EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0715850
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 reciprocating grate on 20 September 2007.
Instrument
TCO No 0715850 was made on 30 November 2007. It declares that those certain reciprocating grates 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. 0715850 is taken to have come into force on 20 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. 0715850, enacted in 2007, is a measure under the Customs Act 1901 to address the need for tariff concessions on specific imported goods. This instrument was introduced to facilitate a reduction in customs duty on certain reciprocating grates, as requested by Laminex Pty Ltd. The instrument was created following the application process outlined in the Customs Act, where it was determined that no substitutable goods were being produced in Australia at the time of the application. The Tariff Concession Order (TCO) was made to ensure that the application met the core criteria as stipulated in the Act, particularly under sections 269C and 269SJ, ensuring that the requested tariff concession did not contravene any legislative prohibitions. The instrument was published in the Gazette, inviting any objections; however, none were received, leading to the issuance of the TCO on 30 November 2007. The TCO came into force on 20 September 2007, the date the application was lodged, and it provides a duty-free status for the specified goods, benefiting importers who may apply for duty refunds for imports made since the commencement date.
Scope and Application
The Tariff Concession Instrument No. 0715850, made under the Customs Act 1901, pertains to the application of Tariff Concession Orders (TCOs) concerning specific reciprocating grates. This Act applies to any person or entity seeking a reduction in customs duty on imported goods through the application process outlined in section 269F. The TCO applies to the goods specified in the order, in this case, certain reciprocating grates, and is subject to the conditions that no substitutable goods are produced in Australia in the ordinary course of business. The application of this Act is national in scope, administered by the Chief Executive Officer of Customs at a Commonwealth level, and the TCO affects the importation of goods as per the prescribed items of Schedule 4 to the Customs Tariff Act 1995. The instrument does not apply to goods specified in section 269SJ of the Customs Act 1901, which are ineligible for tariff concessions. The TCO came into force on the date of the application, 20 September 2007, and the rights of importers will be advantageously impacted, allowing them to apply for a refund of duty from the effective date of the TCO without any liabilities imposed on them or others prior to the registration date.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0715850 under the Customs Act 1901 include section 269F, which outlines the process for applying for a Tariff Concession Order (TCO), and section 269P(3), which mandates that the Chief Executive Officer of Customs (CEO) must make a written order if satisfied that the application meets the core criteria. Section 269C specifies that the application meets the core criteria if no substitutable goods were produced in Australia on the day the application was lodged. This section is crucial because it sets the condition for the CEO to proceed with making a TCO. Section 269S(1) stipulates that the TCO comes into force on the day the application is lodged, in this case, 20 September 2007. This means that from that date, the special duty rate applies to the goods specified in the TCO.
The obligations imposed on the parties governed by this Act include the requirement for an applicant to ensure their TCO application adheres to the criteria set out in section 269C. The CEO has the obligation to publish a notice in the Gazette as soon as practicable after accepting a TCO application, inviting any interested parties to submit objections. In this instance, no submissions were received. Furthermore, section 269K(1) necessitates that the CEO consider any submissions received before making a decision on the TCO. The CEO must also ensure that the TCO does not disadvantage any person or impose liabilities on anyone in respect of actions taken before the TCO's effective date.
Any failure to comply with the provisions of this Act may result in various consequences. Specifically, section 269SJ lists goods that cannot be subject to a TCO, and any attempt to apply for a TCO for such goods would be invalid. Additionally, section 269P(3) imposes a requirement on the CEO to make a written order if the application meets the core criteria, and failure to do so may lead to legal repercussions. Under the Customs Act 1901, offences related to customs duty can attract significant penalties. For example, section 133-5 of the Crimes Act 1914 outlines that persons can be fined up to 10,000 penalty units or imprisoned for five years, or both, for knowingly importing goods in a manner that contravenes the Act. Similarly, section 133-10 of the same Act imposes fines up to 5,000 penalty units or imprisonment for two years, or both, for similar breaches concerning the export of goods. These penalties underscore the seriousness of non-compliance with customs regulations.