EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0902629
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.
Baulderstone Hornibrook applied for a TCO in respect of certain screeding machines on 27 January 2009.
Instrument
TCO No 0902629 was made on 24 April 2009. It declares that those certain screeding 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 10%. 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. 0902629 is taken to have come into force on 27 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 Customs Act 1901 was enacted to regulate the importation and exportation of goods and the assessment of customs duty. It establishes the framework for Tariff Concession Orders (TCOs) that allow for reduced customs duty rates on certain goods. The Act was introduced to streamline the process of applying for tariff concessions and to ensure that the application criteria are met, particularly in cases where no substitutable goods are produced in Australia. The Tariff Concession Instrument No. 0902629 was made by the Chief Executive Officer of Customs on 24 April 2009 in response to an application from Baulderstone Hornibrook for a TCO on specific screeding machines. The CEO determined that the application met the core criteria as no substitutable goods were produced in Australia, and the TCO was published in the Gazette, with no submissions received against it. The tariff concession is effective from 27 January 2009, the date the application was lodged, and provides a zero duty rate on the specified machines, which otherwise attract a 10% duty rate.
Scope and Application
The Tariff Concession Instrument No. 0902629, made under the Customs Act 1901, pertains specifically to the application and issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). The legislation applies to any individual or entity that applies for a TCO in respect of goods, provided the application does not involve goods specified as ineligible under section 269SJ of the Act. The instrument impacts the importation of goods, particularly by granting tariff concessions on certain screeding machines as per the application made by Baulderstone Hornibrook on 27 January 2009. The geographic reach of this legislation is national, as it pertains to the federal customs laws of Australia. The TCO does not apply to goods that are already being produced in Australia in the ordinary course of business, as outlined by sections 269C, 269D, and 269E of the Act. Any exclusions or exemptions from the application of the TCO are determined based on the criteria specified in the Customs Act 1901 and the Customs Tariff Act 1995. The CEO is required to publish a notice in the Gazette inviting submissions from interested parties, although in this case, no submissions were received. The TCO has been effective from the date the application was lodged, 27 January 2009, without affecting the rights of any person other than the Commonwealth.
Key Provisions
The Customs Act 1901 (the Act) provides a mechanism for tariff concession orders (TCOs) through Part XVA, specifically section 269F, which allows an application to be made to the Chief Executive Officer of Customs (CEO) for a TCO in respect of certain goods. A TCO can result in a lower rate of customs duty on those goods (s 269P(3)). The CEO must make a written order if satisfied that the application meets the core criteria, which are outlined in section 269C of the Act. Section 269C requires that on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business.
The Act places specific obligations on the CEO when considering a TCO application. According to subsection 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made. The CEO must consider these submissions and make a decision based on whether the core criteria are met, as defined in section 269C of the Act. In this instance, Baulderstone Hornibrook applied for a TCO for certain screeding machines, and no submissions were received by the CEO. Therefore, the CEO proceeded to issue TCO No. 0902629, which declares that these machines are subject to a free rate of duty under item 50 of Schedule 4 to the Customs Tariff Act 1995.
Under the Customs Act 1901, there are specific consequences for non-compliance with the provisions related to TCOs. While the explanatory statement does not explicitly outline penalties for breaching the provisions, it is understood that breaches of the Act generally result in civil or criminal penalties, depending on the nature and severity of the breach. The maximum penalties could include fines and imprisonment for criminal offences, as stipulated by other sections of the Act or related legislation. For instance, misleading or deceptive conduct under the Australian Consumer Law could result in substantial penalties for corporations. However, the specific penalties applicable to breaches related to TCOs would need to be reviewed in the context of the broader legal framework.