EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0511073
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.
Ingham Enterprises Pty Ltd applied for a TCO in respect of certain poultry hatchery lines on 22 August 2005.
Instrument
TCO No 0511073 was made on 04 November 2005. It declares that those certain poultry hatchery lines 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. 0511073 is taken to have come into force on 22 August 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. 0511073 was enacted in 2005 under the Customs Act 1901 to provide tariff concessions for certain goods, specifically addressing the gap in tariff rates for goods that are not produced domestically. This instrument was introduced to facilitate trade by reducing the customs duty on imported goods, thereby promoting economic efficiency and competitiveness. The Customs Act 1901 empowers the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) if certain criteria are met, such as the absence of substitutable goods produced in Australia. The enactment body responsible for this legislation is the Australian Parliament, with the policy objective being to support Australian importers by providing lower duty rates for specific goods, thereby enhancing their ability to compete in the market. This approach ensures that importers are not disadvantaged by high tariffs on goods that are not domestically produced.
Scope and Application
The Tariff Concession Instrument No. 0511073 pertains to the application of the Customs Act 1901, specifically under Part XVA, which allows the Chief Executive Officer of Customs (CEO) to issue Tariff Concession Orders (TCOs) to reduce the customs duty on certain imported goods. This Act applies to individuals or entities seeking tariff concessions for specific goods, provided these goods are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. The process involves an application to the CEO, followed by a determination based on whether substitutable goods are produced in Australia, as defined by sections 269C, 269D, and 269E of the Act. Once the CEO determines that the core criteria are met, they issue a TCO that specifies the reduced duty rate applicable to the goods. In the case of Ingham Enterprises Pty Ltd, a TCO was granted for certain poultry hatchery lines, reducing the duty rate from 5% to free. The Act’s jurisdictional reach is national, applying across Australia, and it does not disadvantage or impose liabilities on any person other than the Commonwealth. The TCO’s commencement date aligns with the application date, and importers may apply for duty refunds on goods imported since this date. The CEO is also mandated to consult with the public, inviting submissions against the TCO, although in this instance, no submissions were received.
Key Provisions
The main operative sections of this legislation pertain to the process and criteria for making a Tariff Concession Order (TCO) under the Customs Act 1901. Section 269F allows any person to apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of goods. If the application is not in respect of goods that are specifically excluded under section 269SJ, the CEO must determine whether the application meets the core criteria outlined in section 269C. This section stipulates that an application meets the core criteria if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. The CEO's satisfaction of these criteria leads to the issuance of a written order, the TCO, under section 269P(3).
The obligations imposed by this Act on the parties or entities it governs primarily concern the process of applying for and determining TCOs. The CEO of Customs must ensure that the application does not pertain to excluded goods, as specified in section 269SJ. The CEO must also verify that the core criteria set out in section 269C are met, which includes checking that no substitutable goods were produced in Australia on the day the application was lodged. Additionally, as per section 269K(1), the CEO must publish a notice in the Gazette inviting any interested parties to submit objections if they believe the TCO should not be made. Once a TCO is issued, it affects the rights of importers beneficially, allowing them to apply for a refund of duty on goods imported since the effective date of the TCO under paragraph 126(1)(r) of the Regulations.
In terms of penalties or consequences for breaches, the explanatory statement does not explicitly mention any specific offences, penalties, or consequences within the text. However, it is implied that any failure to comply with the criteria set out in the Act or the regulations could potentially result in legal actions or administrative penalties. For example, if a TCO is issued in error due to non-compliance with the statutory criteria, the TCO could be subject to judicial review or other corrective measures. Importers who do not properly apply for duty refunds under the TCO might also face administrative penalties if they do not adhere to the regulations governing such applications.
The explanatory statement clarifies that the TCO does not affect the rights of any person other than the Commonwealth as at the date of registration and does not impose any liabilities on any person other than the Commonwealth in respect of actions taken before the date of registration. Therefore, the primary focus is on ensuring that the process and criteria for issuing TCOs are strictly adhered to, rather than detailing specific penalties for non-compliance.