EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0931055
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.
Robert Bosch applied for a TCO in respect of certain anti lock braking systems pumping unit components on 24 August 2009.
Instrument
TCO No 0931055 was made on 13 November 2009. It declares that those certain anti lock braking systems pumping unit components 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. 0931055 is taken to have come into force on 24 August 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, provides a framework for the administration of customs duties and other import charges. It establishes the conditions under which Tariff Concession Orders (TCOs) can be made, offering reduced customs duty rates for certain goods. This legislative scheme was introduced to address the need for tariff flexibility in response to specific economic and trade policy objectives, allowing for more competitive pricing and access to imported goods where domestic production is not feasible or practical. The Tariff Concession Instrument No. 0931055, made under this Act, aims to provide tariff relief for particular goods by the Chief Executive Officer of Customs, in line with the policy objective of promoting efficient trade practices and supporting economic growth by facilitating access to competitively priced imported goods.
Scope and Application
The Tariff Concession Instrument No. 0931055, issued under the Customs Act 1901, applies to any person who may apply for a Tariff Concession Order (TCO) in respect of specific goods, in this case, certain anti-lock braking systems pumping unit components. This application process is overseen by the Chief Executive Officer of Customs (CEO), who must assess whether the application meets the core criteria specified in the Act. The scope of this Act extends to ensuring that no substitutable goods are produced in Australia in the ordinary course of business at the time of application. If the CEO determines that the application meets these criteria, a TCO is issued, resulting in the goods being subject to a lower rate of customs duty. This particular instrument, TCO No. 0931055, was made on 13 November 2009, and it came into force on the day the application was lodged, 24 August 2009. This order exempts the specified components from the general rate of duty, effectively setting the rate of duty at free, thereby benefiting importers who may apply for a refund of duty on goods imported since the TCO's effective date. The application of this TCO does not impose any liabilities on any person and does not affect the rights of any person as at the date of registration.
Key Provisions
The Tariff Concession Instrument No. 0931055 under the Customs Act 1901 (the Act) establishes a concession that applies to certain anti lock braking systems pumping unit components, reducing the customs duty on these goods to zero. This is pursuant to section 269F of the Act, which allows for applications for Tariff Concession Orders (TCOs) to be made to the Chief Executive Officer of Customs (the CEO). In this case, Robert Bosch applied for the TCO on 24 August 2009, and the CEO, satisfied that the application met the core criteria under section 269C, issued the TCO on 13 November 2009. Section 269P(3) mandates that if the application meets the core criteria, a TCO must be made declaring the goods to which a specific item of Schedule 4 to the Customs Tariff Act 1995 applies, in this case item 50.
The Act imposes several obligations on the CEO, including the requirement to publish a notice in the Gazette (subsection 269K(1)) inviting submissions from any interested parties after accepting a TCO application as valid. In this instance, the CEO did not receive any submissions in response to this invitation. Additionally, under subsection 269S(1), the TCO is deemed to come into force on the day the application was lodged, which for TCO No. 0931055 was 24 August 2009. Importantly, the TCO does not affect the rights of any person (other than the Commonwealth) in a way that would disadvantage them or impose any liabilities in respect of actions taken before the date of registration. Importers of the affected goods stand to benefit from the TCO, as they can apply for a refund of duty on goods imported since the TCO came into force under paragraph 126(1)(r) of the Regulations.
Failure to comply with the provisions of the Customs Act 1901, including those related to the making and implementation of TCOs, may result in civil or criminal penalties. The exact nature and severity of these penalties are not detailed in the explanatory statement but would typically include fines and potential imprisonment for more serious breaches. The maximum penalties would depend on the specific breach and are not explicitly stated in this explanatory statement, but they are generally outlined in other sections of the Act. The CEO must ensure that all applications for TCOs are handled according to the legislative requirements, and any failure to do so could lead to enforcement actions under the Act.