EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0714693
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.
Qms Engineering Pty Ltd applied for a TCO in respect of certain ore crushers and or grinders parts on 10 September 2007.
Instrument
TCO No 0714693 was made on 30 November 2007. It declares that those certain ore crushers and or grinders 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. 0714693 is taken to have come into force on 10 September 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. 0714693, enacted in 2007, is a legislative measure under the Customs Act 1901, aimed at addressing the need for tariff concessions on specific goods that are not produced domestically. The Act empowers the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that apply reduced customs duty rates on goods that meet certain criteria, specifically where no substitutable goods are produced in Australia. This legislative instrument was introduced in response to an application by Qms Engineering Pty Ltd for tariff concessions on certain ore crushers and grinders parts. The policy objective is to facilitate the import of these goods by reducing the duty burden, thereby supporting businesses that rely on these imports and potentially lowering costs for consumers. The instrument was made effective from the date the application was lodged, ensuring timely relief for the applicant and other importers of the specified goods.
Scope and Application
The Tariff Concession Instrument No. 0714693 under the Customs Act 1901 applies specifically to certain ore crushers and grinder parts, facilitating a tariff concession that reduces the customs duty on these goods from the general rate of 5% to free. This legislation is enacted at the Commonwealth level and operates within the broader scheme of Tariff Concession Orders (TCOs) established under Part XVA of the Customs Act 1901. The application of this particular TCO is contingent on the Chief Executive Officer of Customs (CEO) being satisfied that no substitutable goods are produced in Australia, which is a condition outlined in section 269C of the Act. The CEO's decision to grant the concession was made on 30 November 2007, following an application from Qms Engineering Pty Ltd on 10 September 2007. Notably, the instrument does not affect the rights of any person other than the Commonwealth, ensuring that no one is disadvantaged or imposed upon by the concession, particularly concerning actions taken before the registration of the TCO. The TCO came into effect on the day the application was lodged, aligning with the provisions in subsection 269S(1) of the Act.
Key Provisions
The main operative sections of the legislation revolve around the creation and implementation of Tariff Concession Orders (TCOs) under the Customs Act 1901 (sections 269C, 269F, and 269P(3)). According to section 269F, a person can apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. If the application meets the core criteria outlined in section 269C, the CEO must then make a written order, known as a TCO, declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. In this specific case, Instrument TCO No 0714693 was issued on 30 November 2007, declaring that certain ore crushers and grinders parts are subject to a free rate of duty, which contrasts with the general rate of 5%.
The Act imposes specific obligations and requirements on both the applicant and the CEO. For the applicant, the primary requirement is to ensure that the goods in question do not have substitutable goods produced in Australia, as per section 269C. The CEO, on the other hand, must review the application, determine if it meets the core criteria, and if satisfied, issue a TCO. Additionally, under section 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made. This process ensures transparency and allows interested parties to voice their concerns.
Failure to comply with the requirements set forth in the Customs Act 1901 and related regulations could lead to various consequences. Although the explanatory statement does not detail specific offences or penalties, breaches of customs laws generally may result in both civil and criminal penalties. Civil penalties can include fines and the forfeiture of goods, while criminal penalties may encompass imprisonment, depending on the severity and intent of the breach. The maximum penalties can vary, but they are established under relevant sections of the Customs Act and associated regulations.
The TCO does not affect the rights of any person, other than the Commonwealth, in a manner that would disadvantage them or impose liabilities for actions taken before the date of registration. Instead, it provides beneficial rights to importers, allowing them to apply for a refund of duty on goods imported since the TCO came into force under paragraph 126(1)(r) of the Regulations. This ensures that no existing rights or liabilities are unfairly impacted by the issuance of the TCO.