Commonwealth Numbered Regulations - Explanatory Statements

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CUSTOMS REGULATIONS (AMENDMENT) 1992 NO. 343

EXPLANATORY STATEMENT

STATUTORY RULES 1992 No. 343

Issued by the Authority of the Minister for Small Business, Construction and Customs

Customs Act 1201

Customs Regulations (Amendment)

Section 270 of the Customs Act 1901 (the Principal Act) provides in part that:

"(1) The Governor-General may make regulations not inconsistent with this Act prescribing all matters which by this Act are required or permitted to be prescribed ... for giving effect to this Act or for the conduct of any business relating to the Customs,..."

The Regulations amend the Customs Regulations (the Regulations) following the Tariff Concessions System amendments to Part XVA of the Principal Act effected by the Customs Legislation (Tariff Concessions and Anti-Dumping) Amendment Act 1992 (the Amendment Act). The amendments:

i)       insert a new refund circumstance in Regulation 126 of the Customs Regulations;

ii)       omit 4 regulations which have become redundant under the new scheme; and

iii)       effect 3 technical amendments to reflect changes in terminology in the new Tariff Concessions System.

Background

The Tariff Concessions System provides for duty free entry of imported goods via a Tariff Concession Order (TCO) when:

a)       no substitutable goods are produced in Australia in the ordinary course of business; or

b)       substitutable goods are produced in Australia but duty free entry of the imported goods is not likely to have a significant adverse effect on the market for the Australian goods.

The Principal Act was amended by the Amendment Act to, amongst other things, give effect to the Government's response to the Industry Commission's report of 8 March 1991 on the Commercial Tariff Concession System. The Amendment Act received the Royal Assent on 30 June 1992. The Tariff Concessions amendments in the Amendment Act commenced by Proclamation on 1 November 1992.

i)       New refund circumstance in regulation 126

Subsection 163(1) of the Principal Act provides in part that refunds, rebates and remissions may be made in such circumstances and subject to such conditions and restrictions as are prescribed. Regulation 126 details the prescribed circumstances for the purposes of section 163.

Under section 269S of the Principal Act, TCO's have a date of effect 28 days prior to the date when the application for that TCO was lodged with the Comptroller-General. Therefore it is possible for a TCO to be made after goods to which it relates have been imported and on which duty has been paid.

Regulation 3 amends regulation 126 to insert a new refund circumstance where duty has been paid on goods at a time when a TCO made in respect of those goods under Part XVA of the Act is in force or is taken to have come into force.

A feature of the new Tariff Concessions System is the introduction of a 2 tier merits review system which involves internal review by Customs and review of certain Tariff Concession decisions by the Administrative Appeals Tribunal (AAT). A consequence of merits review is that a decision on a TCO can be substituted with effect from the operative date of the original decision, which could result in a valid TCO being removed with a retrospective effect.

As Customs will notify in the Gazette when a TCO is at risk because of a request for internal or AAT review, some importers might choose to pay the full amount of duty instead of claiming a free rate on account of the TCO until the review decision is made. If a TCO remains or comes into force after a decision on review, the importer should then be able to apply for a refund of the overpayment of duty in respect of those goods.

Regulation 4 inserts a new subregulation (4A) into regulation 128A to provide that an importer may apply for a refund from the new refund circumstance in new paragraph 126(1)(q) within 12 months after the date on which;

a) the goods were entered for home consumption; or

b) the TCO was gazetted; or

c) a decision on internal review was gazetted;

d) a decision of the AAT is made;

whichever happens last.

This new provision is intended to cover every situation where goods to which a TCO applies have been imported, but the TCO has not been used, and will allow 12 months from the relevant determining event to apply for a refund.

ii)       Omission of 4 regulations

The new Tariff Concessions System removes the requirement for applications for a TCO and notices under Part XVA to include prescribed particulars and introduces the requirement that applications and submissions must be in an "approved form", and contain such information as is required by the form.

Regulations 5, 6, 7 and 8 omit regulations 180, 181, 182 and 183 respectively, as those regulations are now redundant.

iii)       Technical amendments

The new Tariff Concession System refers to "Tariff Concession Orders" or "TCOs" instead of "Commercial Tariff Concession Orders" or "CTCOs".

