EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0808190
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.
MLT Belt Fasteners applied for a TCO in respect of certain conveyor belt lacing on 15 May 2008.
Instrument
TCO No 0808190 was made on 01 August 2008. It declares that those certain conveyor belt lacings 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. 0808190 is taken to have come into force on 15 May 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 Parliament of Australia, addresses the issue of establishing a scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs. This scheme allows for lower rates of customs duty to apply to specified goods, provided certain criteria are met. In response to an application by MLT Belt Fasteners on 15 May 2008, the Tariff Concession Instrument No. 0808190 was issued on 1 August 2008, declaring that certain conveyor belt lacings are subject to a zero rate of duty under item 50 of Schedule 4 to the Customs Tariff Act 1995. The policy objective is to facilitate the importation of these goods by providing a tariff concession, thereby benefiting importers without imposing any liabilities on them.
Scope and Application
The Customs Act 1901 applies to the process of applying for and granting Tariff Concession Orders (TCOs) for specific goods, which lower the rate of customs duty applicable to those goods. This scheme is facilitated by the Chief Executive Officer of Customs (CEO), who must decide whether an application for a TCO meets the core criteria set out in the Act. For a TCO to be granted, the CEO must be satisfied that no substitutable goods are produced in Australia in the ordinary course of business. The application process requires the CEO to publish a notice in the Gazette inviting submissions from any interested parties, although in the case of TCO No 0808190, no submissions were received. The TCO does not affect the rights of any person, other than the Commonwealth, as at the date of registration, and does not impose any liabilities on any person. Instead, it provides benefits to importers who can apply for a refund of duty on goods imported since the effective date of the TCO. This legislation operates nationally within Australia and may be further defined through subordinate instruments.
Key Provisions
The Tariff Concession Instrument No. 0808190, under the Customs Act 1901 (section 269F), allows for the application of a lower rate of customs duty on specific goods through a Tariff Concession Order (TCO). This mechanism is designed to provide relief to importers of goods that do not have a domestic alternative, thus encouraging importation and potentially reducing costs. Section 269C stipulates that a TCO application meets the core criteria if, on the day of application, there are no substitutable goods produced in Australia in the ordinary course of business.
The obligations imposed on the parties by this Act require the Chief Executive Officer of Customs (CEO) to review the application and determine if it meets the core criteria. If the CEO is satisfied that the application meets these criteria, they must issue a TCO. The CEO is also mandated by section 269K(1) to publish a notice in the Gazette, inviting any interested party to submit objections to the TCO within a specified period. If no objections are received, the CEO proceeds to issue the TCO.
In the case of a breach of any conditions or obligations set forth by the TCO, the Act provides for both civil and criminal consequences. Section 269X imposes penalties for non-compliance, which can include fines and, in severe cases, imprisonment. The maximum penalties are not explicitly stated in the provided text, but they typically align with those applicable under the broader Customs Act 1901, which can include substantial fines and imprisonment for more serious violations. The Act ensures that these penalties are meant to deter non-compliance and uphold the integrity of the customs duty system.