EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0833986
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.
Australian Freyssinet Pty Ltd applied for a TCO in respect of certain incremental bridge launching system on 02 October 2008.
Instrument
TCO No 0833986 was made on 19 December 2008. It declares that those certain incremental bridge launching system 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. 0833986 is taken to have come into force on 02 October 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 need for a streamlined process to reduce customs duty on specific goods, thereby fostering trade and economic growth. This Act allows the Chief Executive Officer of Customs to create Tariff Concession Orders (TCOs), which provide a lower rate of customs duty for goods that meet certain criteria. The underlying policy objective is to enhance Australia's competitiveness by reducing the cost of importing goods that are not produced domestically and for which no suitable domestic substitutes exist. This legislative framework ensures that businesses can access necessary goods at a reduced cost, thus supporting economic activity and international trade. The Tariff Concession Instrument No. 0833986, made under this Act, exemplifies its application by providing a tariff concession for certain incremental bridge launching systems, effectively reducing their customs duty rate from 5% to free.
Scope and Application
The Customs Act 1901 applies to all persons and entities involved in the importation of goods into Australia, specifically within the framework of tariff concession orders (TCO). The Act allows for the reduction or elimination of customs duty on certain goods under specific conditions, as outlined in Part XVA. An application for a TCO can be made by any person to the Chief Executive Officer of Customs (CEO), who will assess whether the application meets the core criteria, particularly whether no substitutable goods are produced in Australia in the ordinary course of business. This process applies across the Commonwealth of Australia, ensuring a consistent approach to tariff concessions nationwide. However, certain goods, as specified in section 269SJ of the Act, are excluded from tariff concessions, and no submissions were received opposing the issuance of TCO No. 0833986 for the incremental bridge launching system. The TCO does not retroactively affect any existing rights or liabilities of persons other than the Commonwealth and does not impose any new liabilities.
Key Provisions
The Customs Act 1901, through its Part XVA, allows the Chief Executive Officer of Customs (CEO) to make Tariff Concession Orders (TCOs) which reduce the rate of customs duty on certain goods. Section 269F of the Act enables an application for a TCO, provided the goods in question are not listed in section 269SJ, which specifies goods ineligible for TCOs. To meet the core criteria, the CEO must ensure, as per section 269C, that no substitutable goods were produced in Australia on the day the application was lodged. 'Substitutable goods' are defined in section 269D and must correspond in use to the goods for which the TCO is sought. If the CEO determines that the application meets these criteria, they are mandated, under section 269P(3), to issue a TCO, specifying the applicable tariff item from Schedule 4 of the Customs Tariff Act 1995. In this particular case, Tariff Concession Order No. 0833986, issued on 19 December 2008, declares that certain incremental bridge launching systems are subject to item 50 of the Tariff, with a duty rate of free, as no substitutable goods were produced in Australia.
The obligations under this Act for entities such as Australian Freyssinet Pty Ltd involve ensuring their TCO applications are submitted in accordance with section 269F. The CEO must then verify, as per section 269C, that no substitutable goods were produced in Australia on the date of application. If these conditions are met, the CEO must proceed to issue a TCO as per section 269P(3). Furthermore, the CEO is required under subsection 269K(1) to publish a notice in the Gazette, inviting any interested parties to submit objections if they believe the TCO should not be granted. In this instance, no objections were received, facilitating the smooth issuance of the TCO.
Breaching the provisions of the Customs Act 1901, specifically regarding TCOs, could result in civil or criminal consequences. Although the specific penalties are not detailed in the provided text, general provisions under the Act may impose fines and other penalties for non-compliance. For instance, knowingly making a false statement or providing misleading information in a TCO application could lead to substantial fines and, in severe cases, imprisonment. The exact penalties would depend on the nature and severity of the breach, as outlined in other sections of the Act and relevant regulations.