EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0708865
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.
Baulderstone Hornibrook Pty Ltd & Bilfinger applied for a TCO in respect of certain steel cord conveyor belts on 12 June 2007.
Instrument
TCO No 0708865 was made on 24 August 2007. It declares that those certain steel cord conveyor belts 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. 0708865 is taken to have come into force on 12 June 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 by the Parliament of Australia to regulate the importation and exportation of goods, including the imposition of customs duty. The Act was introduced to address the need for a structured approach to managing trade-related taxes and ensuring compliance with international trade agreements. Part XVA of the Act outlines the scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs, providing lower rates of customs duty on specified goods. Tariff Concession Instrument No. 0708865, made under the authority of the Customs Act 1901, was introduced on 24 August 2007. This instrument provides a tariff concession for certain steel cord conveyor belts, reducing the duty rate from 5% to free, effective from 12 June 2007, the date the application was lodged. The policy objective is to support Australian businesses by making certain imported goods more affordable, thereby encouraging the use of these goods in their operations. The process included an invitation for public submissions, which did not receive any responses, indicating no opposition to the concession.
Scope and Application
The Customs Act 1901, specifically through Part XVA, facilitates the establishment of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This legislative framework applies to individuals or entities seeking lower rates of customs duty on specific goods, provided the goods are not restricted by section 269SJ of the Act and meet the core criteria outlined in section 269C. The scope of this Act extends to the entire Commonwealth of Australia, impacting a broad range of industries that rely on the importation of goods. Entities such as Bauderstone Hornibrook Pty Ltd & Bilfinger can apply for TCOs for goods like steel cord conveyor belts, provided there are no substitutable goods produced domestically, as stipulated by sections 269D and 269E. Any person considering that a TCO should not be made is invited to submit objections, as per section 269K(1), though in this case, no submissions were received. The TCO does not affect any existing rights or liabilities of parties other than the Commonwealth, and it does not impose any new liabilities, ensuring that the rights of importers are positively affected by allowing them to apply for duty refunds on goods imported after the effective date of the TCO.
Key Provisions
The Tariff Concession Instrument No. 0708865 under the Customs Act 1901 sets out a concession for certain steel cord conveyor belts. Section 269P(3) of the Act mandates that if the Chief Executive Officer (CEO) of Customs is satisfied that an application for a Tariff Concession Order (TCO) meets the core criteria, a written order must be made declaring the goods in question are subject to a specified rate of duty (section 269P(3)). In this case, the TCO was made on 24 August 2007 and it declares that certain steel cord conveyor belts are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, granting a free rate of duty instead of the general rate of 5%.
The Act imposes specific obligations on the CEO of Customs when considering an application for a TCO. Under section 269F of the Act, an application can be made by a person 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, which sets out goods that cannot be subject to a TCO, the CEO must then determine whether the application meets the core criteria as outlined in section 269C. A TCO application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. The terms "goods produced in Australia", "ordinary course of business" and "substitutable goods" are further defined in sections 269D, 269E, and 269G respectively.
Failure to comply with the provisions of the Customs Act 1901 could result in various consequences. While the explanatory statement does not specify particular offences or penalties related to breaches of the TCO, it is implied that non-compliance with the Act's requirements could lead to legal ramifications. These could include fines or other penalties as stipulated by the relevant legislation. The Act's provisions are designed to ensure that the tariff concession process is followed correctly and that the rights of all parties are protected.
In summary, Tariff Concession Instrument No. 0708865, under the Customs Act 1901, provides a concession for certain steel cord conveyor belts, granting them a free rate of duty instead of the general rate of 5%. The Act outlines the obligations of the CEO of Customs when considering a TCO application, including ensuring that the application meets the core criteria. Non-compliance with the Act's provisions may result in legal consequences, although specific penalties are not detailed in the explanatory statement.