EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0610571
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.
Thyssen Krupp Engineering (Aust) Pty Ltd applied for a TCO in respect of certain grinding roll presses on 19 June 2006.
Instrument
TCO No 0610571 was made on 8 September 2006. It declares that those certain grinding roll presses 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. 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. 0610571 is taken to have come into force on 19 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 Customs Act 1901, enacted by the Parliament of Australia, establishes a framework for the administration of customs duties and other import charges. The Customs Act 1901 was introduced to address the need for streamlined and efficient regulation of international trade through the imposition of customs duties and other import charges. Part XVA of this Act allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which provide for lower rates of customs duty on specified goods. This legislative measure was intended to facilitate trade by reducing the cost burden on importers of certain goods. Specifically, it aims to encourage the importation of goods that are not domestically produced, thereby supporting economic efficiency and consumer choice. Instrument TCO No. 0610571, made on 8 September 2006, exemplifies this approach by reducing the duty on certain grinding roll presses from 5% to 0%, provided no substitutable goods were produced in Australia at the time of application.
Scope and Application
The Tariff Concession Instrument No. 0610571 under the Customs Act 1901 applies specifically to certain grinding roll presses as applied for by Thyssen Krupp Engineering (Aust) Pty Ltd. The Act facilitates the granting of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, enabling a lower rate of customs duty for specified goods, provided they meet the core criteria outlined in the Act. This particular instrument was made to declare that the goods in question are subject to a 0% duty rate as opposed to the general rate of 5%, effective from 19 June 2006, the date of application. The scope of the Act extends to any entity or individual seeking tariff concessions for goods, ensuring that such applications are assessed against the criteria of substitutable goods and Australian production in the ordinary course of business. Notably, the Act does not apply to goods specified in section 269SJ, which are ineligible for tariff concessions. Additionally, the instrument itself does not impose any new liabilities on individuals or entities and protects existing rights, thereby not disadvantaging anyone who has already imported the goods before the TCO's effective date.
Key Provisions
The Tariff Concession Instrument No. 0610571 under the Customs Act 1901 primarily concerns the application and grant of a Tariff Concession Order (TCO) for certain grinding roll presses, as requested by Thyssen Krupp Engineering (Aust) Pty Ltd. According to section 269F, an individual or entity can apply to the Chief Executive Officer of Customs (CEO) for a TCO, provided the goods in question are not prohibited by section 269SJ. If the CEO determines that the application meets the core criteria outlined in section 269C, they must issue a TCO. Specifically, this means that on the day the application was submitted, no substitutable goods were produced in Australia in the ordinary course of business, as defined by sections 269D and 269E.
The obligations under the Act require that, upon receiving a valid TCO application, the CEO must make a written order specifying the lower duty rate that applies to the goods in question. For the specific case of grinding roll presses, this involves declaring that these goods are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, resulting in a 0% duty rate instead of the general 5% rate. Furthermore, the CEO must publish a notice in the Gazette inviting any interested parties to submit objections to the TCO. In this instance, no submissions were received, indicating broad acceptance or lack of opposition to the TCO.
Failure to comply with the requirements set out in the Customs Act 1901 could result in civil or criminal penalties. The specific penalties are not detailed in the text, but generally, breaches of customs regulations can lead to fines or other sanctions. For instance, section 269G(2) provides that any person who contravenes a TCO or the Act may be subject to fines or imprisonment, depending on the severity and intent of the breach. It is also important to note that the TCO does not affect any pre-existing rights or liabilities of parties other than the Commonwealth.
Finally, the TCO, once granted, has retrospective effect from the date the application was lodged, as per section 269S(1). This means that the reduced duty rate applies to all imports of the specified goods from that date onward, allowing importers to apply for duty refunds for goods imported since the TCO's effective date under paragraph 126(1)(r) of the Regulations. Importantly, the TCO does not impose any new liabilities on any person, ensuring that it does not disadvantage any party or create new obligations for those who have already acted in accordance with prior regulations.