EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0803932
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.
The Trustee For Nanduri Family Trust applied for a TCO in respect of certain dc motors on 12 March 2008.
Instrument
TCO No 0803932 was made on 06 June 2008. It declares that those certain dc motors 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. 0803932 is taken to have come into force on 12 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 Tariff Concession Instrument No. 0803932 was enacted in 2008 under the Customs Act 1901 to provide tariff concessions for certain dc motors, thereby addressing the need for reduced customs duty rates on these specific goods. This instrument was developed in response to an application by the Trustee For Nanduri Family Trust, which sought tariff concessions for these dc motors. The instrument was created by the Chief Executive Officer of Customs, following the core criteria set out in the Customs Act 1901. The primary objective of this legislation is to provide tariff relief on certain goods, in this case dc motors, by reducing the customs duty rate from the general rate of 5% to free, thereby benefiting the rights of importers.
The instrument was introduced without any public submissions against it, and it came into force on 12 March 2008, the date on which the application was lodged. Importantly, the Tariff Concession Instrument No. 0803932 does not affect the rights of any person, other than the Commonwealth, in a way that would disadvantage them or impose liabilities for actions taken before the date of registration. This ensures that the legislation operates within the confines of the Customs Act 1901, without adversely impacting any party.
Scope and Application
The Tariff Concession Instrument No. 0803932, made under Part XVA of the Customs Act 1901, applies to individuals or entities that seek tariff concessions on specific goods. The instrument was created in response to an application by the Trustee For Nanduri Family Trust concerning certain dc motors, which were deemed eligible for a tariff concession as no substitutable goods were being produced in Australia at the time. The instrument was made effective from 12 March 2008, the date the application was lodged, and it reduces the duty on the specified dc motors from a general rate of 5% to zero. This instrument operates within the national jurisdiction of Australia and is applicable to the particular goods specified in the instrument. The instrument does not apply to goods outlined in section 269SJ of the Customs Act 1901, which are ineligible for tariff concessions. The scope of the instrument may be extended or modified through subordinate instruments, which would be created in accordance with the provisions of the Customs Act 1901.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 0803932 are sections 269C, 269P, and 269SJ of the Customs Act 1901 (the Act). Section 269C sets out the core criteria for a Tariff Concession Order (TCO) application to be valid, requiring that no substitutable goods were produced in Australia on the day the application was lodged. Section 269P(3) mandates that if these criteria are met, the Chief Executive Officer of Customs (the CEO) must issue a written order declaring the goods eligible for a tariff concession. Section 269SJ identifies goods that cannot be subject to a TCO, thus limiting the scope of the concession.
The Act imposes several obligations and requirements on parties applying for a TCO. Firstly, applicants must ensure that their applications are made in good faith and meet the core criteria as outlined in section 269C. This involves demonstrating that no substitutable goods were produced in Australia. Furthermore, applicants must provide all necessary information to the CEO to facilitate a thorough assessment. Once an application is accepted, the CEO is required to publish a notice in the Gazette inviting submissions from any interested parties, as stipulated in subsection 269K(1). The CEO must then consider any submissions received before making a final decision.
Failure to comply with the provisions of the Customs Act 1901 can result in various civil and criminal consequences. Although the explanatory statement does not detail specific offences or penalties, breaches of customs regulations generally attract fines and potential imprisonment under Australian law. For instance, knowingly making a false statement or representation in a TCO application could lead to prosecution and penalties as prescribed by the Crimes Act 1914. Additionally, any individual or entity found to have acted in bad faith or provided misleading information could face civil actions, including claims for damages or injunctions.
The Tariff Concession Instrument No. 0803932 itself does not specify particular penalties but aligns with the broader framework of the Customs Act 1901. This means that any breach of the Act, including the provisions related to TCOs, could lead to significant legal ramifications. For instance, under section 234 of the Act, an individual found guilty of an offence against the Act could be liable to a penalty of up to $22,200 or imprisonment for up to two years, or both, for each offence. Furthermore, the Act empowers customs officers to seize goods involved in an offence, adding another layer of enforcement against non-compliance.
In summary, the Tariff Concession Instrument No. 0803932, along with the relevant sections of the Customs Act 1901, establishes a clear framework for the application and approval of tariff concessions on specified goods. The obligations on applicants and the CEO ensure a transparent and fair process, while the potential civil and criminal consequences for non-compliance underscore the seriousness with which these regulations are regarded.