EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0802662
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.
Pilz Australia Industrial Automation Lp applied for a TCO in respect of certain safety relays on 04 April 2008.
Instrument
TCO No 0802662 was made on 27 June 2008. It declares that those certain safety relays 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. 0802662 is taken to have come into force on 04 April 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 was enacted to provide a framework for the administration of customs and excise duties and includes provisions for the establishment of Tariff Concession Orders (TCOs). The Tariff Concession Instrument No. 0802662, made in 2008, addresses the need for tariff concessions by allowing for a lower rate of customs duty on certain goods when no substitutable goods are produced in Australia. This instrument was introduced by the Chief Executive Officer of Customs, pursuant to the authority granted under section 269F of the Act. The policy objective behind this instrument is to facilitate trade by reducing the cost of imported goods, thereby benefiting importers and potentially enhancing the competitiveness of Australian industries that rely on these imported goods. The instrument came into force on the date the application was lodged, ensuring that the rights of importers are protected and that no existing liabilities are affected.
Scope and Application
The Tariff Concession Instrument No. 0802662 under the Customs Act 1901 applies to specific goods, in this instance, certain safety relays, and provides a concession on the customs duty rate for these goods. This Act applies to individuals and entities who import these safety relays, thereby impacting the importing community. The Act's jurisdictional reach is national, as it is a Commonwealth Act. The application process for a Tariff Concession Order (TCO) is overseen by the Chief Executive Officer of Customs, who determines whether an application meets the core criteria specified in the Act. Specifically, the Act stipulates that no substitutable goods must be produced in Australia in the ordinary course of business on the date the application is lodged. In this instance, the CEO concluded that no such substitutable goods were being produced in Australia, leading to the issuance of the TCO. The TCO has no retrospective effect and does not disadvantage any person, nor does it impose any liabilities on individuals or entities other than the Commonwealth. The TCO came into force on the date the application was lodged, which was 4 April 2008.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0802662 (the Instrument) under the Customs Act 1901 (the Act) pertain to the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (the CEO). Section 269F allows for an application to be made for a TCO in respect of certain goods. Section 269C specifies that a TCO application meets the core criteria if, on the day it was lodged, no substitutable goods were produced in Australia in the ordinary course of business. If the CEO is satisfied that the application meets these criteria, they are required under section 269P(3) to issue a TCO, which declares the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies.
The obligations imposed on parties under this Instrument include the requirement for applicants to ensure their applications meet the core criteria set out in section 269C. This involves demonstrating that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. The CEO must then assess the application against these criteria and, if satisfied, issue a TCO. Additionally, section 269K(1) mandates the CEO to publish a notice in the Gazette inviting any interested parties to submit any objections to the proposed TCO. The CEO in this case did not receive any submissions in response to the notice published.
There are no specific offences, penalties, or civil/criminal consequences mentioned in the Instrument for breaches of the requirements or obligations. However, the Act generally includes provisions for penalties related to non-compliance with customs regulations. For instance, section 230A of the Customs Act 1901 provides for penalties for offences such as providing false or misleading information in connection with the importation or exportation of goods. The maximum penalties can include fines of up to $22,200 for individuals and substantially higher for corporations, reflecting the severity of non-compliance with customs regulations. Additionally, the Act includes provisions for both civil and criminal penalties, ensuring that breaches of customs laws are addressed appropriately.