EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0701603
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.
Imtram Pty Ltd applied for a TCO in respect of certain railway sleeper handlers on 31 January 2007.
Instrument
TCO No 0701603 was made on 30 April 2007. It declares that those certain railway sleeper handlers 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. 0701603 is taken to have come into force on 31 January 2007.
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. 0701603 was enacted under the Customs Act 1901 to address the need for tariff concessions on specific imported goods, in this case, certain railway sleeper handlers. The instrument was made on 30 April 2007 and came into force on the day the application was lodged, 31 January 2007. This was enacted by the Chief Executive Officer of Customs (CEO) in accordance with the Customs Act 1901, specifically under section 269F, which allows for the application of Tariff Concession Orders (TCOs) on goods that meet the core criteria set out in the Act. The policy objective of this instrument is to provide tariff concessions where no substitutable goods are produced in Australia, thereby potentially benefiting importers by allowing them to apply for a refund of duty on the goods since the effective date of the TCO. This approach ensures that the rights of importers are beneficially affected while not imposing any liabilities on any person other than the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0701603 under the Customs Act 1901 applies to specific goods, in this case, certain railway sleeper handlers, which are now eligible for a lower rate of customs duty as per the instrument. This legislation is applicable to entities such as Intram Pty Ltd, which submitted the application for tariff concession. The geographic reach of this Act is national, as it is governed under the Commonwealth of Australia. The Act extends its application through subordinate instruments, specifically the Customs Tariff Act 1995. The core criteria for a tariff concession order is met if no substitutable goods are produced in Australia in the ordinary course of business, as per section 269C of the Act. The instrument does not disadvantage any person or impose liabilities on anyone in respect of anything done or omitted to be done before the date of registration. It is important to note that this instrument does not apply to goods specified in section 269SJ of the Act, which outlines those goods that cannot be subject to a tariff concession order.
Key Provisions
The key operative sections of the Tariff Concession Instrument No. 0701603, which is a part of the Customs Act 1901, primarily revolve around the process for applying for a Tariff Concession Order (TCO). Section 269F allows for applications to be made to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. If the application is deemed valid and meets the core criteria outlined in section 269C, the CEO is required to make a written order (a TCO) that specifies the goods to which the concession applies (section 269P(3)). In this particular case, the TCO No. 0701603, declared that certain railway sleeper handlers are subject to the concession, with a rate of duty reduced to free, from the general rate of 5%.
The Act imposes specific obligations on the parties involved. The CEO must assess whether an application meets the core criteria, which includes verifying that no substitutable goods were produced in Australia on the day the application was lodged (section 269C). The CEO must also publish a notice in the Gazette inviting any interested parties to submit any reasons why the TCO should not be granted (subsection 269K(1)). In this instance, the CEO did not receive any submissions opposing the TCO. The TCO itself does not affect the rights of any person as at the date of registration, ensuring that no person (other than the Commonwealth) is disadvantaged or imposed with liabilities for actions taken before the registration date.
Under the Act, there are potential consequences for breaches, although the explanatory statement does not detail specific offences or penalties related to the making of a TCO. However, any misuse or fraudulent application for a TCO could potentially lead to legal consequences under broader customs and trade laws, which may include fines and imprisonment. The precise penalties would depend on the nature and severity of the breach, in accordance with the applicable sections of the Customs Act 1901 and related legislation.