EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0803009
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.
Sandvik Shark Pty Ltd applied for a TCO in respect of certain bucket loader parts on 21 February 2008.
Instrument
TCO No 0803009 was made on 02 May 2008. It declares that those certain bucket loader parts 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. 0803009 is taken to have come into force on 21 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 Tariff Concession Instrument No. 0803009, enacted under the Customs Act 1901, was introduced to address the need for tariff concessions for specific goods, thereby facilitating more competitive and efficient importation processes. The instrument was made on 2 May 2008 and came into force on 21 February 2008, the date the application was lodged by Sandvik Shark Pty Ltd for certain bucket loader parts. The primary policy objective is to reduce the customs duty on these goods, providing economic benefits to importers by allowing them to apply for refunds of duties paid prior to the instrument's effective date. The instrument was enacted by the Chief Executive Officer of Customs, who was satisfied that the application met the core criteria and that no substitutable goods were produced in Australia at the time. The instrument does not disadvantage or impose liabilities on any person except the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0803009, which amends the Customs Act 1901, applies to Sandvik Shark Pty Ltd's application for tariff concession orders (TCO) concerning specific bucket loader parts. The Act allows the Chief Executive Officer of Customs (CEO) to grant TCOs that reduce the rate of customs duty on goods, provided the application meets the core criteria outlined in the Act and the goods are not excluded under section 269SJ. The CEO must determine that no substitutable goods are produced in Australia in the ordinary course of business, as defined in sections 269D and 269E of the Act, before issuing a TCO. The CEO was satisfied that the application for these bucket loader parts met the necessary criteria, resulting in the declaration that they qualify for a free duty rate under item 50 of Schedule 4 to the Customs Tariff Act 1995. This TCO applies nationally across Australia and became effective from 21 February 2008, the date the application was lodged. The instrument does not disadvantage any person other than the Commonwealth or impose new liabilities on anyone.
Key Provisions
The primary operative sections of this legislation, specifically Tariff Concession Instrument No. 0803009, revolve around the Customs Act 1901. Section 269F enables an application for a Tariff Concession Order (TCO) to be made to the Chief Executive Officer of Customs (CEO). If the CEO determines that the application is not in respect of goods that cannot be subject to a TCO as outlined in section 269SJ, they must assess whether the application meets the core criteria (section 269C). If satisfied, the CEO must make a written order (a TCO) (section 269P(3)). This TCO declares that the specified goods are subject to a prescribed rate of customs duty as set out in Schedule 4 to the Customs Tariff Act 1995.
The Act imposes several obligations on the parties involved. Firstly, the CEO is required to assess TCO applications against the core criteria to ensure that no substitutable goods are produced in Australia (section 269C). Once the CEO is satisfied that the application meets the core criteria, they must promptly make a written order (section 269P(3)). Additionally, as per section 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any interested parties who believe the TCO should not be made. If no submissions are received, the CEO proceeds with making the TCO. The Act ensures that the rights of persons (other than the Commonwealth) as at the date of registration are not disadvantaged by the TCO and that no liabilities are imposed on any person for actions taken prior to the TCO's registration.
In terms of breaches and consequences, the legislation does not explicitly outline specific offences or penalties within the explanatory statement. However, it is implied that any misuse or incorrect application of the TCO could result in legal challenges or administrative reviews. The Act ensures that the rights of importers are beneficially affected, and under paragraph 126(1)(r) of the Regulations, importers can apply for a refund of duty on goods imported since the TCO came into force. Any non-compliance with the terms of the TCO could potentially lead to civil or administrative consequences, although the exact penalties are not specified within the provided text.