EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0702055
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.
H.T. Engineering Pty Limited applied for a TCO in respect of certain boiler circulating pump parts on 13 February 2007.
Instrument
TCO No 0702055 was made on 04 May 2007. It declares that those certain boiler circulating pump 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. 0702055 is taken to have come into force on 13 February 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 Customs Act 1901 was enacted to regulate the importation and exportation of goods into and out of Australia, including the imposition of customs duties on imported goods. The Act was amended to introduce Tariff Concession Orders (TCOs), which provide for a lower rate of customs duty on certain goods under specific conditions. The Tariff Concession Instrument No. 0702055 was introduced to address the problem of high customs duties on certain boiler circulating pump parts, which were not being produced in Australia and were essential for various industries. The instrument was enacted by the Chief Executive Officer of Customs, pursuant to the authority granted under section 269F of the Customs Act 1901. The policy objective of this instrument is to provide tariff relief for certain imported goods, thereby promoting competition and reducing costs for Australian businesses that rely on these goods.
Scope and Application
The Tariff Concession Instrument No. 0702055 under the Customs Act 1901 applies specifically to goods for which an application for tariff concession has been lodged and approved by the Chief Executive Officer of Customs. This particular instrument relates to certain boiler circulating pump parts for which H.T. Engineering Pty Limited applied, resulting in a concession that exempts these goods from the general rate of customs duty, which is 5%, down to a free rate. The instrument ensures that the concession applies to the goods specified in the application, namely those parts, without affecting the rights of any person other than the Commonwealth, and does not impose any liabilities on any person. The scope of this Act extends across the Commonwealth of Australia, governing the application and implementation of tariff concessions in alignment with the provisions of the Customs Act 1901 and the Customs Tariff Act 1995. Any exclusions or exemptions are explicitly detailed within the Act, with the process for applications and approvals being conducted in accordance with the stipulated legislative framework.
Key Provisions
The Tariff Concession Instrument No. 0702055 (the Instrument) made under the Customs Act 1901 (the Act) provides a tariff concession for certain boiler circulating pump parts. Section 269F of the Act allows for an application to be made to the Chief Executive Officer of Customs (the CEO) for a Tariff Concession Order (TCO) for goods. Upon the application being accepted and meeting the core criteria specified in section 269C, the CEO must make a written order (TCO) as per section 269P(3). This specific Instrument, made on 4 May 2007, declares that the certain boiler circulating pump parts are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, with the rate of duty for these goods being free, whereas the general rate is 5%.
The obligations imposed by the Act on the parties involved are primarily centred around the application and approval process for a TCO. Under section 269K(1) of the Act, the CEO must publish a notice in the Gazette inviting submissions if a TCO application is considered valid. In this case, no submissions were received in response to the notice. Additionally, section 269S(1) of the Act dictates that a TCO is effective from the date the application was lodged, which for TCO No. 0702055 is 13 February 2007. This means that any rights of importers are beneficially affected from that date, and they can apply for a refund of duty on goods imported since then under paragraph 126(1)(r) of the Regulations.
The Instrument does not impose any liabilities on any person and does not affect the rights of any person other than the Commonwealth as at the date of registration. It is important to note that the rights of importers will be positively impacted, providing them with the ability to seek refunds on duties paid on goods imported since the effective date of the TCO.
In terms of breaches and penalties, the Act does not explicitly detail offences or penalties for failing to comply with the provisions of a TCO or the process for obtaining one. However, it is implicit that non-compliance with the terms of the TCO or the application process could result in legal consequences, such as penalties for incorrect duty payments or other related breaches under the Customs Act. The specific penalties for such breaches would typically be found in other sections of the Customs Act or related legislation, which might include fines or other civil or criminal sanctions.