EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0835791
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.
Hyne And Son Pty Ltd applied for a TCO in respect of certain slow down machines on 16 October 2008.
Instrument
TCO No 0835791 was made on 14 January 2009. It declares that those certain slow down machines 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. 0835791 is taken to have come into force on 16 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 was amended to introduce Tariff Concession Orders (TCOs) to provide relief to importers of specific goods. Enacted by the Australian Parliament, this legislation aims to address economic and trade inefficiencies by allowing the Chief Executive Officer of Customs to grant duty concessions on certain goods, provided that no substitutable goods are produced in Australia. The Tariff Concession Instrument No. 0835791, introduced to apply a lower rate of customs duty on certain slow down machines, exemplifies the policy objective of promoting fair trade and supporting industries that rely on imported goods. This instrument, which came into force on 16 October 2008, ensures that the application process includes public consultation to maintain transparency and accountability in the decision-making process.
Scope and Application
The Customs Act 1901, specifically Part XVA, governs the process for Tariff Concession Orders (TCOs) which provide for lower rates of customs duty on certain goods. This legislative framework allows for applications to be submitted by individuals or entities to the Chief Executive Officer of Customs for a TCO, provided the goods in question are not specified as ineligible under section 269SJ of the Act. For an application to be considered, it must meet the core criteria outlined in section 269C, which requires that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. The definitions of key terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods' are further elaborated in sections 269D, 269E, and 269F respectively. Upon meeting these criteria, the CEO is mandated to issue a written TCO, as specified in section 269P(3), which then applies a prescribed duty rate from Schedule 4 of the Customs Tariff Act 1995. The application process includes a requirement for the CEO to publish a notice in the Gazette, inviting any interested parties to submit objections to the TCO, although in this case, no such objections were received. The TCO is deemed to have come into effect on the date the application was lodged, and it does not retroactively affect any pre-existing rights or impose new liabilities on individuals or entities, except for the Commonwealth.
Key Provisions
The main operative sections of this legislation (Tariff Concession Instrument No. 0835791) pertain to the creation of Tariff Concession Orders (TCOs) under section 269F of the Customs Act 1901. Section 269C stipulates that a TCO application meets the core criteria if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Section 269P(3) requires the CEO to make a written order if the application meets the criteria, declaring that the goods are subject to a prescribed item in Schedule 4 to the Customs Tariff Act 1995. Instrument TCO No. 0835791, made on 14 January 2009, declares that certain slow down machines are goods to which item 50 of Schedule 4 applies, resulting in a rate of duty of free, instead of the general rate of 5%.
The obligations imposed by the Act on the parties it governs include the requirement for the CEO to assess TCO applications based on the criteria outlined in section 269C. The CEO must ensure that no substitutable goods were produced in Australia in the ordinary course of business before making a TCO. Additionally, section 269K(1) mandates that the CEO 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 consider these submissions before making a final decision. The Act also ensures that the rights of a person (other than the Commonwealth) as at the date of registration are not adversely affected by the TCO.
The legislation imposes specific requirements on the CEO regarding the processing of TCO applications. The CEO must determine whether the application meets the core criteria (section 269C) and, if satisfied, make a written order declaring that the goods are subject to a prescribed item in Schedule 4 to the Customs Tariff Act 1995 (section 269P(3)). The CEO is also required to publish a notice in the Gazette inviting submissions from any interested parties (section 269K(1)). The CEO must consider any submissions received before making a final decision on the TCO. Furthermore, the Act ensures that the TCO does not disadvantage any person or impose liabilities on any person in respect of actions taken before the TCO came into force.
Breaches of the provisions outlined in the Customs Act 1901 may lead to various offences, penalties, or civil and criminal consequences. While the specific penalties are not detailed in the explanatory statement, it is common for breaches of customs legislation to incur financial penalties and potential imprisonment. The exact penalties would depend on the nature and severity of the breach, as well as any relevant provisions in the Customs Act 1901 or other related legislation. It is important to note that the explanatory statement does not provide maximum penalties, and these would need to be referenced in the primary legislation or related legal instruments.