EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0918848
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.
Schwing Australia Pty Ltd applied for a TCO in respect of certain concrete pumps vehicle mounted on 03 June 2009.
Instrument
TCO No 0918848 was made on 28 August 2009. It declares that those certain concrete pumps vehicle mounted 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. 0918848 is taken to have come into force on 03 June 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, enacted by the Australian Parliament, addresses the need for a structured process for applying tariff concessions on specific goods, enabling lower rates of customs duty. This Act facilitates the application and approval of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, provided the goods in question are not substitutable by locally produced goods and meet the core criteria set out in the Act. The Tariff Concession Instrument No. 0918848, issued under this Act, was introduced to grant a tariff concession on certain concrete pumps vehicle-mounted, responding to an application by Schwing Australia Pty Ltd. The instrument, which became effective on the date of application, provides a zero rate of duty on these specified goods, aligning with the policy objective of encouraging the importation of goods that are not produced domestically, thereby benefiting importers and potentially stimulating market competition.
Scope and Application
The Customs Act 1901, through its Tariff Concession Orders (TCO) scheme, applies to individuals or entities seeking lower rates of customs duty on specific goods imported into Australia. This scheme is administered by the Chief Executive Officer of Customs (CEO) who evaluates applications to determine if the goods in question are eligible for tariff concessions. The application process requires the applicant to demonstrate that no substitutable goods are produced in Australia in the ordinary course of business, as outlined in sections 269C and 269D of the Act. Once the CEO is satisfied that an application meets the core criteria, a TCO is issued, thereby applying a lower or free rate of duty to the specified goods, as seen in the case of certain concrete pumps vehicle-mounted under TCO No. 0918848. This instrument declares these goods as subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, effectively granting them a duty-free status. The application of this Act extends across the Commonwealth of Australia, with no specific exclusions noted in this instance, although certain goods are statutorily ineligible for TCOs under section 269SJ of the Act.
Key Provisions
The main operative sections of this legislation pertain to the Customs Act 1901, specifically focusing on the creation and enforcement of Tariff Concession Orders (TCOs) as outlined in Part XVA (sections 269C, 269B, 269E, 269F, 269P, and 269K). Section 269F of the Act allows for the application to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. Section 269C stipulates that an application meets the core criteria if, on the date of application, no substitutable goods were produced in Australia in the ordinary course of business. If the CEO is satisfied that an application meets these criteria, section 269P(3) mandates the CEO to make a written order declaring that the goods subject to the TCO application are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. Section 269K(1) requires the CEO to publish a notice in the Gazette inviting submissions if there are reasons why the TCO should not be made, although in this instance, no submissions were received.
The obligations and requirements imposed by this legislation are primarily on the CEO of Customs. The CEO must determine whether an application for a TCO meets the core criteria, which involves ensuring that no substitutable goods were produced in Australia at the time of application. Additionally, the CEO is required to publish a notice in the Gazette and invite submissions if there are reasons why the TCO should not be made. In this specific case, the CEO determined that the application for concrete pumps vehicle-mounted met the core criteria, resulting in the issuance of TCO No. 0918848. The legislation also ensures that the rights of importers will be beneficially affected, allowing them to apply for a refund of duty on goods imported since the day the TCO is taken to have come into force.
Regarding consequences for breach, the Customs Act 1901 does not explicitly state offences, penalties, or civil/criminal consequences for non-compliance with the provisions related to TCOs. However, the broader legal framework within which this Act operates includes provisions for penalties and enforcement actions for non-compliance with customs regulations. These may include fines, imprisonment, or other penalties as prescribed by the relevant legislation. The specific penalties would depend on the nature and severity of the breach, as well as the applicable laws and regulations governing customs and tariffs.