EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0950049
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.
Gilbarco Australia applied for a TCO in respect of certain fuel pumps on 23 December 2009.
Instrument
TCO No 0950049 was made on 12 March 2010. It declares that those certain fuel pumps 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. 0950049 is taken to have come into force on 23 December 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 regulation of customs and excise through various mechanisms, including Tariff Concession Orders (TCOs). The purpose of the Tariff Concession Instrument No. 0950049, issued in 2010, was to address the need for tariff concessions on specific imported goods, in this case certain fuel pumps, by reducing the duty rate from the general 5% to free. This legislative instrument was introduced to ensure that the application process for tariff concessions is transparent and allows for public consultation, as outlined in section 269K of the Act. The instrument was made effective from the date the application was lodged, 23 December 2009, and does not retroactively affect any rights or liabilities of parties other than the Commonwealth, ensuring that the rights of importers are positively impacted by the reduction in duty rates.
Scope and Application
The Tariff Concession Instrument No. 0950049 under the Customs Act 1901 applies specifically to certain fuel pumps as requested by Gilbarco Australia. The act allows for tariff concession orders (TCO) to be made by the Chief Executive Officer of Customs (CEO) when specific criteria are met, including the absence of substitutable goods produced in Australia. This instrument, which came into force on 23 December 2009, declares that the certain fuel pumps are subject to a zero rate of customs duty as per item 50 of Schedule 4 to the Customs Tariff Act 1995, effectively reducing the general duty rate from 5% to free. The CEO must ensure the application meets core criteria such as the absence of substitutable goods produced in Australia, and the CEO is mandated to publish a notice in the Gazette inviting submissions from any interested parties. In this instance, no submissions were received, allowing the TCO to proceed. The TCO does not retroactively affect the rights of any person other than the Commonwealth and does not impose any liabilities on anyone. Importers of these goods can benefit from applying for a refund of duty on goods imported since the TCO's effective date.
Key Provisions
The key operative sections of Tariff Concession Instrument No. 0950049 (Section 269F, 269C, 269B, and 269P) detail the process by which a Tariff Concession Order (TCO) may be applied for and granted. Specifically, Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of goods. If the application does not concern goods listed in Section 269SJ, which are ineligible for a TCO, the CEO must then determine if the application meets the core criteria set out in Section 269C. This criterion requires that, on the date the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business, as defined by Sections 269B and 269E. If the CEO is satisfied that the application meets these core criteria, Section 269P(3) mandates that the CEO issue a written order, declaring that the goods in question are subject to a prescribed item in Schedule 4 of the Customs Tariff Act 1995. In the case of TCO No. 0950049, certain fuel pumps are declared to be subject to item 50 of Schedule 4, with a duty rate of free instead of the general 5%.
The obligations and requirements imposed by the Act on parties and entities include the necessity for applicants to ensure their goods meet the eligibility criteria for a TCO. This involves demonstrating that no substitutable goods are produced in Australia, which involves a detailed examination by the CEO of the goods' production and use. The CEO must also publish a notice in the Gazette, as per Section 269K(1), inviting any interested parties to submit reasons why the TCO should not be granted. In this instance, no submissions were received, simplifying the process. Furthermore, the Act requires that the TCO does not disadvantage any person other than the Commonwealth and does not impose liabilities for actions taken before the TCO’s effective date.
The Act also specifies the consequences for breaches, although no specific offences or penalties are mentioned in this particular context. However, the general legal framework surrounding the Customs Act 1901 implies that any misuse of the TCO provisions or fraudulent applications could lead to civil or criminal penalties. These may include fines or imprisonment, as typically enforced under Australian law for breaches of customs regulations. The exact penalties would depend on the nature and severity of the breach, but the Act's overarching intent is to ensure compliance and proper application of tariff concessions.