EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0411355
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.
Austral Wright Metals Pty Ltd applied for a TCO in respect of certain copper plates and/or sheets and/or strip on 2 November 2004.
Instrument
TCO No 0411355 was made on 7 January 2005. It declares that those certain copper plates and/or sheets and/or strip 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 3%.
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. 0411355 is taken to have come into force on 2 November 2004.
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. 0411355, enacted in 2005 under the Customs Act 1901, addresses the need for tariff concessions for specific goods, ensuring that Australian importers benefit from lower customs duties. This legislative instrument was introduced to streamline the process for granting tariff concessions, facilitating trade by reducing the duty on certain imported goods, thereby making them more competitive in the domestic market. The instrument was enacted by the Parliament of Australia with the objective of fostering economic efficiency and enhancing the competitiveness of Australian industries by providing duty concessions where appropriate.
The Customs Act 1901 empowers the Chief Executive Officer of Customs to grant Tariff Concession Orders (TCOs) when certain criteria are met, specifically where no substitutable goods are produced in Australia. In this instance, the TCO was granted to Austral Wright Metals Pty Ltd for certain copper plates and/or sheets and/or strip, reducing the duty rate from 5% to 3%. This concession aims to support the import of these goods by making them more affordable, thus potentially stimulating demand and supporting related industries.
Scope and Application
The Tariff Concession Instrument No. 0411355, under the Customs Act 1901, applies to the specific goods—copper plates, sheets, and strip—that are subject to a Tariff Concession Order (TCO). The Act enables the Chief Executive Officer of Customs to grant tariff concessions to applicants who demonstrate that the goods in question are not being produced in Australia and thus cannot be substituted with locally manufactured alternatives. The instrument was created in response to an application by Austral Wright Metals Pty Ltd on 2 November 2004, and it came into effect on that date. The geographic reach of this legislation is national, applying across all jurisdictions within Australia. However, the benefits of this concession are specifically extended to importers who can apply for duty refunds on goods imported since the TCO came into force. The Act does not disadvantage any person other than the Commonwealth and does not impose any liabilities on any person. Furthermore, subordinate instruments can extend or restrict the application of this Act as necessary.
Key Provisions
The Customs Act 1901 (the Act) under Part XVA, as amended by Tariff Concession Instrument No. 0411355, establishes a framework for the Chief Executive Officer of Customs (the CEO) to issue Tariff Concession Orders (TCOs). These orders apply a reduced rate of customs duty to specified goods, provided certain criteria are met (s 269F). The core criteria, outlined in section 269C, require that no substitutable goods are produced in Australia in the ordinary course of business on the day the application is lodged (s 269C). Definitions for key terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods' are provided in sections 269D, 269E, and 269F respectively. Once the CEO is satisfied that these criteria are met, they must issue a written TCO (s 269P(3)).
The obligations imposed by this Act on the parties include the requirement for applicants to ensure their goods meet the criteria for a TCO and for the CEO to process applications and issue orders where appropriate. Specifically, the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be issued (s 269K(1)). The TCO itself, once issued, applies from the date the application was lodged (s 269S(1)), and does not affect existing rights or impose liabilities on anyone in respect of actions taken prior to the TCO’s effective date (s 269S(2)). The rights of importers are beneficially affected, as they can apply for a refund of duty on goods imported since the TCO’s effective date (Reg 126(1)(r)).
Any failure to comply with the provisions of the Customs Act 1901, including the submission of false information in a TCO application, may result in civil or criminal penalties. Under the Customs Act, offences involving fraud, knowingly importing dutiable goods without payment of duty, or providing false or misleading information can lead to significant fines and imprisonment. The maximum penalties for such offences can vary depending on the severity and intent behind the breach, but can include substantial fines and imprisonment for up to five years as prescribed under the Act and the Crimes Act 1914. The Act also allows for the imposition of administrative penalties for non-compliance with certain requirements, which may include fines and other sanctions as determined by the relevant authorities.