EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0609672
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 apron feeder parts on 01 June 2006.
Instrument
TCO No 0609672 was made on 25 August 2006. It declares that those certain apron feeder parts 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. 0609672 is taken to have come into force on 01 June 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. 0609672 was enacted in 2006 under the Customs Act 1901 to address the need for tariff concessions on specific goods. The Customs Act 1901, as amended, provides a framework for the Chief Executive Officer of Customs to grant tariff concessions to certain goods, allowing for a lower rate of customs duty. In this instance, Onesteel Manufacturing Pty Ltd applied for a tariff concession order (TCO) for certain apron feeder parts. The instrument, TCO No. 0609672, was published on 25 August 2006, declaring that these parts would be subject to a free rate of duty rather than the general rate of 5%, effective from 1 June 2006. This legislative action was taken to ensure that no substitutable goods were being produced in Australia, thereby meeting the core criteria set out in the Act. The enactment body responsible for this instrument is the CEO, who followed the legislative requirements for consultation and commencement, with no submissions received against the order.
Scope and Application
The Tariff Concession Instrument No. 0609672 applies to the specific goods identified in the instrument, namely certain apron feeder parts, and provides a lower rate of customs duty for these goods in accordance with the Customs Act 1901. This instrument is relevant to individuals and entities engaged in the importation of these particular goods, granting them a concession on customs duty. The scope of the Act extends to any person who applies for a Tariff Concession Order (TCO) in relation to goods that are not specified as ineligible under section 269SJ of the Customs Act 1901. The geographic reach of this Act is national, as it pertains to the importation of goods into Australia and is administered by the Chief Executive Officer of Customs (CEO) under the Commonwealth jurisdiction. The Act does not disadvantage any person, including importers, in respect of actions taken before the registration of the TCO, and it also does not impose any liabilities on any person as a result of the concession. The Act may be extended or restricted through subordinate instruments, which allow for further specifications and conditions related to the application of TCOs.
Key Provisions
The Customs Act 1901, through its Tariff Concession Orders (TCO) scheme, allows for reduced customs duties on certain goods, provided they meet specific criteria. Section 269F of the Act enables a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO, which provides for a lower rate of customs duty on the specified goods. If the CEO determines that the application complies with the core criteria set out in section 269C, they must make a written order (section 269P(3)). This means the goods become eligible for a lower duty rate as specified in the prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The obligations imposed by the Act on parties applying for a TCO include ensuring that the goods in question do not have substitutable goods produced in Australia. Section 269C requires the CEO to verify that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Additionally, section 269K(1) mandates that the CEO must publish a notice in the Gazette, inviting any interested parties to submit any objections to the proposed TCO. In the case of TCO No. 0609672, no submissions were received.
Breaching the conditions set by the Customs Act 1901 may result in civil or criminal consequences. While the explanatory statement does not specify the exact penalties, under Australian law, non-compliance with customs regulations can lead to fines and potential imprisonment, depending on the severity of the breach. For TCOs, failure to meet the eligibility criteria or misrepresentation of facts in an application could result in the TCO being revoked, and the affected parties may face financial penalties or legal action.