Regulation 184 defines certain terms for the purposes of regulation 185 and Schedule 2. The definitions in subregulations (1) and (2) are all redundant under the new scheme. Regulation 9 amends regulation 184 to omit subregulations (1) and (2) as redundant and to substitute a new subregulation (1) which provides that in regulation 185 "TCO" has the same meaning as in Part XVA of the Principal Act.

Subsection 269SJ(1) of the Principal Act provides that the ComptrollerGeneral must not make a TCO in respect of goods declared by the Regulations to be goods to which a TCO should not extend.

Regulation 185 and Schedule 2 set out the goods in respect of which a TCO cannot be made.

Regulations 10 and 11 effect technical amendments to regulation 185 and Schedule 2 to reflect the new terminology used in Part XVA of the Principal Act and to correct cross references to the Principal Act provisions.

The Regulations amend the Customs Regulations as follows.

1)       Commencement

Subregulation 1.1       provides for the Regulations to commence on 1 November 1992, which is the date on which the Principal Act amendments to Part XVA are proposed to commence by Proclamation.

2)       Amendment

Subregulation 2.1       is a formal machinery provision which provides that the Customs Regulations are amended as set out in these Regulations.

3)       Regulation 126 (Circumstances under which refunds, rebates and remissions are made)

Subregulation 3.1       amends subregulation 126(1) to provide a new refund circumstance (paragraph (q)) where duty has been paid on goods at a time when a TCO in respect of those goods is in force, or is taken to have come into force.

4)       Regulation 128A (Time for application for refund of duty)

Subregulation 4.1       amends regulation 128A to insert a new subregulation (4A) which prescribes the time limit for applying for a refund in the new circumstance in paragraph 126(1)(q).

An application for refund must be made within 12 months after the date on which:

a)       the goods were entered for home consumption; or

b)       the TCO was gazetted under section 269R; or

c)       a decision on reconsideration under section 269SH was gazetted; or

d)       a decision of the Administrative Appeals Tribunal pursuant to paragraphs 273GA(1)(n), (o), (q) or (r) of the Act was made;

whichever happens last.

5)       Regulation 180 (Interpretation of regulations 181, 182 and 183)

Subregulation 5.1       provides for regulation 180 to be omitted from the Regulations.

•       Regulations 182 and 183 are to be omitted, thereby making the definitions in regulation 180 redundant.

6)       Regulation 181 (Applications for concession orders: particulars prescribed)

Subregulation 6.1       provides for regulation 181 to be omitted from the Regulations.

•       Section 269F now requires an application to be in an approved form and to contain such information as is required by the form.

7)       Regulation 182 (Notices under subsection 269H of the Act: matters Prescribed)

Subregulation 7.1 provides for regulation 182 to be omitted from the Regulations.

•       There is no equivalent in the new Part XVA to the old section 269H notice of intention to lodge an application.

8)       Regulation 183 (Prescribed manner of notice under subsection 269K(1) of the Act)

Subregulation 8.1       provides for regulation 183 to be omitted from the Regulations.

•       Section 269R now provides that any decision on a TCO application must be notified in writing to the applicant.

9)       Regulation 184 (Interpretation of regulation 185 and Schedule 2)

Subregulation 9.1       provides for subregulations (1) and (2) to be omitted;

•       The definitions in these subregulations are all redundant under the new Part XVA;

and substitutes a new subregulation (1) which provides that "TCO" has the same meaning as in Part XVA of the Act.

10)       Regulation 185 (Restrictions an TCOs)

Subregulation 10.1 provides for regulation 185 to be omitted and substitutes a new provision which provides

that for the purposes of subsection 269W(1) TCO's should not extend to goods classified to the Customs Tariff Act 1987, Schedule 3 headings or subheadings listed in Column 2 of Schedule 2 unless they are goods listed in Column 3 as goods to which the restriction does not apply.

•       This amendment corrects the cross references to the Principal Act provision and reflects changes to terminology under the new Part XVA.

11)       Schedule 2 (Goods in respect of which concession orders must not be made)

Subregulation 11.1       provides for the heading to the Schedule to be amended to replace "CONCESSION ORDERS" with "TCOs" to reflect the new terminology in Part XVA of the Principal Act.

12)       Transitional

Subregulation 12.1       is a savings provision which mirrors section 20 of the Customs Legislation (Tariff Concessions and AntiDumping) Amendment Act 1992 to continue the operation of the repealed regulations in relation to each "CTCO" made under Part XVA of the Principal Act before its repeal and substitution by section 10 of the Amendment Act.


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