EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0816640
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.
U R Machinery applied for a TCO in respect of certain grape harvesters on 08 July 2008.
Instrument
TCO No 0816640 was made on 24 March 2009. It declares that those certain grape harvesters 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. 0816640 is taken to have come into force on 08 July 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 to provide a comprehensive framework for the regulation of customs and excise, including the administration of customs duty and the facilitation of trade. This Act was introduced to address the need for a streamlined process to provide tariff concessions on certain imported goods, which was previously lacking. The Tariff Concession Instrument No. 0816640, enacted in 2009, is an instrument under this Act that aims to provide tariff concessions for specific goods, thereby reducing the customs duty payable on them. The instrument was introduced following an application by U R Machinery for tariff concessions on certain grape harvesters, which the Chief Executive Officer of Customs approved after determining that no substitutable goods were produced in Australia. The policy objective of this instrument is to provide relief to importers by reducing the customs duty on specific goods, which in turn may lower the cost of imported goods and stimulate trade.
Scope and Application
The Tariff Concession Instrument No. 0816640 under the Customs Act 1901 applies to the process of granting tariff concessions for specific goods, in this case certain grape harvesters. This legislation allows for the reduction or elimination of customs duty on these goods if it is determined that no substitutable goods are produced in Australia. The instrument is specifically targeted at entities and individuals involved in the importation of these goods, offering them a reduced tariff rate, which in this instance is set at zero percent, thereby benefiting importers. Geographically, this Act applies across the Commonwealth of Australia and is administered by the Chief Executive Officer of Customs. The Act does not specify any exclusions or exemptions beyond the criteria outlined in section 269SJ of the Customs Act 1901, which details goods that cannot be subject to a tariff concession order. The instrument’s application can be further detailed or modified through subordinate instruments, as permitted under the overarching Customs Act 1901 framework.
Key Provisions
The main sections of the Customs Act 1901 relevant to Tariff Concession Orders (TCOs) include sections 269C, 269B, 269D, 269E, 269F, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. The CEO must determine if the application meets the core criteria outlined in sections 269C and 269B, which require that no substitutable goods were produced in Australia on the day the application was lodged and that the goods in question are not specified in section 269SJ of the Act. If the CEO is satisfied that the application meets these criteria, they must make a written order (TCO) declaring the goods subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The Customs Act imposes specific obligations on both the applicant and the CEO. For applicants, the key obligation is to ensure that their application is complete and meets the core criteria for a TCO. This involves demonstrating that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. The CEO, on the other hand, has the obligation to review the application and determine whether it meets the required criteria. If satisfied, the CEO must make a written TCO and publish a notice in the Gazette inviting any objections or submissions. In this case, no submissions were received in response to the notice published for TCO No. 0816640.
The Act does not explicitly state specific offences or penalties for failing to comply with the TCO provisions. However, non-compliance or improper application could potentially lead to civil or administrative consequences. For instance, if an entity submits an incomplete or false application, this could result in the TCO not being granted, potentially leading to higher customs duties for the goods in question. Additionally, if a person is found to have acted in bad faith or provided misleading information during the application process, they may face legal action or penalties under related legislation, although these are not detailed within the TCO itself.
TCO No. 0816640, which was made on 24 March 2009, specifies that certain grape harvesters are subject to a free rate of duty instead of the general rate of 5%. This TCO came into effect on the date the application was lodged, 08 July 2008. Importantly, the TCO does not affect the rights of any person other than the Commonwealth and does not impose any liabilities on any person in respect of actions taken before the TCO was registered. Importers of the specified goods can apply for a refund of duty on goods imported since the TCO came into force.