EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1042813
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.
Maxwell Engineering applied for a TCO in respect of certain handbrake assembly rolling stock parts on 17 September 2010.
Instrument
TCO No 1042813 was made on 13 December 2010. It declares that those certain handbrake assembly rolling stock 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. 1042813 is taken to have come into force on 17 September 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 Customs Act 1901, enacted by the Parliament of Australia, provides a framework under which Tariff Concession Orders (TCOs) can be made to reduce customs duty on specific goods. The Act was designed to address the issue of ensuring that certain goods, which are not produced in Australia or for which substitutable goods are not readily available, are accessible at a lower cost, thereby promoting trade and economic efficiency. Specifically, Part XVA of the Customs Act 1901 empowers the Chief Executive Officer of Customs to grant tariff concessions to applicants who meet the specified criteria. The policy objective of this mechanism is to facilitate the import of goods that are essential but not domestically produced, thereby supporting industries reliant on these imports. The Tariff Concession Instrument No. 1042813, made on 13 December 2010, is an example of this process in action, where certain handbrake assembly rolling stock parts were granted a tariff concession, reducing their customs duty rate to free from the general rate of 5%.
Scope and Application
The Tariff Concession Instrument No. 1042813, made under section 269F of the Customs Act 1901, applies to goods that are subject to a Tariff Concession Order (TCO) made by the Chief Executive Officer of Customs. The instrument specifically pertains to certain handbrake assembly rolling stock parts, which are declared as goods to which item 50 of Schedule 4 to the Customs Tariff Act 1995 applies, with a duty rate of zero. This concession is contingent upon the CEO's determination that no substitutable goods are produced in Australia, as outlined in section 269C. The Act applies to entities that import these specified goods, and the concession is effective from the date the application for the TCO was lodged, which is 17 September 2010. The instrument does not affect any existing rights or impose liabilities on persons other than the Commonwealth for actions taken before the registration date. Importers stand to benefit from this concession as they can apply for a refund of duty on goods imported since the commencement date.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 1042813, issued under the Customs Act 1901, include section 269C which sets out the core criteria for a Tariff Concession Order (TCO), and section 269P(3) which mandates that the Chief Executive Officer of Customs (CEO) must issue a written TCO if the application meets the core criteria. Section 269K(1) requires the CEO to publish a notice in the Gazette inviting submissions against the TCO application. Section 269S(1) specifies that a TCO comes into force on the date the application was lodged. These sections together ensure that the process for applying for and granting a TCO is transparent and allows for public input.
Under the Act, the obligations imposed on parties include the requirement for applicants such as Maxwell Engineering to ensure their application for a TCO is valid and meets the core criteria specified in section 269C. The CEO has the duty to assess the application, publish a notice in the Gazette under section 269K(1), and consider any submissions received. If the CEO determines that the application meets the criteria, they must issue the TCO as outlined in section 269P(3). Additionally, the CEO must ensure that the TCO does not disadvantage any person or impose liabilities on them for actions taken before the TCO's effective date, as stipulated under the Regulations.
There are no specific offences, penalties, or consequences mentioned in the provided text for breaches of the provisions of the Tariff Concession Instrument No. 1042813. However, the Customs Act 1901 and related regulations may impose penalties for non-compliance with other provisions of the Act. For instance, section 166 of the Act generally provides for penalties for breaches of the Act, which could include fines and imprisonment, though the exact penalties depend on the nature and severity of the breach. The Act's comprehensive framework ensures that any violations are addressed appropriately within the legislative context.