EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1051882
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.
Sandvik Mining & Construction Australia Pty Ltd applied for a TCO in respect of certain electrically operated mining loaders on 24 November 2010.
Instrument
TCO No 1051882 was made on 28 February 2011. It declares that those certain electrically operated mining loaders 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. 1051882 is taken to have come into force on 24 November 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 Australian Parliament, establishes a framework under which the Chief Executive Officer of Customs can issue Tariff Concession Orders (TCOs) that provide reduced rates of customs duty on certain goods. This legislative instrument responds to the need for economic incentives and competitive advantages in the importation of specific goods by ensuring that these goods are not subject to higher tariff rates if they are not produced domestically or if there are no suitable domestic substitutes. The policy objective behind this mechanism is to encourage the import of goods that are not locally manufactured, thereby supporting trade and economic activities. The enactment of this Act was intended to provide flexibility in tariff regulation, ensuring that imports are not unduly burdened by high customs duties unless necessary for protecting domestic industries.
Scope and Application
The Tariff Concession Instrument No. 1051882 under the Customs Act 1901 applies to certain electrically operated mining loaders, with the primary objective of providing a tariff concession that lowers the customs duty on these goods. The instrument specifically pertains to entities such as Sandvik Mining & Construction Australia Pty Ltd, which applied for the concession, and any other importers of these goods. The Act governs the process by which such concessions can be sought and granted by the Chief Executive Officer of Customs, provided that the application meets the core criteria set out in the Act, such as the absence of substitutable goods produced in Australia. This concession benefits importers by allowing them to apply for a refund of duty on goods imported since the day the concession is taken to have come into force. The instrument operates within the Commonwealth jurisdiction and does not impose any liabilities on persons other than the Commonwealth. The instrument’s application is limited to the specific goods mentioned and does not affect any rights of persons as at the date of registration, thus preventing any disadvantage or imposition of liabilities for actions taken prior to the registration date.
Key Provisions
The key operative sections of this legislation, specifically Tariff Concession Instrument No. 1051882 under the Customs Act 1901, pertain to the creation and implementation of Tariff Concession Orders (TCOs). Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO concerning certain goods. If the CEO determines that the application is valid and meets the core criteria outlined in sections 269C and 269P(3), a TCO can be issued. This particular TCO, No. 1051882, was made on 28 February 2011 and pertains to certain electrically operated mining loaders, declaring that these goods are subject to a specific item in Schedule 4 of the Customs Tariff Act 1995.
The Act imposes certain obligations and requirements on the parties involved. The CEO must ensure that the application for a TCO does not involve goods specified in section 269SJ, which lists goods that cannot be subject to a TCO. Additionally, the CEO must evaluate whether the application meets the core criteria, specifically if no substitutable goods were produced in Australia in the ordinary course of business, as defined by sections 269D and 269E. If these criteria are met, the CEO must make a written order (TCO) declaring that the goods in question are subject to the specified tariff concession.
Failure to comply with the requirements of the Customs Act 1901 or the terms of a TCO can result in various consequences. While the explanatory statement does not detail specific offences, penalties, or civil/criminal consequences for breach, the general provisions of the Customs Act 1901 include penalties for non-compliance with customs regulations. These can include fines, imprisonment, or both, depending on the severity of the breach. The exact penalties would depend on the specific circumstances and relevant sections of the Customs Act 1901 or other applicable legislation.
In summary, this piece of legislation sets out a structured process for the creation and implementation of Tariff Concession Orders, ensuring that only eligible goods receive tariff concessions. It imposes clear obligations on the CEO to evaluate applications and issue orders where appropriate, while also providing a mechanism for public consultation and notification. Although the explanatory statement does not detail specific penalties, the broader legal framework suggests that non-compliance could result in significant consequences.