EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0802051
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.
Pacific Hoists Pty Ltd applied for a TCO in respect of certain pallet trucks on 5 February 2008.
Instrument
TCO No 0802051 was made on 11 April 2008. It declares that those certain pallet 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. 0802051 is taken to have come into force on 5 February 2008.
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 Commonwealth Parliament, introduces a scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (CEO) to apply a lower rate of customs duty on certain goods. The legislation aims to facilitate the importation of goods that are not produced domestically, thereby supporting economic efficiency and consumer choice. The Explanatory Statement for Tariff Concession Instrument No. 0802051, made under this Act on 11 April 2008, outlines a specific instance where Pacific Hoists Pty Ltd successfully applied for a TCO concerning certain pallet trucks. This measure was introduced to ensure that no substitutable goods were produced in Australia at the time of the application, thus qualifying for the concession. The policy objective is to encourage the importation of goods that are not domestically manufactured, thereby benefiting importers who can now apply for duty refunds on goods imported since the TCO's effective date.
Scope and Application
The Tariff Concession Instrument No. 0802051, under the Customs Act 1901, applies to the specific case of Pacific Hoists Pty Ltd's application for a Tariff Concession Order (TCO) concerning certain pallet trucks. The instrument's scope is limited to the goods specified in the application, namely the pallet trucks for which a lower rate of customs duty is sought. The application of the Act is confined to entities or individuals seeking tariff concessions for goods that are not produced in Australia and for which no substitutable goods exist in the ordinary course of business. The TCO applies from the date the application was lodged, which in this case was 5 February 2008, and it does not affect any rights or impose liabilities on any person other than the Commonwealth with respect to actions taken before the date of registration. The geographic reach of the Act and the TCO is national, as it applies across Australia under the Commonwealth's legislative authority. The TCO is subject to exclusions as outlined in section 269SJ of the Act, which lists goods that cannot be the subject of a TCO. The Act allows for further specification and extension of its application through subordinate instruments, ensuring flexibility and adaptability to various cases and industries.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 0802051 pertain to the Customs Act 1901 (the Act) and the Customs Tariff Act 1995 (the Tariff). Section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a Tariff Concession Order (TCO) in respect of goods. Section 269C mandates that a TCO application meets the core criteria if no substitutable goods were produced in Australia on the day the application was lodged. Section 269P(3) requires the CEO to make a written order (a TCO) if satisfied that the application meets the core criteria. This instrument declares that the pallet trucks in question are goods to which item 50 of Schedule 4 to the Tariff applies, thereby granting a concession by making the duty rate free.
The Act imposes several obligations on parties involved in the TCO process. Section 269K(1) requires the CEO to publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting submissions from any person who believes the TCO should not be made. While Pacific Hoists Pty Ltd applied for a TCO on 5 February 2008, no submissions were received in response to this invitation. Furthermore, section 269S(1) stipulates that a TCO comes into force on the day the application was lodged. TCO No. 0802051 is therefore deemed to have come into force on 5 February 2008.
Under the Customs Act 1901, any breach of the terms set out in the Tariff Concession Instrument No. 0802051 may result in civil or criminal penalties. While the explanatory statement does not detail specific penalties, breaches of the Customs Act generally may incur significant fines or imprisonment, depending on the nature and severity of the breach. For instance, under section 214 of the Customs Act, a person who contravenes a provision of the Act may be fined up to 10,000 penalty units or imprisoned for up to five years, or both, for a single offence. Additionally, section 269 of the Act may impose penalties for making false or misleading statements in the application process, further emphasising the importance of compliance with the statutory requirements.
In conclusion, the Tariff Concession Instrument No. 0802051 provides a framework for the application and implementation of Tariff Concession Orders under the Customs Act 1901. It outlines the criteria for eligibility and the procedural obligations of the CEO. The Act also delineates the rights of importers and the effective date of the TCO, ensuring that the rights of non-Commonwealth persons are not adversely affected. Any breaches of the provisions in this instrument may result in civil or criminal penalties, highlighting the importance of adherence to the legislative requirements.