EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0617404
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.
Siemens Ltd applied for a TCO in respect of certain railway train detection systems parts on 20 September 2006.
Instrument
TCO No 0617404 was made on 15 December 2006. It declares that those certain railway train detection systems 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. 0617404 is taken to have come into force on 20 September 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. 0617404 was enacted in 2006 under the Customs Act 1901. This legislation was introduced to address the need for tariff concessions for specific goods that are not produced domestically, ensuring that businesses can access necessary imports without being subject to high customs duties. The instrument was developed in response to an application by Siemens Ltd for tariff concessions on certain railway train detection systems parts. The primary objective of this legislation is to provide relief from customs duties for goods that cannot be produced in Australia, thus facilitating the importation of these goods at a lower rate of duty.
The enactment of this instrument is carried out by the Chief Executive Officer of Customs, who must ensure that the application for tariff concessions meets the specified core criteria. In this case, the CEO determined that no substitutable goods were produced in Australia, thereby satisfying the conditions under section 269C of the Customs Act 1901. As a result, the CEO issued Tariff Concession Order No. 0617404, declaring that the specified railway train detection systems parts would be subject to a duty rate of free, as opposed to the general rate of 5%. This order was published in the Gazette with an invitation for submissions, though none were received. The tariff concession came into effect on the date the application was lodged, 20 September 2006, and it does not impose any liabilities on persons other than the Commonwealth, while potentially benefiting importers through duty refunds under the Customs Regulations.
Scope and Application
The Tariff Concession Instrument No. 0617404, under the Customs Act 1901, applies to entities seeking tariff concessions on specific goods, in this case, certain railway train detection systems parts. The Act governs the process through which the Chief Executive Officer of Customs may grant a Tariff Concession Order (TCO) to lower the customs duty on particular goods. This legislation applies to any person or entity that submits an application for a TCO, provided the goods in question do not fall under the exclusions specified in section 269SJ of the Act. The application must meet the core criteria outlined in section 269C, which requires that no substitutable goods are produced in Australia in the ordinary course of business. The TCO has a national reach and applies to all importers within the Commonwealth of Australia. The TCO No. 0617404 specifically exempts the specified railway train detection systems parts from the general duty rate of 5%, making the duty rate free for these goods. The instrument does not affect the rights of any person, except to beneficially affect the rights of importers who can apply for a refund of duty on goods imported since the TCO came into force on 20 September 2006. No liabilities are imposed on any person under this TCO. The CEO is required to publish a notice in the Gazette inviting any person who believes the TCO should not be made to lodge a submission, although in this instance, no submissions were received.
Key Provisions
The primary operative sections of Tariff Concession Instrument No. 0617404 are Sections 269C, 269F, 269P, and 269S of the Customs Act 1901, which detail the process and criteria for making Tariff Concession Orders (TCOs). Section 269F allows any person to apply to the Chief Executive Officer (CEO) of Customs for a TCO for certain goods, and Section 269C specifies that a TCO will be granted if the CEO is satisfied that no substitutable goods were produced in Australia on the day the application was lodged. Section 269P(3) mandates that if the CEO approves the TCO application, they must issue a written order specifying the goods and the applicable tariff concession. Section 269S outlines the commencement date of the TCO, which is the day the application was lodged.
The Act imposes specific obligations on the CEO of Customs, including the requirement to assess whether an application meets the core criteria for a TCO as stipulated in Section 269C. This involves determining if no substitutable goods were produced in Australia on the day the application was lodged. The CEO must also publish a notice in the Gazette inviting any interested parties to submit reasons why the TCO should not be made, as per Subsection 269K(1). Furthermore, the CEO is responsible for ensuring that the TCO does not disadvantage any person or impose liabilities on any person in respect of anything done or omitted to be done before the date of registration.
Under the Customs Act 1901, breaches of the provisions related to Tariff Concession Orders may not explicitly list specific offences or penalties within the provided text. However, it is implied that failure to comply with the requirements for making or enforcing a TCO could lead to legal consequences. The potential penalties for non-compliance with customs regulations generally include fines and imprisonment, as outlined in the Customs Act 1901 and other related legislation. For instance, misleading or providing false information in a TCO application could result in civil or criminal penalties, with maximum fines and imprisonment terms as stipulated in the relevant sections of the Customs Act and associated regulations.