Overview

The Tariff Concession Instrument No. 0829125, issued under the Customs Act 1901, was enacted to provide a tariff concession for specific bus chassis. The Act, enacted by the Australian Parliament, aims to facilitate trade by reducing customs duty on goods that are not produced domestically or for which there are no suitable substitutes available in Australia. This instrument was introduced to address the gap where certain imported goods, in this case, bus chassis, faced higher customs duties due to the absence of local production or viable alternatives. The Tariff Concession Order (TCO) was issued by the Chief Executive Officer of Customs, who determined that the application met the core criteria, namely that no substitutable goods were produced in Australia, thereby entitling the specified bus chassis to a tariff rate of free duty. The policy objective of this measure is to promote economic efficiency and support the import of goods that cannot be adequately met by domestic production.

Scope and Application

The Customs Act 1901, through Part XVA, establishes a framework for the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that lower the customs duty on certain goods. This mechanism applies to goods specified in a TCO application, provided they meet the core criteria stipulated in section 269C of the Act. Notably, these criteria include a condition that no substitutable goods are produced in Australia in the ordinary course of business at the time the application is lodged. The Act excludes from TCO consideration any goods specified in section 269SJ. Once an application meets the criteria, a TCO is made under section 269P, which specifies the prescribed item of Schedule 4 to the Customs Tariff Act 1995, thereby establishing the reduced rate of duty. This process ensures that the application is subjected to public consultation as required by section 269K before a TCO is finalised. The application of TCO No. 0829125, effective from 29 August 2008, exemplifies this process by reducing the duty on certain bus chassis from 5% to free, following an application by Trucks Australia Ltd.

Key Provisions

The main operative sections of the Tariff Concession Instrument No. 0829125 are sections 269C, 269B, 269D, 269E, and 269P. Section 269C (1) stipulates that a Tariff Concession Order (TCO) application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B defines the meaning of "goods produced in Australia," "ordinary course of business," and "substitutable goods." Section 269D provides that if the Chief Executive Officer of Customs (CEO) is satisfied that the application meets the core criteria, the CEO must make a written order (a TCO) declaring that the goods subject of the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies. Section 269E defines the term "ordinary course of business," and Section 269P (3) 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 Tariff applies. The obligations and requirements imposed by this Act on the parties or entities it governs include the requirement that 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 Tariff applies. The CEO must also ensure that the application meets the core criteria and that no substitutable goods were produced in Australia in the ordinary course of business. The CEO must also publish a notice in the Gazette, inviting any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. The CEO must ensure that 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 Act also imposes penalties for breach of the provisions of the TCO. Any person who contravenes a provision of the TCO may be liable to a civil penalty of up to $22,200 per offence for an individual and up to $111,000 per offence for a body corporate. The Act also provides for the imposition of fines and imprisonment for criminal offences related to the contravention of the TCO provisions. The maximum penalty for an individual is imprisonment for two years, a fine of up to $22,200, or both. For a body corporate, the maximum penalty is a fine of up to $111,000. The Act also provides for the recovery of costs associated with the enforcement of the TCO provisions.