EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0914502
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.
Adi Munitions applied for a TCO in respect of certain metallica cartridge belt links on 01 May 2009.
Instrument
TCO No 0914502 was made on 24 July 2009. It declares that those certain metallica cartridge belt links 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. 0914502 is taken to have come into force on 01 May 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, as amended, provides a framework for the imposition of customs duties on imported goods, and allows for certain concessions to be applied through Tariff Concession Orders (TCOs). Enacted by the Parliament of Australia, this legislation aims to facilitate trade by providing tariff relief for specific goods, under the condition that no substitutable goods are produced in Australia. Instrument No. 0914502, made under the authority of the Customs Act, was introduced to provide a tariff concession for certain metallic cartridge belt links, effective from the date of the application, 01 May 2009. This concession was made following an application by Adi Munitions and was subsequently approved by the Chief Executive Officer of Customs, who determined that no substitutable goods were being produced domestically. The policy objective is to support Australian importers by reducing the cost of importing specific goods, thereby potentially enhancing competitiveness and encouraging trade.
Scope and Application
The Customs Act 1901, as outlined in the Tariff Concession Instrument No. 0914502, pertains to the application and implementation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. The Act applies to any person who may apply for a TCO in respect of goods that are not specified in section 269SJ of the Act, which includes goods that cannot be subject to a TCO. The application process requires the CEO to determine if the core criteria are met, specifically if no substitutable goods were produced in Australia on the day the application was lodged. The TCO No. 0914502, which was made on 24 July 2009, applies to certain metallic cartridge belt links and declares that these goods are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, with the rate of duty set at free, as opposed to the general rate of 5%. The instrument is effective from 01 May 2009, the date the application was lodged, and does not disadvantage any person or impose liabilities in respect of actions taken before its registration. The TCO benefits importers by allowing them to apply for a refund of duty on goods imported since the effective date.
Key Provisions
The primary sections of this legislation (F2009L04462) include section 269F, which allows a person to apply to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO). The CEO must then determine if the application meets the core criteria, as outlined in section 269C, which states that no substitutable goods must be produced in Australia in the ordinary course of business on the day the application is lodged. If the application meets these criteria, the CEO must issue a written order, a TCO, declaring the goods specified in the application (section 269P(3)). In this particular case, the TCO No. 0914502 declares that the metallica cartridge belt links are subject to a zero rate of duty, rather than the general rate of 5%.
The Customs Act 1901 imposes certain obligations on parties involved with TCOs. The CEO must assess whether an application meets the core criteria and, if it does, issue a TCO. The applicant must ensure that their application is valid and meets the necessary criteria. Furthermore, the CEO is required to publish a notice in the Gazette inviting any person who believes the TCO should not be made to lodge a submission (subsection 269K(1)). In this instance, no submissions were received in response to the published notice.
Breach of the requirements outlined in the Customs Act 1901 can result in various consequences. The Act does not explicitly outline offences or penalties for non-compliance; however, it is essential to adhere to the Act's provisions to avoid any potential civil or criminal consequences. The Customs Act 1901 and associated regulations provide for penalties for breaches, which can include fines and imprisonment. For instance, section 245-1 of the Crimes Act 1914 sets out penalties for knowingly making a false statement or representation to an officer of Customs, with a maximum penalty of 2 years imprisonment. Additionally, section 283-1 of the Criminal Code Act 1995 outlines the general offence of attempting to defeat or obstruct an officer of Customs, with a maximum penalty of 2 years imprisonment.
In summary, the legislation in question establishes a process for the CEO of Customs to grant tariff concessions on specific goods through Tariff Concession Orders. It imposes obligations on applicants and the CEO, including the requirement to assess the application's core criteria and publish a notice inviting submissions. Failure to comply with the Customs Act 1901 and associated regulations may result in civil or criminal consequences, including fines and imprisonment.