EXPLANATORY STATEMENT
Tariff Concession Instrument No.0503927
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.
Joe White Maltings Pty Ltd applied for a TCO in respect of certain combined turning, loading and unloading machines for malt germination and/or kilns on 1 April 2005.
Instrument
TCO No 0503927 was made on 10 June 2005. It declares that those certain combined turning, loading and unloading machines for malt germination and/or kilns 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. 0503927 is taken to have come into force on 1 April 2005.
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. 0503927, made under the Customs Act 1901, aims to address the need for tariff concessions on specific imported goods by providing reduced customs duty rates. Enacted in 2005 by the Chief Executive Officer of Customs, this instrument was introduced in response to an application by Joe White Maltings Pty Ltd for tariff concessions on certain combined turning, loading, and unloading machines for malt germination and/or kilns. The primary policy objective is to ensure that such tariff concessions do not disadvantage any existing rights or impose liabilities on individuals or entities other than the Commonwealth. The instrument became effective on 1 April 2005, and importers of the specified goods can apply for duty refunds from that date, thereby benefiting from the reduced duty rate of 0% under the Customs Tariff Act 1995.
Scope and Application
The Tariff Concession Instrument No. 0503927, made under section 269F of the Customs Act 1901, applies to the goods specified in the instrument, namely certain combined turning, loading, and unloading machines for malt germination and/or kilns. The instrument is applicable to any person or entity importing these goods into Australia. The legislation provides a reduced rate of customs duty for these specific goods, contingent upon the application meeting the core criteria set out in the Customs Act, specifically that no substitutable goods were produced in Australia on the day the application was lodged. The instrument's jurisdictional reach is national, governed by the Commonwealth, and it does not affect any existing rights or liabilities incurred prior to the instrument's effective date. Any exclusions or exemptions are outlined in section 269SJ of the Act, which details goods that cannot be subject to a TCO. The instrument, once registered, becomes effective from the date the application was lodged, in this case, 1 April 2005, and the instrument itself was registered on 10 June 2005.
Key Provisions
The Customs Act 1901, specifically under Part XVA, provides a framework for the creation of Tariff Concession Orders (TCOs), as outlined in section 269F. The main operative sections in this context are sections 269C and 269P(3), which establish the criteria for making a TCO. Section 269C stipulates that a TCO can be made if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. If the Chief Executive Officer of Customs (CEO) is satisfied that the application meets these core criteria, they must issue a written order declaring that the specified goods are subject to a prescribed rate of customs duty as per section 269P(3).
The obligations imposed by this legislation on the parties involved, particularly the CEO, are to carefully evaluate TCO applications to ensure that they meet the criteria set out in section 269C. This includes verifying that no substitutable goods are produced in Australia. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any interested parties who may object to the TCO, as per subsection 269K(1). In this instance, the CEO did not receive any submissions in response to the notice published for TCO No. 0503927.
In terms of consequences for breach, the Customs Act 1901 does not explicitly outline criminal offences or penalties for non-compliance with the TCO provisions. However, the Act does ensure that the rights of persons, other than the Commonwealth, are not adversely affected by the TCO as at the date of registration. The Act further stipulates that the TCO does not impose any liabilities on any person, thereby protecting individuals and entities from financial repercussions related to the concession. Importers, however, can benefit from this legislation by applying for a refund of duty on goods imported since the day the TCO is taken to have come into force, as per paragraph 126(1)(r) of the Regulations.