EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1000291
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.
Bosch Chassis Systems Australia applied for a TCO in respect of certain aluminium anodising machines on 04 January 2010.
Instrument
TCO No 1000291 was made on 26 March 2010. It declares that those certain aluminium anodising 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. 1000291 is taken to have come into force on 04 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 Instrument No. 1000291 was enacted in 2010 under the Customs Act 1901 to provide a lower rate of customs duty on certain aluminium anodising machines, addressing the issue of high customs duty on imported goods that were not produced domestically and had no suitable substitutes. This instrument was created in response to an application from Bosch Chassis Systems Australia, which sought a tariff concession for the specified machines. The Customs Act 1901, as amended, allows the Chief Executive Officer of Customs to grant such concessions if certain criteria are met, including the absence of substitutable goods produced in Australia. The policy objective is to facilitate the import of essential goods that are not domestically produced, thereby promoting competitive pricing and potentially aiding local industries by lowering the cost of imported components.
Scope and Application
The Customs Act 1901 applies to any individual or entity seeking to import goods into Australia, as it governs the imposition and concession of customs duties. Specifically, the Tariff Concession Instrument No. 1000291 pertains to applications for Tariff Concession Orders (TCOs) under Part XVA of the Act, which are made by the Chief Executive Officer of Customs (CEO) for goods that are not substitutable by Australian-produced goods. This legislation is applicable on a national level and involves the reduction or exemption of customs duty on specified imported goods, as determined by the CEO. Exclusions from this Act include goods listed in section 269SJ, which are ineligible for TCOs. The CEO's decision to grant a TCO is contingent on meeting the core criteria outlined in sections 269C and 269D of the Act, and any subordinate instruments or regulations further clarify or extend the application of the Act. The TCO in question, concerning certain aluminium anodising machines, was made effective from the date the application was lodged, 4 January 2010, and grants a duty-free status to these goods under item 50 of Schedule 4 to the Tariff.
Key Provisions
The main operative sections of the Customs Act 1901, as it pertains to Tariff Concession Orders (TCOs), include sections 269C, 269F, and 269P(3) (sections 269C, 269F, 269P(3)). Section 269F allows for an application to be made to the Chief Executive Officer of Customs (CEO) for a TCO. If the application meets the core criteria outlined in section 269C, the CEO is required to make a written order (section 269P(3)) declaring that the goods subject to the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies.
The Act imposes several obligations on the parties involved in the TCO process. Firstly, applicants for a TCO must ensure that their application is not in respect of goods specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. Secondly, the CEO must assess whether the application meets the core criteria, which includes verifying that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. This assessment is based on definitions provided in sections 269D and 269E of the Act, which detail what constitutes 'goods produced in Australia' and 'ordinary course of business', respectively. Once the CEO is satisfied that the application meets the criteria, they must make a TCO within the prescribed timeframe.
There are specific consequences and penalties outlined in the Act for breaches of the TCO provisions. However, the Explanatory Statement does not explicitly state any offences, penalties, or civil/criminal consequences for non-compliance with the TCO requirements. Typically, breaches of customs regulations can result in penalties such as fines and, in severe cases, criminal charges. The exact penalties depend on the nature and severity of the breach, as well as any relevant provisions in the Customs Act 1901 and other related legislation. The focus of the document is more on clarifying the process for granting TCOs and the implications for affected parties rather than detailing penalties for non-compliance.