EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0802710
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.
Carr Australia Pty Ltd applied for a TCO in respect of certain eyelet and washer machine on 8 April 2008.
Instrument
TCO No 0802710 was made on 20 June 2008. It declares that those certain eyelet and washer machine 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. 0802710 is taken to have come into force on 8 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, enacted by the Commonwealth Parliament, provides a framework for the regulation of imports and exports through customs duties and other measures. Specifically, Part XVA of the Act allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which can reduce the customs duty on certain goods. This mechanism was introduced to address situations where imported goods do not have substitutable Australian-produced alternatives, thereby encouraging the import of goods that cannot be efficiently or economically produced domestically. In line with the policy objective of facilitating trade and supporting industry, the Customs Act enables the CEO to make TCOs if certain criteria are met, such as the absence of substitutable goods produced in Australia. The process involves an application by interested parties, assessment by the CEO, and potential public consultation before the order is issued.
In the case of Tariff Concession Instrument No. 0802710, the CEO granted a concession for certain eyelet and washer machines on 20 June 2008, following an application by Carr Australia Pty Ltd on 8 April 2008. The CEO determined that no substitutable goods were produced in Australia, thereby meeting the core criteria outlined in the Act. Consequently, these specific eyelet and washer machines now attract a zero duty rate under item 50 of Schedule 4 to the Customs Tariff Act 1995, down from the general rate of 5%. The concession is effective from the date the application was lodged, 8 April 2008, and does not impose any liabilities on persons other than the Commonwealth, while potentially benefiting importers by allowing them to apply for duty refunds on imports made since the concession's effective date.
Scope and Application
The Tariff Concession Instrument No. 0802710, made under the Customs Act 1901, applies to the particular eyelet and washer machines that Carr Australia Pty Ltd applied for a tariff concession on. This legislation impacts the importation of these specific goods by providing a zero rate of customs duty, as opposed to the general rate of 5%. The application of this instrument is confined to the goods specified and does not extend to other products or industries. The scope of this legislation is national, falling under the purview of the Commonwealth as per the Act. There are no exclusions or exemptions noted within the instrument itself; however, section 269SJ of the Act specifies that certain goods cannot be subject to a tariff concession order. The instrument is effective from the date the application was lodged, 8 April 2008, and does not disadvantage or impose liabilities on any person in respect of actions taken before its effective date.
Key Provisions
The primary sections of the Tariff Concession Instrument No. 0802710 under the Customs Act 1901 (section 269F) establish the process by which applications for Tariff Concession Orders (TCOs) are submitted and evaluated by the Chief Executive Officer of Customs (CEO). Specifically, section 269C stipulates that a TCO application must meet core criteria, which include the absence of substitutable goods produced in Australia at the time of application, as defined in section 269D (section 269B and 269E). If the CEO is satisfied that these criteria are met, a written order is issued, declaring that the goods in question are subject to a specified lower rate of duty outlined in the Customs Tariff Act 1995 (Schedule 4, item 50).
The obligations imposed by the Act on parties or entities include the submission of a valid application to the CEO for a TCO (section 269F). The CEO, in turn, is obligated to assess the application against the core criteria (section 269C), publish a notice in the Gazette inviting submissions from interested parties (subsection 269K(1)), and make a decision based on the submissions received. Additionally, upon the issuance of a TCO, importers of the affected goods can apply for a refund of duties paid on those goods imported since the effective date of the TCO (paragraph 126(1)(r) of the Regulations).
In terms of penalties and consequences for breach, the Act does not explicitly outline specific offences or penalties related to the non-compliance with the TCOs. However, general provisions within the Customs Act 1901 may apply to any breaches of customs regulations. Typically, breaches can lead to civil or criminal penalties, including fines or imprisonment, depending on the severity and intent behind the breach. The exact penalties would be determined by the relevant provisions of the Customs Act 1901 and any applicable regulations or subsidiary legislation.