EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0615641
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.
Grove Australia Pty Ltd applied for a TCO in respect of certain self erecting cranes on 10 October 2006.
Instrument
TCO No 0615641 was made on 22 December 2006. It declares that those certain self erecting cranes 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. 0615641 is taken to have come into force on 10 October 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 Australian Parliament, provides a framework under which Tariff Concession Orders (TCOs) can be made to reduce the customs duty on certain goods. The Act allows for the CEO of Customs to grant tariff concessions if certain criteria are met, such as the absence of substitutable goods produced in Australia. This mechanism is designed to promote trade and economic efficiency by lowering the cost of imported goods that do not have local alternatives. TCO No. 0615641, made on 22 December 2006, is an example of this process, where the CEO granted a concession for certain self-erecting cranes, reducing their duty rate from 5% to 0%. The instrument became effective on the date the application was lodged, 10 October 2006, and no submissions opposing the concession were received during the consultation period.
Scope and Application
The Tariff Concession Instrument No. 0615641, pursuant to the Customs Act 1901, applies specifically to certain self-erecting cranes and is designed to provide tariff concessions to those importing such goods. This instrument, created under the authority vested in the Chief Executive Officer of Customs, applies to any entity or person importing these specified goods, ensuring they benefit from a reduced rate of customs duty. The instrument is in effect from the date the application was lodged, 10 October 2006, and operates within the Commonwealth jurisdiction. Importantly, it does not affect the rights of any person other than the Commonwealth as at the date of registration, and no liabilities are imposed on any person as a result of its implementation. The instrument also extends its application through subordinate instruments, such as the Customs Tariff Act 1995, which specifies the duty rates applicable to the goods subject to the concession.
Key Provisions
The primary sections of Tariff Concession Instrument No. 0615641 under the Customs Act 1901 (the Act) are section 269C, section 269P, and section 269S. Section 269C of the Act requires that a Tariff Concession Order (TCO) application meets core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business (section 269C). Section 269P mandates that if the Chief Executive Officer (CEO) of Customs is satisfied that a TCO application meets the core criteria, they must make a written order declaring the goods subject to the application to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies (section 269P(3)). Section 269S stipulates that a TCO comes into force on the day on which the application for the TCO was lodged (subsection 269S(1)).
The Act imposes specific obligations on the CEO of Customs in the context of TCOs. Upon receiving a valid TCO application, the CEO must determine whether the application meets the core criteria (section 269C). If the application meets these criteria, the CEO must issue a written TCO (section 269P(3)). Additionally, the CEO must publish a notice in the Gazette inviting submissions from any person who considers there are reasons why the TCO should not be made, although this is not always necessary if no submissions are received (subsection 269K(1)). The CEO must also ensure that the TCO does not affect the rights of any person as at the date of registration so as to disadvantage that person or impose liabilities in respect of anything done or omitted to be done before the date of registration (subsection 269S(2)).
The Act does not explicitly outline offences, penalties, or consequences for breach of the TCO provisions. However, it does provide that the TCO does not impose any liabilities on any person, ensuring that no person is disadvantaged by the TCO (subsection 269S(2)). Any dispute or non-compliance with the TCO would likely be addressed under the general provisions of the Customs Act 1901 or relevant administrative procedures.