs Tariff Act 1995. The general rate of duty for these goods is 5%, but under this Instrument, the rate of duty is reduced to free (section 269P(3)). This Instrument was made following an application by Road System Pty Ltd on 30 May 2006, and it came into force on the same date (sections 269S(1) and 269SJ). The Chief Executive Officer of Customs (CEO) was satisfied that no substitutable goods were produced in Australia, as per section 269C of the Act.
Under the Customs Act 1901, the CEO must ensure that applications for Tariff Concession Orders (TCO) meet specific criteria, including the absence of substitutable goods produced in Australia (section 269C). The CEO must also publish a notice in the Gazette inviting submissions from any person who believes the TCO should not proceed (subsection 269K(1)). In this case, no submissions were received. Furthermore, the Act requires that a TCO must not disadvantage any person other than the Commonwealth or impose liabilities on them for actions taken prior to the TCO's registration (subsection 269S(1)). This TCO benefits importers by allowing them to apply for a refund of duty on goods imported since the TCO's effective date (paragraph 126(1)(r) of the Regulations).
Failure to comply with the requirements of the Customs Act 1901 can result in various consequences. Offences under the Act may include providing false or misleading information in an application for a TCO, which can lead to fines or imprisonment (subsection 269M(1)). The maximum penalty for such offences is significant, reflecting the seriousness of contravening the legislative framework. Additionally, any person found to have breached the terms of a TCO may face further penalties, including fines or imprisonment, as stipulated in the relevant sections of the Act. These provisions underscore the importance of adhering to the legislative requirements and the potential legal ramifications of non-compliance.