EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0901610
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.
Conveyor Technologies Pty Ltd applied for a TCO in respect of certain conveyor roller on 19 January 2009.
Instrument
TCO No 0901610 was made on 14 April 2009. It declares that those certain conveyor roller 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. 0901610 is taken to have come into force on 19 January 2009.
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 Tariff Concession Instrument No. 0901610, enacted in 2009, is a measure under the Customs Act 1901, designed to address the issue of applying tariff concessions on specific goods that are not produced in Australia and for which there are no substitutable domestic goods. The Customs Act 1901 provides the framework under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs, allowing for a lower rate of customs duty on goods specified in such orders. The policy objective, as per section 269F of the Act, is to facilitate applications from individuals or entities seeking tariff concessions on imported goods that are not manufactured domestically and have no substitutable Australian-made counterparts, thereby encouraging trade and reducing the cost of importing certain goods.
The enactment of this specific TCO was in response to an application from Conveyor Technologies Pty Ltd for tariff concessions on certain conveyor rollers, which was approved by the CEO as it met the core criteria stipulated under section 269C of the Customs Act. This involved ensuring that no substitutable goods were produced in Australia at the time the application was lodged, aligning with the definitions provided under sections 269D and 269E of the Act. Following the approval, the TCO was published in the Gazette with no objections received, and it came into effect on the date the application was lodged, 19 January 2009. This legislative action does not disadvantage any person other than the Commonwealth and allows importers to apply for a refund of duty on the specified goods imported since the effective date of the TCO.
Scope and Application
The Tariff Concession Instrument No. 0901610 under the Customs Act 1901 applies to individuals or entities seeking tariff concessions for specific goods, in this case, conveyor rollers, by applying to the Chief Executive Officer of Customs. This Act allows for reduced customs duty rates on goods specified in a Tariff Concession Order (TCO) if certain criteria are met, notably if no substitutable goods are produced in Australia. The application of this Act is national, as it is governed by Commonwealth legislation, and it directly impacts the import duties on goods such as conveyor rollers. The instrument, which came into force on 19 January 2009, exempts certain conveyor rollers from the general rate of duty of 5%, instead applying a duty-free rate as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995. The scope of the Act extends to include the publication of notices in the Gazette to allow for public submissions, although in this instance, no objections were received. The Act does not disadvantage any person other than the Commonwealth and does not impose any new liabilities on entities other than the Commonwealth.
Key Provisions
The main operative sections of this legislation are sections 269C, 269P, and 269SJ of the Customs Act 1901, which govern the making of Tariff Concession Orders (TCOs). Section 269C establishes the core criteria that must be met for a TCO to be considered, which involves ensuring that no substitutable goods are produced in Australia at the time the application is lodged. Section 269P mandates that if the CEO is satisfied that the application meets these criteria, a TCO must be made, effectively declaring the goods subject to the application as being eligible for a reduced or free rate of duty. Section 269SJ specifies the types of goods that are ineligible for a TCO. The Tariff Concession Instrument No. 0901610, issued on 14 April 2009, applies these provisions to certain conveyor rollers, declaring them eligible for a TCO under item 50 of Schedule 4 to the Customs Tariff Act 1995, which sets the duty rate at free.
The Act imposes specific obligations on both the Chief Executive Officer of Customs (CEO) and applicants for TCOs. For the CEO, these include the requirement to assess whether an application meets the core criteria as per section 269C, to publish a notice in the Gazette inviting submissions from interested parties if the application is accepted as valid (subsection 269K(1)), and to make a TCO if the criteria are met (section 269P(3)). For applicants, such as Conveyor Technologies Pty Ltd, the obligation is to submit a valid application to the CEO, ensuring it complies with the requirements under section 269SJ, and providing any necessary information to demonstrate that no substitutable goods are produced in Australia. Both parties must also adhere to the notice and publication requirements, ensuring transparency and allowing for public input where applicable.
Failure to comply with the provisions of the Customs Act 1901 regarding TCOs can result in various legal consequences. While the explanatory statement does not explicitly outline specific penalties for non-compliance, breaches of customs regulations generally can lead to both civil and criminal penalties under Australian law. Civil penalties may include fines, compensation, or other financial penalties as deemed appropriate by the court. Criminal penalties can include fines and imprisonment, depending on the severity of the breach and the discretion of the court. The maximum penalties will vary based on the specific breach and the provisions of the Customs Act 1901 and related legislation, but they can be significant, reflecting the importance of compliance with customs duties and regulations.