EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0842469
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.
Toyota Tsusho Australasia applied for a TCO in respect of certain bumper fascia hole making press machine on 03 December 2008.
Instrument
TCO No 0842469 was made on 27 February 2009. It declares that those certain bumper fascia hole making press machine 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. 0842469 is taken to have come into force on 03 December 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, established a framework for the application and administration of customs duties. The Act introduced Tariff Concession Orders (TCOs) under Part XVA, allowing the Chief Executive Officer of Customs to apply reduced customs duties on certain goods. The purpose of this legislation is to provide relief from customs duties on imported goods where no substitutable goods are produced in Australia, thereby supporting industries that rely on imported components or machinery. Instrument No. 0842469, made on 27 February 2009, is an example of such a concession, applying a zero duty rate to specific bumper fascia hole making press machines starting from 3 December 2008. The concession was granted following a successful application by Toyota Tsusho Australasia, after it was determined that no equivalent goods were produced domestically. This measure ensures that the importing businesses are not at a competitive disadvantage due to high customs duties.
Scope and Application
The Customs Act 1901 applies to individuals and entities who are involved in the importation of goods into Australia. This Act, specifically through Part XVA, provides a framework under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs. These orders can result in a lower rate of customs duty on certain goods, provided the application for the concession meets the core criteria outlined in the Act, such as the absence of substitutable goods produced in Australia at the time of the application. The geographic reach of this Act is national, as it applies across all states and territories of Australia. The application of this Act is further defined through the Customs Tariff Act 1995, which specifies the applicable duty rates in the Tariff. Any exclusions or exemptions are detailed in section 269SJ of the Customs Act 1901, which lists goods that cannot be subject to a TCO. The application of the Act can also be extended or restricted through subordinate instruments, such as the Regulations, which provide further detail on matters like the refund of duty to importers.
Key Provisions
The key provisions of Tariff Concession Instrument No. 0842469, as part of the Customs Act 1901, revolve around the application and implementation of Tariff Concession Orders (TCOs) for specific goods. According to section 269F (1), any person can apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of goods. If the application is not for goods specified in section 269SJ, which lists those that cannot be subject to a TCO, the CEO must assess whether the application meets the core criteria set out in section 269C. These criteria are met if, on the date of the application, no substitutable goods were produced in Australia in the ordinary course of business. The definitions of these terms are further explained in sections 269D, 269E, and 269F of the Act. If the CEO is satisfied that the application meets these criteria, a written TCO must be issued, as stipulated in subsection 269P(3).
The obligations imposed by the Act on the CEO include the responsibility to assess applications for TCOs, ensure that the goods specified in the application are eligible, and consult with the public if necessary. In this instance, the CEO was required to publish a notice in the Gazette, as per subsection 269K(1), inviting submissions from any person who believed the TCO should not be made. The CEO did not receive any submissions in response to this invitation. Additionally, the Act mandates that a TCO is to be taken as coming into force on the date the application was lodged, which in this case is 03 December 2008, as per subsection 269S(1). Importantly, the TCO does not affect the rights of any person as at the date of registration to the detriment of that person or impose any liabilities in respect of anything done or omitted before that date, except for the Commonwealth. Importers of the affected goods will be able to apply for a refund of duty on goods imported since the TCO is taken to have come into force.
The Act does not explicitly outline specific offences, penalties, or consequences for breach in the context of TCOs. However, general provisions under the Customs Act 1901 apply to any breaches of the conditions set by the TCOs or any fraudulent activities related to customs duty. Such breaches can result in criminal charges, including imprisonment and fines, under the relevant sections of the Act. The maximum penalties for customs-related offences can be severe, reflecting the seriousness of non-compliance with customs laws and regulations.