EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0834339
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.
Hitachi Construction Material Pty Ltd applied for a TCO in respect of certain track laying excavator parts on 07 October 2008.
Instrument
TCO No 0834339 was made on 12 January 2009. It declares that those certain track laying excavator parts 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. 0834339 is taken to have come into force on 07 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 Australian Parliament, provides a framework for managing tariffs on imported goods, including provisions for tariff concession orders (TCOs) under Part XVA. These concessions aim to reduce the duty on specific goods, promoting economic efficiency and competitiveness. The Tariff Concession Instrument No. 0834339, issued in 2009, was introduced to address a specific need identified by Hitachi Construction Material Pty Ltd for tariff concessions on certain track laying excavator parts. The instrument was made following an application where the Chief Executive Officer of Customs determined that no substitutable goods were produced in Australia, meeting the core criteria for concession. The policy objective of this instrument is to facilitate the importation of these parts at a reduced duty rate of free, compared to the general rate of 5%, thereby supporting the operational needs of the applicant and potentially benefiting the broader market.
Scope and Application
The Customs Act 1901, through its Part XVA, establishes a framework for the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, enabling the application of a reduced rate of customs duty on specified goods. A TCO is available for goods not listed in section 269SJ of the Act, provided that the application meets the core criteria outlined in section 269C, which stipulates that no substitutable goods were produced in Australia in the ordinary course of business on the date the application was lodged. This Act applies to any person or entity that applies for a TCO for goods, and it covers the import of specified goods across the Commonwealth of Australia. The application of a TCO does not affect any existing rights of persons, other than the Commonwealth, ensuring that no disadvantage or new liabilities are imposed as a result of the TCO. Furthermore, importers may benefit from the TCO by applying for a refund of duties paid on the specified goods since the date the TCO is deemed to have come into effect, as per the Customs Tariff Act 1995. Any application for a TCO must be accompanied by a public notice in the Gazette, inviting submissions from any interested parties, although in the case of TCO No. 0834339, no such submissions were received.
Key Provisions
The Tariff Concession Instrument No. 0834339 is an instrument made under the Customs Act 1901 (the Act) that grants tariff concessions on certain track laying excavator parts. According to section 269F of the Act, an application can be made to the Chief Executive Officer of Customs (the CEO) for a Tariff Concession Order (TCO) in respect of goods. If the CEO is satisfied that the application meets the core criteria set out in section 269C, they must make a written order (a TCO) declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff). This instrument was made on 12 January 2009, and it specifies that the goods in question are subject to item 50 of Schedule 4 to the Tariff, with a duty rate of free instead of the general rate of 5%.
The obligations under this Act primarily rest with the CEO, who must assess TCO applications against the core criteria outlined in section 269C of the Act. This includes verifying that no substitutable goods were produced in Australia on the day the application was lodged. If the CEO determines that the application meets the criteria, they are required to publish a notice in the Gazette inviting submissions from any person who may have reasons why the TCO should not be made. The CEO must then consider any submissions received and make a final decision. In this case, no submissions were received, and the CEO proceeded to make the TCO.
In terms of enforcement and compliance, the Act provides for certain consequences in the event of non-compliance. While the explanatory statement does not detail specific offences or penalties, the making of a TCO and its enforcement are governed by the broader provisions of the Customs Act 1901, which includes potential penalties for non-compliance with customs regulations. The Act ensures that the rights of persons other than the Commonwealth are not adversely affected by the TCO, and it does not impose any liabilities on any person. Importers of the affected goods can apply for a refund of duty on goods imported since the TCO came into effect, under paragraph 126(1)(r) of the Regulations.