EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0811503
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.
Lincon Recruitments Pty Ltd applied for a TCO in respect of certain hydraulic elevating platforms on 05 June 2008.
Instrument
TCO No 0811503 was made on 02 September 2008. It declares that those certain hydraulic elevating platforms 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. 0811503 is taken to have come into force on 05 June 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, introduces a framework for the creation of Tariff Concession Orders (TCOs) under Part XVA. This legislative provision allows for the application of lower rates of customs duty on specific goods, provided certain criteria are met. The Act aims to facilitate tariff concessions by enabling applicants, such as Lincon Recruitments Pty Ltd, to apply for reduced customs duties on goods that are not produced domestically and for which no suitable substitutes are available. The policy objective is to support industries by making imported goods more competitively priced against locally produced alternatives. Instrument No. 0811503, issued on 02 September 2008, exemplifies this by applying a zero duty rate to certain hydraulic elevating platforms, as no substitutable goods were produced in Australia at the time of the application. The TCO became effective from the date the application was lodged, 05 June 2008, without imposing any liabilities on individuals or entities other than the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0811503 applies to goods specified in the instrument, namely certain hydraulic elevating platforms, and is governed under the Customs Act 1901, specifically Part XVA, which details the process for Tariff Concession Orders (TCOs). This Act applies to individuals or entities that wish to import these specific goods into Australia and seek reduced customs duty rates as provided by a TCO. The application of the Act is federal, extending across the Commonwealth of Australia. The instrument does not apply to goods specified in section 269SJ of the Customs Act 1901, which outlines goods ineligible for a TCO. The Act’s application can be further extended or restricted through subordinate instruments, which may provide additional criteria or details on the types of goods eligible for tariff concessions. The TCO in question was issued on 02 September 2008, following an application by Lincon Recruitments Pty Ltd on 05 June 2008, and it became effective on the date of the application, as stipulated by the Act.
Key Provisions
The key provisions of the Tariff Concession Instrument No. 0811503 under the Customs Act 1901 (section 269C, 269P(3), and 269SJ) enable the Chief Executive Officer of Customs (CEO) to make a Tariff Concession Order (TCO) for certain hydraulic elevating platforms. This order reduces the customs duty on these goods from a general rate of 5% to zero, provided the CEO is satisfied that no substitutable goods are produced in Australia in the ordinary course of business (section 269D and 269E). The TCO applies to goods for which an application was lodged on 05 June 2008, and it is effective as of that date (section 269S(1)).
The obligations imposed by this legislation on parties and entities include the requirement for applicants, such as Lincon Recruitments Pty Ltd, to ensure their applications for TCOs meet the core criteria set out in the Act. Specifically, applicants must demonstrate that no substitutable goods are produced in Australia, and the CEO must be satisfied with the application's validity. Additionally, the CEO has an obligation to publish a notice in the Gazette inviting submissions from any person who might object to the TCO being made (subsection 269K(1)).
Failure to comply with the provisions of the Customs Act 1901, or any associated regulations, could lead to various legal consequences. For example, if an entity fails to meet the criteria for a TCO application, or if they provide false information in their application, they could face administrative penalties. While specific penalties are not detailed in the explanatory statement, breaches of customs legislation typically incur fines and potential legal action under the Customs Act 1901. The exact penalties would depend on the nature and severity of the breach.
In summary, Tariff Concession Instrument No. 0811503 provides a pathway for reducing customs duties on specific goods, provided certain conditions are met. It imposes clear obligations on applicants and the CEO to ensure the proper application and enforcement of the tariff concessions. Breaches of these obligations could lead to legal consequences, including fines and other penalties under the Customs Act 1901.