EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0948447
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.
Mineworks Group Pty Ltd applied for a TCO in respect of certain diesel engine filter parts on 01 January 2010.
Instrument
TCO No 0948447 was made on 05 March 2010. It declares that those certain diesel engine filter parts 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. 0948447 is taken to have come into force on 01 January 2010.
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 Order No. 0948447, enacted under the Customs Act 1901, was introduced to provide a concessional rate of customs duty for certain diesel engine filter parts, specifically those applied for by Mineworks Group Pty Ltd on 01 January 2010. This legislative instrument aims to address the issue of ensuring that Australian businesses have access to competitively priced components necessary for their operations, thereby potentially fostering economic efficiency and competitiveness. The instrument was developed and enacted by the Chief Executive Officer of Customs, following the statutory requirement that if an application meets the core criteria, such as the absence of substitutable goods produced in Australia, a Tariff Concession Order must be issued. The order specifies that these particular diesel engine filter parts will be subject to a duty rate of free, as opposed to the general rate of 5%, and it came into effect on the date the application was lodged.
Scope and Application
The Tariff Concession Instrument No. 0948447 under the Customs Act 1901 applies specifically to the goods that are the subject of the concession order, namely certain diesel engine filter parts. This Act is relevant to entities that produce or import these goods, and it is administered by the Chief Executive Officer of Customs (CEO) who has the authority to make Tariff Concession Orders (TCOs) to lower the rate of customs duty. The application of this Act is national in scope as it pertains to the Commonwealth of Australia and affects the importation of goods into the country. It is noteworthy that this legislation does not apply to goods specified in section 269SJ of the Customs Act 1901, which outlines those goods that cannot be subject to a TCO. Furthermore, the CEO must ensure that no substitutable goods were produced in Australia on the day the TCO application was lodged, as stipulated in section 269C of the Act. The TCO does not affect existing rights or impose liabilities on any person in respect of actions taken before the TCO's effective date, thereby protecting the interests of those already engaged in the import or production of these goods.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 0948447, made under section 269F of the Customs Act 1901, are sections 269C and 269P. Section 269C specifies the core criteria that must be met for an application for a Tariff Concession Order (TCO) to be considered. For the application to meet these criteria, it must be established that no substitutable goods were produced in Australia in the ordinary course of business on the date the application was lodged (section 269C). Section 269P, particularly subsection (3), mandates that if the Chief Executive Officer (CEO) of Customs is satisfied that the application meets these criteria, a written TCO must be issued. This order declares that the goods in question are subject to a prescribed tariff item, which, in this case, is item 50 of Schedule 4 to the Customs Tariff Act 1995, resulting in a duty rate of free instead of the general rate of 5%.
The obligations imposed by the Act on the parties involved, particularly the CEO of Customs, include a requirement to thoroughly evaluate any application for a TCO against the core criteria set out in section 269C. Upon receiving an application, the CEO must also ensure that a notice is published in the Gazette as soon as practicable, inviting any interested parties to submit objections or reasons why the TCO should not be granted (subsection 269K(1)). This transparency measure is intended to allow all stakeholders to voice any concerns they might have about the proposed concession. In this specific instance, no submissions were received in response to the published notice, indicating that no objections were raised.
In terms of potential breaches and their consequences, the Customs Act 1901 does not explicitly detail offences, penalties, or civil or criminal consequences for non-compliance with the TCO provisions. However, the general legal framework under which the Act operates implies that any misuse or fraudulent activity related to the TCO could lead to criminal charges. Such actions might include providing false information in an application, which could be prosecuted under the general criminal law provisions for fraud or deception. The penalties for these offences would depend on the specific circumstances and could range from fines to imprisonment, as per the general criminal penalties outlined in Australian law. The Act ensures that the TCO does not affect the rights of any person adversely or impose new liabilities on them, thus protecting the interests of all parties involved.