EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1045334
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.
Macwill Roxtec applied for a TCO in respect of certain transit assembly frames and/or stay plates on 07 October 2010.
Instrument
TCO No 1045334 was made on 10 January 2011. It declares that those certain transit assembly frames and/or stay plates 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. 1045334 is taken to have come into force on 07 October 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 was enacted to regulate customs and excise duties and to provide a framework for the administration of these duties in Australia. The Act was introduced to address the need for a structured and systematic approach to managing customs duties, ensuring that the collection of such duties is efficient and that trade is facilitated. The Customs Act 1901 was enacted by the Parliament of Australia and aims to provide clear guidelines for the imposition and collection of customs duties, as well as to offer concessions where appropriate to support trade and industry. The Tariff Concession Order No. 1045334, made under the authority of the Act, addresses specific instances where certain goods, in this case certain transit assembly frames and/or stay plates, are granted a tariff concession, reducing the customs duty from the general rate to free, thereby supporting the policy objective of facilitating trade by reducing the financial burden on importers of these goods.
Scope and Application
The Tariff Concession Instrument No. 1045334 under the Customs Act 1901 applies to goods specifically identified in the application, in this case certain transit assembly frames and/or stay plates, submitted by Macwill Roxtec on 07 October 2010. The instrument is applicable to the person or entity that applied for the tariff concession, which in this instance is Macwill Roxtec. The scope of the Act extends to ensuring that no substitutable goods were produced in Australia at the time the application was lodged, thereby allowing for the concession to be granted. The application and the subsequent order are governed by Commonwealth law and are not restricted by state or territory boundaries, meaning they have a national reach within Australia. However, the Act excludes goods specified in section 269SJ from being subject to a TCO, ensuring that certain categories of goods are not eligible for tariff concessions. The application of the Act may be further refined or extended through subordinate instruments, although no such instruments are indicated in the provided text. The TCO does not affect the rights of any person other than the Commonwealth and does not impose any liabilities on any person, providing a clear benefit to the importers of the specified goods by reducing their duty obligations.
Key Provisions
The main sections of the Customs Act 1901 that are relevant to Tariff Concession Orders (TCOs) are sections 269C, 269F, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of certain goods. Section 269C stipulates that an application for a TCO will meet the core criteria if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. If the CEO is satisfied that the application meets these core criteria, they must make a written order, known as 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 applies (section 269P). The TCO is taken to have come into force on the day on which the application for the TCO was lodged (section 269S).
The Act imposes several obligations on parties and entities it governs. The CEO must ensure that any TCO application is not in respect of goods specified in section 269SJ of the Act, which lists those goods that cannot be subject to a TCO. If the CEO is satisfied that the application meets the core criteria, they must make a TCO and publish a notice in the Gazette inviting any interested parties to submit any reasons why the TCO should not be made. Additionally, under section 269K, importers of goods subject to a TCO can apply for a refund of duty on those goods imported since the date the TCO is taken to have come into force.
Breaching the requirements of the Customs Act 1901 can result in both civil and criminal penalties. Section 282 of the Act provides for a penalty of up to $22,200 for individuals and up to $111,000 for bodies corporate if they contravene the Act. This includes failing to comply with the provisions related to TCOs. Additionally, section 283 of the Act provides that any person who is convicted of an offence against the Act is liable to imprisonment for up to five years. These penalties are intended to ensure compliance with the legislative requirements and the proper administration of customs duties and tariff concessions.