EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0618445
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.
NTP Forklifts Australia applied for a TCO in respect of certain reachstackers on 13 November 2006.
Instrument
TCO No 0618445 was made on 02 February 2007. It declares that those certain reachstackers 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. 0618445 is taken to have come into force on 13 November 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, provides a framework for the administration of customs and excise duties. Part XVA of this Act introduces a scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (CEO) to reduce the customs duty on specified goods. This scheme was introduced to address the problem of ensuring that certain imported goods, which do not have Australian-made alternatives, receive tariff concessions. Such concessions help in making imported goods more competitive with local products, thereby aiding in the economic efficiency of the market. Instrument No. 0618445, made under this Act, specifically grants a tariff concession for certain reachstackers, reducing their duty from 5% to free, effective from the date the application was lodged. This measure was taken after ensuring that no substitutable goods were produced in Australia, aligning with the core criteria set out in section 269C of the Act. The CEO published a notice in the Gazette inviting any objections to the concession, but none were received, facilitating the swift implementation of the concession.
Scope and Application
The Tariff Concession Instrument No. 0618445 under the Customs Act 1901 applies to specific goods in respect of which an application for a Tariff Concession Order (TCO) has been made, and these goods are declared to be subject to a reduced rate of customs duty. The Act allows for the CEO of Customs to make such orders if certain criteria are met, including the absence of substitutable goods produced in Australia. This legislation primarily affects entities or individuals who are importing the specified goods, providing them with tariff benefits by lowering the customs duty to zero, as opposed to the general rate of duty which is 5%. The instrument extends nationally across Australia, aligning with the federal nature of the Customs Act 1901. Any exclusions or limitations are stipulated within the core criteria of the Act, ensuring that only eligible goods that do not have Australian substitutes can benefit from the tariff concession. The Act also ensures that the implementation of the TCO does not adversely affect any existing rights or impose new liabilities on persons other than the Commonwealth, safeguarding the interests of those involved in the import process.
Key Provisions
The main operative sections of this legislation (sections 269C, 269P(3), and 269S) require that a Tariff Concession Order (TCO) can be made by the Chief Executive Officer of Customs (CEO) for goods that are not substitutable goods produced in Australia. If the CEO determines that a TCO application meets the core criteria (section 269C), they must make a written order (section 269P(3)) declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. This particular order, TCO No 0618445, was made on 02 February 2007 for certain reachstackers, declaring them as goods to which item 50 of Schedule 4 applies, with a duty rate of free, as opposed to the general rate of 5% (subsection 269S(1)).
The Customs Act 1901 imposes several obligations and requirements on the parties involved. For the CEO, it is mandatory to assess whether an application for a TCO meets the core criteria by confirming that no substitutable goods were produced in Australia in the ordinary course of business. If the application satisfies these criteria, the CEO must make the TCO. For applicants, they must submit a valid application to the CEO, and for the public, they must be given the opportunity to submit any submissions opposing the TCO within the prescribed timeframe. The CEO is also required to publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not be made.
Failure to comply with the provisions of the Customs Act 1901 can lead to various consequences. While the explanatory statement does not explicitly outline specific offences or penalties, it is reasonable to infer that breaches of the Act may result in legal action. This could include civil proceedings for non-compliance or criminal charges if the breach is deemed serious. Penalties could range from fines to imprisonment, depending on the severity and intent behind the breach. However, the exact penalties are not specified in the explanatory statement.