EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0943633
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.
Baulderstone applied for a TCO in respect of certain formwork and falsework steel on 18 November 2009.
Instrument
TCO No 0943633 was made on 05 February 2010. It declares that those certain formwork and falsework steel 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. 0943633 is taken to have come into force on 18 November 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 Parliament of Australia to regulate the importation and exportation of goods. In 2010, Tariff Concession Instrument No. 0943633 was introduced to provide tariff concessions for certain formwork and falsework steel, addressing a gap in the tariff regime where these specific goods did not previously benefit from reduced customs duties. This instrument was made under the authority of the Customs Act, specifically section 269F, allowing for the Chief Executive Officer of Customs to grant tariff concessions when no substitutable goods are produced in Australia. The policy objective of this instrument is to support the importation of these goods by applying a free rate of duty, thereby encouraging their availability and potentially lowering costs for businesses and consumers reliant on these materials. This concession is effective from the date the application was lodged, 18 November 2009, and does not adversely affect the rights of any person or impose new liabilities.
Scope and Application
The Customs Act 1901, specifically under Part XVA, facilitates the application of Tariff Concession Orders (TCOs) that can significantly reduce the customs duty on certain goods. These orders are applicable to goods that are subject to a TCO application made to the Chief Executive Officer of Customs (CEO), provided that the application meets the core criteria set out in section 269C of the Act, including the absence of substitutable goods produced in Australia as per section 269D. The Act applies to the goods specified in the application, and its geographic reach is national, affecting all entities involved in the importation of the specified goods within Australia. The scope of the Act is extended through subordinate instruments such as the Customs Tariff Act 1995, which specifies the duty rates for the goods under the concession. The application of the Act is restricted to goods that are not listed in section 269SJ, which excludes certain goods from being subject to a TCO. The TCO process involves public consultation, as mandated by section 269K(1) of the Act, which requires the CEO to publish a notice in the Gazette inviting submissions from interested parties. In the case of TCO No. 0943633, the CEO made the order effective from the date the application was lodged, 18 November 2009, without any submissions to the contrary.
Key Provisions
The primary operative sections of this legislation, as outlined in the explanatory statement, revolve around the application, assessment, and approval of Tariff Concession Orders (TCOs) under the Customs Act 1901. Specifically, section 269F allows for an application to be made to the Chief Executive Officer of Customs (CEO) for a TCO, provided the goods in question do not fall under the restrictions specified in section 269SJ. The core criteria for approval, detailed in sections 269C, 269B, 269D, 269E, and 269P(3), are designed to ensure that the goods subject to the TCO are not substitutable by goods produced in Australia. If these criteria are met, the CEO must issue a written TCO (section 269P(3)), which in this case, applies to certain formwork and falsework steel, as declared in TCO No. 0943633.
The obligations and requirements imposed by the Customs Act 1901 on the parties involved are significant. The CEO is mandated to assess whether an application for a TCO meets the core criteria, which includes verifying that no substitutable goods are produced in Australia (section 269C). Additionally, the CEO is required to publish a notice in the Gazette inviting submissions from interested parties if the application is deemed valid (subsection 269K(1)). Once the TCO is issued, it comes into effect from the date the application was lodged (subsection 269S(1)), as seen in TCO No. 0943633, which is effective from 18 November 2009. Importers of the affected goods benefit from this order by being eligible to apply for a refund of duty paid on those goods since the effective date (paragraph 126(1)(r) of the Regulations).
Failure to comply with the provisions of the Customs Act 1901 and the terms of the TCO can lead to various consequences. While the explanatory statement does not detail specific offences or penalties for breaching the Act or the TCO, it is reasonable to infer that non-compliance could result in legal actions. Typically, breaches of customs regulations can lead to fines and other civil or criminal penalties under the broader framework of the Customs Act 1901, which may include substantial monetary fines and potential imprisonment depending on the severity of the breach. The exact penalties would be determined by the relevant courts based on the specific circumstances of the case.