EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0939983
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.
Godfrey Hirst Australia PL applied for a TCO in respect of certain carpet tile bevelling and heat sealing machines on 23 October 2009.
Instrument
TCO No 0939983 was made on 04 January 2010. It declares that those certain carpet tile bevelling and heat sealing machines 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. 0939983 is taken to have come into force on 23 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 Customs Act 1901, enacted by the Parliament of Australia, provides a framework for the regulation of customs duties and tariffs. To address the need for tariff concessions for certain imported goods, the Act allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. These orders enable a lower rate of customs duty on specified goods, provided they meet certain criteria. The Tariff Concession Instrument No. 0939983 was introduced to facilitate the application of Godfrey Hirst Australia PL for a tariff concession on certain carpet tile bevelling and heat sealing machines, effectively reducing the duty rate from 5% to free, effective from the date the application was lodged. This legislative instrument ensures that the rights of importers are protected and that no new liabilities are imposed on any party as a result of the tariff concession.
Scope and Application
The Tariff Concession Instrument No. 0939983 under the Customs Act 1901 applies to specific goods, namely certain carpet tile bevelling and heat sealing machines, and is targeted at entities and individuals importing these goods into Australia. The instrument facilitates the application of a lower rate of customs duty on these goods by the Chief Executive Officer of Customs (CEO) when it is determined that no substitutable goods are produced in Australia. The legislation applies at the Commonwealth level, governed by the provisions outlined in Part XVA of the Customs Act 1901. The scope of the Act is further defined by the Customs Tariff Act 1995, specifically referencing item 50 of Schedule 4, which determines the tariff rates. The instrument does not affect any pre-existing rights of persons, except for the Commonwealth, ensuring that the application of the concession does not disadvantage any party or impose liabilities for actions taken prior to the concession's effective date. The TCO was published in the Gazette with an invitation for submissions, though none were received, leading to the issuance of the concession.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0939983, which is made under the Customs Act 1901, primarily focus on establishing the process for granting tariff concessions on certain goods. Specifically, section 269F (1) allows for the application of Tariff Concession Orders (TCOs) by interested parties. Once an application is submitted, section 269C stipulates that the Chief Executive Officer of Customs (CEO) must assess whether the application meets the core criteria. If the application is valid and the core criteria are met, as per section 269P(3), the CEO must issue a written order that grants the tariff concession. This particular TCO, No. 0939983, applies to certain carpet tile bevelling and heat sealing machines, granting them a duty-free status under item 50 of Schedule 4 to the Customs Tariff Act 1995.
The obligations and requirements imposed by the Act on the parties it governs are primarily centred around the application process and the assessment criteria for tariff concessions. The applicant, in this case Godfrey Hirst Australia PL, must submit a valid application to the CEO for a TCO, which must then be assessed against the core criteria outlined in section 269C. The CEO is required to publish a notice in the Gazette inviting submissions from any interested parties who might oppose the concession. If no submissions are received, as was the case with TCO No. 0939983, the CEO can proceed to make the TCO. The Act ensures that the TCO does not retroactively affect the rights of any parties other than the Commonwealth, thus protecting pre-existing rights and obligations.
Under the Customs Act 1901, there are specific consequences for breaches of the provisions related to TCOs, although the explanatory statement does not detail any specific offences or penalties. Generally, the Act provides for both civil and criminal penalties for breaches, which can include fines and imprisonment depending on the nature and severity of the breach. The maximum penalties are not specified in this explanatory statement but are detailed in other sections of the Act. The primary focus here is on ensuring compliance with the legislative requirements for granting tariff concessions to maintain the integrity of the customs duty system.
The Tariff Concession Instrument No. 0939983, which applies to certain carpet tile bevelling and heat sealing machines, exemplifies the process of granting tariff concessions under the Customs Act 1901. By meeting the core criteria and following the prescribed application and assessment procedures, the CEO was able to issue a TCO that provides duty-free status for the specified goods. The Act imposes clear obligations on applicants and the CEO to ensure that tariff concessions are granted fairly and in accordance with the law. While the explanatory statement does not detail specific penalties for breaches, the Act provides for both civil and criminal consequences, underscoring the importance of compliance with its provisions.