EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0707614
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.
Laminex Pty Ltd applied for a TCO in respect of certain hydraulic presses on 22 May 2007.
Instrument
TCO No 0707614 was made on 10 August 2007. It declares that those certain hydraulic presses 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 0%.
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. 0707614 is taken to have come into force on 22 May 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, enacted by the Australian Parliament, established a framework within which Tariff Concession Orders (TCOs) could be issued by the Chief Executive Officer of Customs. This legislation aimed to address the problem of providing tariff relief for certain imported goods under specific circumstances. TCO No. 0707614, made under this Act, was introduced to provide tariff concessions for particular hydraulic presses imported by Laminex Pty Ltd, with the objective of ensuring that no substitutable goods were produced in Australia at the time of the application. The instrument declares that the specified hydraulic presses are subject to a reduced rate of customs duty, from the general rate of 5% to 0%, reflecting the policy objective of facilitating trade by lowering import costs for these specific goods.
Scope and Application
The Tariff Concession Instrument No. 0707614, under the Customs Act 1901, applies to any person or entity seeking a Tariff Concession Order (TCO) for goods specified in their application, provided these goods are not listed in section 269SJ of the Act as ineligible for TCOs. This Act operates at a Commonwealth level, and its provisions extend across Australia, impacting industries and entities involved in the importation of goods subject to customs duties. The scope of this legislation is specifically tailored to goods that do not have substitutable Australian-made alternatives, as defined by the Act, ensuring that the concession applies only to imports where domestic production does not meet the specific needs of the applicant. The application process requires the Chief Executive Officer of Customs to assess whether the goods in question meet the core criteria outlined in the Act, such as the absence of substitutable Australian goods. Once a TCO is granted, it confers a zero percent duty rate on the specified goods, which contrasts with the general duty rate of five percent applicable to such goods, thereby reducing the financial burden on the importer. Any exclusions or exemptions from the application of the TCO are strictly defined within the Act and are contingent on the specifics of the goods in question. The commencement of the TCO aligns with the date of application, ensuring that the rights of parties involved are protected and that no adverse effects are imposed retroactively.
Key Provisions
The primary sections of the Tariff Concession Instrument No. 0707614, made under the Customs Act 1901, establish the framework and conditions for Tariff Concession Orders (TCOs) concerning specific goods. Section 269F allows an individual to apply to the Chief Executive Officer of Customs (CEO) for a TCO concerning goods, provided the goods are not prohibited by section 269SJ. The CEO is mandated to evaluate the application against the core criteria outlined in section 269C. If the application meets these criteria, which include the absence of substitutable goods produced in Australia as per section 269D and 269E, the CEO must issue a written order under section 269P(3) declaring that the goods in question are subject to a specific rate of duty as listed in Schedule 4 of the Customs Tariff Act 1995.
Entities or individuals seeking a TCO must adhere to the procedural requirements stipulated in the Customs Act 1901. An applicant must submit a formal request to the CEO, ensuring that the goods do not fall under the prohibitions outlined in section 269SJ. The CEO is then required to publish a notice in the Gazette, inviting any interested parties to submit objections if they believe the TCO should not proceed, as per section 269K(1). In the case of TCO No. 0707614, Laminex Pty Ltd applied for a concession on certain hydraulic presses on 22 May 2007, and after meeting the core criteria, the CEO issued the TCO on 10 August 2007.
Failure to comply with the provisions of the Customs Act 1901 or the terms of a TCO can lead to various legal consequences. While the explanatory statement does not explicitly detail specific offences or penalties, breaches of customs regulations generally attract penalties as prescribed by the Customs Act 1901. For instance, knowingly making a false statement in an application can lead to criminal charges, with penalties that may include fines or imprisonment. Civil penalties may also apply for non-compliance, which can include financial penalties or the requirement to pay back any duties that were improperly claimed. The severity of these penalties can vary depending on the nature and extent of the breach.