EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0802669
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.
Parker Hannifin Pty Limited applied for a TCO in respect of certain hydraulic hose wire on 08 April 2008.
Instrument
TCO No 0802669 was made on 04 July 2008. It declares that those certain hydraulic hose wires 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. 0802669 is taken to have come into force on 08 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 by the Australian Parliament to regulate the importation of goods into Australia. The Act provides a framework for the imposition of customs duties and other charges on imported goods, and includes provisions for tariff concessions. The Tariff Concession Instrument No. 0802669 was made under the Customs Act 1901 to provide a tariff concession for certain hydraulic hose wires imported by Parker Hannifin Pty Limited. The concession reduces the duty on these goods from 5% to free. The instrument was made by the Chief Executive Officer of Customs after considering an application from the importer and determining that no substitutable goods were produced in Australia. The instrument came into force on the date the application was lodged, and does not affect the rights of any person other than the Commonwealth. The policy objective of the Customs Act 1901 and associated tariff concession instruments is to promote trade and industry in Australia by providing a predictable and transparent customs regime.
Scope and Application
The Customs Act 1901, specifically under Part XVA, establishes a framework for the Chief Executive Officer of Customs (CEO) to issue Tariff Concession Orders (TCOs), which provide lower rates of customs duty for certain goods. An application for a TCO can be made by any person, and if the CEO determines that the application meets the core criteria, including the absence of substitutable goods produced in Australia, a TCO can be issued. This order specifies the reduced duty rate applicable to the designated goods. The CEO must also publish a notice in the Gazette inviting submissions from any interested parties before making a decision, although no submissions were received in the case of TCO No. 0802669. This particular TCO applies to certain hydraulic hose wires and came into effect on the date of application, 8 April 2008, without imposing any liabilities or disadvantaging any person other than the Commonwealth. Instead, it provides potential benefits to importers who can apply for a refund of duty on goods imported since the TCO's effective date.
Key Provisions
The main operative sections of this legislation are sections 269C, 269B, 269D, 269E, 269F, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO) in respect of certain goods. If the CEO is satisfied that the application meets the core criteria outlined in section 269C, they must make a written order, known as a TCO, declaring that the goods in question are subject to a specific rate of customs duty (section 269P(3)). The TCO in this case, No. 0802669, applies to certain hydraulic hose wires and specifies that the rate of duty on these goods is free, as opposed to the general rate of 5% (section 269S(1)).
The Customs Act 1901 imposes certain obligations on the parties involved. Firstly, the CEO must ensure that the application for a TCO is not in respect of goods specified in section 269SJ, which lists those goods that cannot be subject to a TCO. The CEO must also consider whether the application meets the core criteria, specifically that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (section 269C). Additionally, the CEO must publish a notice in the Gazette inviting any person who considers there are reasons why the TCO should not be made to lodge a submission (subsection 269K(1)). If no submissions are received, the CEO can proceed to make the TCO.
Failure to comply with the requirements of the Customs Act 1901 can result in various penalties and consequences. However, the explanatory statement does not specify any particular offences or penalties related to the making of a TCO. The Act and associated regulations govern the broader customs and tariff processes, and any breaches of these could result in civil or criminal penalties as outlined elsewhere in the legislation. The key focus of this particular TCO is on ensuring that eligible goods receive the appropriate tariff concessions without imposing liabilities or disadvantaging any person other than the Commonwealth.