EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0803690
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.
Doppelmayr Australia Pty Ltd applied for a TCO in respect of certain ski lift conveyor on 06 March 2008.
Instrument
TCO No 0803690 was made on 30 May 2008. It declares that those certain ski lift conveyors 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. 0803690 is taken to have come into force on 06 March 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 provide for the collection of customs duty and the regulation of the import and export of goods. The Act was amended to include the Tariff Concession Orders (TCOs) scheme under Part XVA, which allows for lower rates of customs duty on specified goods. This scheme was introduced to address the gap in ensuring that certain imported goods that are not produced domestically, and for which there are no substitutable domestic goods, are subject to fair customs duty rates. The policy objective is to encourage trade and investment by providing relief from customs duty on imported goods that are not produced in Australia and for which there are no suitable domestic alternatives. The Tariff Concession Instrument No. 0803690 was made under this scheme on 30 May 2008, in response to an application by Doppelmayr Australia Pty Ltd for a TCO on certain ski lift conveyors. The instrument declares that these goods are subject to a free rate of duty, effective from 06 March 2008, the date the application was lodged.
Scope and Application
The Tariff Concession Instrument No. 0803690 under the Customs Act 1901 applies to the specific goods identified in the instrument, in this case, certain ski lift conveyors, which benefit from a concession in customs duty. The Act allows the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that apply to goods for which no substitutable goods are produced in Australia, thereby ensuring that local production is not unfairly disadvantaged. The scope of the Act extends to any person or entity that applies for a TCO and is subject to the core criteria stipulated in the Act. This particular TCO was made following an application by Doppelmayr Australia Pty Ltd, and no submissions opposing the TCO were received, indicating broad acceptance or lack of opposition to the concession. The geographic reach of the Act is national, as it is a Commonwealth Act, thereby applying uniformly across Australia. There are no stated exclusions or exemptions in the instrument itself, but it is subject to the broader provisions of the Customs Act 1901 and the Customs Tariff Act 1995, which may impose additional conditions or limitations. The application of the Act may also be extended or further defined through subordinate instruments, such as regulations or guidelines issued by the CEO.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0803690 (referred to as the TCO) establish the parameters for the application of a tariff concession order under the Customs Act 1901 (section 269F). When an application for a TCO is made, the Chief Executive Officer of Customs (the CEO) must decide whether the application meets the core criteria specified in sections 269C and 269P(3). If these criteria are satisfied, the CEO must issue a written TCO, as outlined in section 269P(3), which specifies the goods to which the concession applies and the corresponding duty rate under the Customs Tariff Act 1995.
The Act imposes certain obligations on the parties involved in the TCO process. For instance, section 269K(1) mandates the CEO to publish a notice in the Gazette once a TCO application is accepted as valid, inviting any interested parties to submit their views on why the TCO should not be granted. In the case of TCO No. 0803690, no submissions were received in response to this invitation. Furthermore, section 269S(1) stipulates that a TCO comes into force on the date the application is lodged. The TCO does not retroactively affect the rights of any person, except to the extent that it might benefit importers by allowing them to apply for a refund of duty paid on goods imported since the TCO's effective date, as per paragraph 126(1)(r) of the Regulations.
Breach of the provisions within the Customs Act 1901, including the TCO process, can lead to various consequences. While the explanatory statement does not specify offences or penalties directly related to the TCO process, breaches of the Act generally can result in both civil and criminal penalties. Civil penalties might include fines up to a certain maximum amount, as determined by the relevant sections of the Act. Criminal penalties could also apply, potentially resulting in imprisonment, depending on the nature and severity of the breach. The exact penalties would be determined by the specific provisions of the Customs Act 1901 and any related regulations.