EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0815150
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.
Mtmg Australia applied for a TCO in respect of certain hand trolleys on 30 June 2008.
Instrument
TCO No 0815150 was made on 19 September 2008. It declares that those certain hand trolleys 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. 0815150 is taken to have come into force on 30 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 was enacted by the Australian Parliament to regulate customs and border control, and to provide for the imposition of duties and taxes on imported goods. The Act was introduced to address the need for a comprehensive legal framework governing the importation of goods into Australia, ensuring that customs duties and taxes are properly collected and managed. The explanatory statement for Tariff Concession Instrument No. 0815150, made under the Customs Act 1901, illustrates the process by which the Chief Executive Officer of Customs can grant tariff concessions on specific goods, provided certain criteria are met. In this instance, the instrument was made to address an application by Mtmg Australia for tariff concessions on certain hand trolleys, resulting in a reduction of the duty rate from the general rate of 5% to free. The policy objective, as set out in the Act, is to facilitate trade by reducing the cost of importing certain goods, thereby encouraging economic activity and supporting Australian businesses.
Scope and Application
The Tariff Concession Instrument No. 0815150, pursuant to the Customs Act 1901, applies to individuals or entities that have applied for and been granted a Tariff Concession Order (TCO) for specific goods. This instrument specifically addresses the application of customs duties on certain hand trolleys, which Mtmg Australia sought to have recognised under the scheme. The Act applies to the Chief Executive Officer of Customs who is responsible for making TCOs and determining whether applications meet the core criteria, such as the absence of substitutable goods produced in Australia. The geographic reach of this Act is national, as it is a Commonwealth Act, impacting all states and territories within Australia. The Act does not apply to goods specified in section 269SJ of the Customs Act, which lists those goods that cannot be subject to a TCO. The application of the Act may be extended or restricted through subordinate instruments, which could include further specifications or conditions set out in related regulations or orders.
Key Provisions
The main operative sections of this legislation involve the process of applying for, making, and implementing a Tariff Concession Order (TCO) under the Customs Act 1901. According to section 269F, a person may apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of goods, provided the goods are not specified in section 269SJ as ineligible for a TCO. Section 269C outlines the core criteria that an application must meet, specifically that no substitutable goods were produced in Australia on the day the application was lodged. If these criteria are satisfied, the CEO must make a written order under section 269P(3) declaring that the goods are subject to a prescribed tariff concession, thereby reducing or eliminating the customs duty on those goods.
The Act imposes several obligations on the parties involved. Firstly, the CEO is required to assess whether an application meets the core criteria (section 269C). If the CEO is satisfied that the application meets these criteria and no substitutable goods were produced in Australia, the CEO must make a written TCO (section 269P(3)). Additionally, under subsection 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made. This ensures transparency and allows for any objections to be considered before the order is made.
Breaching the provisions of the Customs Act 1901 can lead to various consequences. If a person knowingly provides false or misleading information in an application for a TCO, they may be subject to penalties under the relevant sections of the Act. The maximum penalties for providing false or misleading information can include substantial fines and, in some cases, imprisonment. Additionally, any person found to be in breach of the conditions set by a TCO may also face penalties, including financial penalties and possible legal action. The specific penalties depend on the nature and severity of the breach but can include fines and imprisonment as stipulated in the Customs Act 1901.