EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0937556
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.
Dematic Pty Ltd applied for a TCO in respect of certain sorting conveyors on 06 October 2009.
Instrument
TCO No 0937556 was made on 30 December 2009. It declares that those certain sorting conveyors 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. 0937556 is taken to have come into force on 06 October 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. 0937556, enacted under the Customs Act 1901, was introduced to address the specific needs of businesses that import goods not produced in Australia, thereby encouraging trade and economic activity. The Customs Act 1901, enacted by the Commonwealth Parliament, established a framework for the application and granting of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This legislative instrument aims to provide tariff relief for certain goods by applying a lower rate of customs duty. The explanatory statement outlines that Dematic Pty Ltd applied for a TCO for certain sorting conveyors on 6 October 2009, and the instrument was subsequently made on 30 December 2009. This tariff concession reduces the general duty rate of 5% to free duty for these specific goods, benefiting importers by potentially allowing them to claim a refund of duty on imports made since the effective date of the concession.
Scope and Application
The Tariff Concession Instrument No. 0937556 applies to specific sorting conveyors and their importation into Australia. This instrument falls under the purview of the Customs Act 1901, specifically targeting entities or individuals involved in the importation of the specified goods. The act applies to all importers who wish to bring in these sorting conveyors into Australia, and the instrument aims to provide a concession on the customs duty applicable to these goods. The geographic reach of this legislation is national, as it pertains to the entire Commonwealth of Australia. The legislation does not specify any exclusions or exemptions, but it does clarify that it does not affect the rights of any person, other than the Commonwealth, as at the date of registration. It is worth noting that the application of this legislation may be extended or further defined through subordinate instruments, which would provide additional clarity or amendments to the original act.
Key Provisions
The Customs Act 1901, specifically within Part XVA, establishes a framework for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). Section 269F of the Act allows any individual to apply to the CEO for a TCO for certain goods, provided these goods do not fall under the exclusions listed in section 269SJ. If the application is deemed valid, the CEO must evaluate whether it meets the core criteria outlined in section 269C. This evaluation involves confirming that, on the day the application was submitted, no substitutable goods were being produced in Australia in the ordinary course of business, as defined by sections 269D, 269E, and 269F. If the CEO is satisfied that these criteria are met, they must issue a written order, the TCO, which specifies that the goods in question will be subject to a particular tariff item as outlined in Schedule 4 of the Customs Tariff Act 1995.
The obligations imposed by the Act on the parties involved are quite straightforward. The CEO must ensure that the application is valid and not related to goods excluded by section 269SJ. If the application meets the criteria, the CEO is obligated to make a TCO. The CEO must also publish a notice in the Gazette inviting any interested parties to submit objections to the TCO, as stipulated by subsection 269K(1). For applicants like Dematic Pty Ltd, the primary obligation is to submit a valid application that satisfies the criteria set by the Act, including ensuring that no substitutable goods are being produced in Australia.
Breaching the conditions of a TCO or providing misleading information in an application can lead to legal consequences. Although the Act does not explicitly list specific offences or penalties for TCO non-compliance, any misrepresentation or fraudulent application could potentially lead to civil or criminal liabilities under other provisions of the Customs Act or related legislation. The penalties for such actions could range from fines to imprisonment, depending on the severity and intent behind the breach. For example, under section 257 of the Customs Act, any person found guilty of knowingly or recklessly providing false information may face substantial fines or imprisonment.
The commencement of a TCO is automatic upon the application's lodgement date, as per subsection 269S(1) of the Act. In the case of TCO No. 0937556, this means that the tariff concessions for the specified sorting conveyors became effective from 06 October 2009. This date is significant because it determines the point from which the lower duty rate applies, and it does not retroactively affect any rights or liabilities incurred before this date. Importers who have imported the affected goods since the commencement date can apply for duty refunds under paragraph 126(1)(r) of the Regulations. Importantly, the TCO does not impose any new liabilities on individuals or entities, maintaining the status quo for any actions taken prior to its effective date.