EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0926784
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.
Toyota Material Handling Australia Pty Limited applied for a TCO in respect of certain lateral and front stacking turret trucks on 27 July 2009.
Instrument
TCO No 0926784 was made on 24 December 2009. It declares that those certain lateral and front stacking turret trucks 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. 0926784 is taken to have come into force on 27 July 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 by the Australian Parliament to regulate the importation and exportation of goods. The Act, through its Part XVA, allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This mechanism was introduced to address the problem of ensuring that Australian businesses have access to goods that are not produced domestically, while maintaining a fair competitive environment. In particular, the Act aims to facilitate the import of goods that are not substituted by local production, thereby supporting industry competitiveness and consumer choice. The explanatory statement for Instrument No. 0926784 details a TCO granted to Toyota Material Handling Australia Pty Limited for certain lateral and front stacking turret trucks, which now enjoy a tariff rate of free, as opposed to the general rate of 5%. This was made possible under the Act when the CEO was satisfied that no substitutable goods were produced in Australia, meeting the core criteria specified in the legislation.
Scope and Application
The Tariff Concession Instrument No. 0926784 under the Customs Act 1901 applies to the specific goods that are the subject of the application, which in this case are certain lateral and front stacking turret trucks. The Act applies to entities and persons who are involved in the import of these goods, providing them with a reduced rate of customs duty as per the terms of the Tariff Concession Order (TCO). This concession is contingent upon the condition that no substitutable goods are produced in Australia, and the CEO must be satisfied that the application meets the core criteria set out in the Act. The geographic reach of this Act is national, impacting all importers across Australia. Notably, the Act excludes certain goods specified in section 269SJ from being subject to a TCO, ensuring that only eligible goods benefit from tariff concessions. The commencement of this TCO is retroactive to the date the application was lodged, meaning that the benefits apply from that initial date without disadvantaging any party. The Act also ensures that the TCO does not affect any existing rights or impose liabilities on any person other than the Commonwealth.
Key Provisions
The key provisions of Tariff Concession Instrument No. 0926784 under the Customs Act 1901 primarily revolve around the establishment of a Tariff Concession Order (TCO) for certain lateral and front stacking turret trucks (section 269P(3)). This instrument, issued on 24 December 2009, declares that these specified trucks are subject to a lower rate of customs duty, specifically free, instead of the general rate of 5% (section 269P(3)). The instrument was triggered by an application from Toyota Material Handling Australia Pty Limited on 27 July 2009, and it came into force on the same day, as per subsection 269S(1).
The obligations imposed by this Act on the parties involved primarily pertain to the process of applying for and receiving a TCO. For instance, an applicant such as Toyota Material Handling Australia Pty Limited must ensure that the goods in question do not have substitutable goods produced in Australia, as per section 269C. The Chief Executive Officer of Customs (CEO) must then verify that the application meets the core criteria, which involves confirming that no such substitutable goods were produced in Australia on the day the application was lodged, as defined by sections 269D, 269E and 269B. Upon meeting these criteria, the CEO is mandated to issue a written TCO, as outlined in section 269P(3). Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to submit objections if they believe the TCO should not be made, as stipulated in subsection 269K(1).
Any breaches of the provisions under the Customs Act 1901 can lead to various civil and criminal consequences. The Act does not explicitly detail specific offences or penalties within the explanatory statement itself, but general provisions in the Act would apply. Typically, breaches of customs laws can result in fines and, in more severe cases, imprisonment. The exact penalties would depend on the nature and severity of the breach, with the potential for significant financial penalties and imprisonment terms for serious or repeated violations. It is important for all parties to comply with the Act to avoid these potential repercussions.