EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0705136
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.
Global Fire Solutions Pty Ltd applied for a TCO in respect of certain trucks on 04 April 2007.
Instrument
TCO No 0705136 was made on 29 June 2007. It declares that those certain trucks 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. 0705136 is taken to have come into force on 04 April 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. 0705136, enacted under the Customs Act 1901, was introduced to address the need for tariff concessions for specific imported goods. This instrument was created in response to an application by Global Fire Solutions Pty Ltd for a tariff concession order (TCO) regarding certain trucks. The Customs Act 1901 provides a framework for the Chief Executive Officer (CEO) of Customs to grant TCOs that result in a lower rate of customs duty on specified goods, provided certain criteria are met. In this instance, the CEO was satisfied that no substitutable goods were produced in Australia, and thus the application for a TCO was approved, leading to the issuance of TCO No. 0705136 on 29 June 2007. This TCO applies to the specified trucks, reducing the duty rate from the general rate of 5% to free. The instrument came into force on 4 April 2007, the date of the application, and it aims to ensure that the rights of importers are beneficially affected, including their eligibility to apply for a refund of duty on goods imported since the effective date of the TCO.
Scope and Application
The Tariff Concession Instrument No. 0705136, issued under the Customs Act 1901, applies to goods specified in the instrument, in this case certain trucks, and pertains to the relief from customs duties provided by a Tariff Concession Order (TCO). This relief is granted to entities or individuals who import these specified goods into Australia, provided that no substitutable goods are produced in Australia in the ordinary course of business. The instrument extends to the entire Commonwealth of Australia, ensuring that the tariff concession applies nationally. The scope of the legislation is further clarified by the exclusion of goods specified in section 269SJ of the Act, which cannot be subject to a TCO. The instrument, which came into force on the date of the application, does not affect any pre-existing rights or liabilities of persons other than the Commonwealth. Moreover, the CEO of Customs is required to publish notices in the Gazette to invite submissions from interested parties, although in this instance, no submissions were received. Any application for a TCO is subject to the core criteria outlined in the Customs Act 1901, including the absence of substitutable goods being produced in Australia.
Key Provisions
The primary operative sections of this legislation pertain to the process and criteria for the creation of Tariff Concession Orders (TCOs) under the Customs Act 1901 (section 269F). The Act allows for the application to the Chief Executive Officer of Customs (CEO) for a TCO on certain goods. If the CEO is satisfied that the application complies with the core criteria, which include the absence of substitutable goods produced in Australia in the ordinary course of business (section 269C), a written order is to be made (section 269P(3)). The instrument in question, TCO No 0705136, was made on 29 June 2007, declaring that certain trucks are subject to item 50 of Schedule 4 to the Tariff, with the rate of duty for these goods set at free, as opposed to the general rate of 5%.
The Act imposes specific obligations on both applicants and the CEO. Applicants must ensure that their TCO application does not pertain to goods specified in section 269SJ of the Act, which are ineligible for a TCO. The CEO, on the other hand, is required to assess the application against the core criteria, which involves verifying that no substitutable goods are produced in Australia (section 269C). Additionally, the CEO must publish a notice in the Gazette inviting any interested party to submit objections to the TCO (subsection 269K(1)). In this case, the CEO did not receive any submissions, which facilitated the progression of the TCO application.
The Act does not explicitly outline specific offences or penalties for breaches related to TCOs. However, it does stipulate the consequences of non-compliance with the provisions of the Customs Act 1901 more broadly. The TCO does not affect the rights of any person, other than the Commonwealth, in relation to actions taken before the date of registration of the TCO (subsection 269S(1)). For instance, the rights of importers will be positively impacted, as they will be eligible to apply for a refund of duty on goods imported since the day the TCO is deemed to have come into force. The TCO itself does not impose any liabilities on any person.
In conclusion, the Tariff Concession Instrument No. 0705136 under the Customs Act 1901 allows for a reduced rate of customs duty on certain trucks. The process for obtaining a TCO involves meeting specific criteria and submitting an application to the CEO, who must then assess the application and publish a notice in the Gazette inviting objections. This particular TCO came into force on the date the application was lodged, with no negative impact on the rights of any person, except for the Commonwealth, and no liabilities imposed on any person.