EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0906487
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.
Bluescope Steel applied for a TCO in respect of certain laboratory simulators on 24 February 2009.
Instrument
TCO No 0906487 was made on 15 May 2009. It declares that those certain laboratory simulators 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. 0906487 is taken to have come into force on 24 February 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. 0906487 was enacted in 2009 under the Customs Act 1901 to address a specific gap in tariff concession applications for certain goods. The Act, managed by the Australian Parliament, aims to provide a streamlined process for granting tariff concessions to importers of goods not produced in Australia. The explanatory statement clarifies that this instrument was introduced to respond to an application by Bluescope Steel for tariff concessions on certain laboratory simulators, which are not produced in Australia. By granting this concession, the legislation ensures that these goods are subject to a lower rate of customs duty, aligning with the policy objective of facilitating trade and reducing costs for importers without imposing any new liabilities or disadvantaging existing rights holders.
Scope and Application
The Customs Act 1901, specifically under Part XVA, provides a framework for the creation of Tariff Concession Orders (TCO) that can apply a lower rate of customs duty to certain goods. These TCOs are made by the Chief Executive Officer of Customs (CEO) upon application by any person, provided the goods in question are not those specified in section 269SJ of the Act and meet the core criteria outlined in section 269C. The process involves ensuring that no substitutable goods are produced in Australia in the ordinary course of business as per section 269D and 269E of the Act. If the CEO determines that the application meets these criteria, they must make a written TCO specifying the lower duty rate applicable to the goods in question, as per section 269P(3). This particular legislation applies to any entity or individual importing goods that qualify under a TCO, with the intent to provide tariff relief for goods that do not have local substitutes. The application of this Act is nationwide, applying across the Commonwealth of Australia, and it does not disadvantage any person or impose liabilities on anyone in respect of actions taken prior to the TCO's effective date. Any TCOs are made effective from the date the application is lodged, ensuring that importers can benefit from the reduced duty rates prospectively.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0906487, pursuant to the Customs Act 1901, involve the establishment of a Tariff Concession Order (TCO) for specific laboratory simulators. Section 269F outlines the process by which an application for a TCO can be submitted to the Chief Executive Officer (CEO) of Customs. If the CEO determines that the application is valid and meets the criteria set out in section 269C, a TCO can be issued. This process is subject to the condition that no substitutable goods are produced in Australia, as defined in section 269D. Once the CEO is satisfied that the application meets the core criteria, section 269P(3) mandates that a written order be issued, declaring that the specified goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, with a tariff concession applied.
The obligations and requirements imposed by the Act on the parties involved are primarily centered around the application and assessment process for the TCO. Section 269K(1) requires the CEO to publish a notice in the Gazette, inviting any interested parties to submit objections or submissions if they believe the TCO should not be made. This transparency measure ensures that all stakeholders have the opportunity to voice their concerns. Furthermore, section 269S(1) stipulates that the TCO will come into force on the date the application is lodged. The CEO is also required to ensure that the TCO does not adversely affect the rights of any person other than the Commonwealth and does not impose any liabilities on any person prior to the TCO's registration.
The legislation imposes specific consequences for non-compliance with the requirements set forth in the Customs Act 1901 and the Tariff Concession Instrument No. 0906487. While the explanatory statement does not explicitly state the penalties for breaches, it is understood that failure to comply with the conditions of a TCO could lead to civil or criminal consequences, depending on the nature and severity of the breach. Typically, breaches of customs regulations can result in fines or imprisonment, as outlined in the Customs Act 1901. The maximum penalties for such offences can vary, but they are generally significant, reflecting the seriousness of non-compliance with customs laws. The exact penalties would need to be referred to within the broader scope of the Customs Act 1901 and related regulations.