EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0515638
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.
Australian Coal Technology applied for a TCO in respect of certain membrane chamber filter presses on 22 December 2005.
Instrument
TCO No 0515638 was made on 17 March 2006. It declares that those certain membrane chamber filter presses 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. 0515638 is taken to have come into force on 22 December 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. 0515638 was enacted under the Customs Act 1901, establishing a framework whereby the Chief Executive Officer of Customs can grant tariff concessions on specific goods. This legislation was introduced to address the problem of ensuring that Australian industries can access necessary imported goods without incurring prohibitive customs duties, thereby promoting economic efficiency and competitiveness. The objective of this instrument, as stated in the explanatory statement, is to facilitate the import of goods that do not have substitutable alternatives produced domestically, thereby benefiting importers by potentially reducing their duty liabilities.
The instrument was developed following an application from Australian Coal Technology for tariff concessions on certain membrane chamber filter presses, a decision made by the CEO after verifying that no similar goods were produced in Australia. The instrument came into force on the date the application was lodged, ensuring that the tariff changes were effective retroactively from that date. Importantly, the legislation ensures that the rights of parties are protected, with no retroactive liabilities imposed on individuals or entities, and allows importers to apply for duty refunds on goods imported since the effective date of the concession.
Scope and Application
The Customs Act 1901 applies to various persons and entities involved in the importation and exportation of goods, including individuals, businesses, and government agencies, as well as goods subject to customs duties. The Act operates at a national level, encompassing all states and territories within Australia. It facilitates the imposition of customs duties and the regulation of goods entering or leaving the country. The Act's application extends through Tariff Concession Orders (TCOs), which provide tariff concessions on specific goods, thereby modifying the rates of duty. A TCO applies to the goods specified in the order and is effective from the date the application was lodged. The Act does not apply to goods listed in section 269SJ, which are ineligible for tariff concessions. The scope of the Act is further defined by subsidiary legislation, such as the Customs Tariff Act 1995, which provides the framework for the application of duties on imported goods. The Act does not affect the rights of any person as at the date of registration, ensuring that it does not disadvantage or impose liabilities on individuals or entities in respect of actions taken before the TCO was registered.
Key Provisions
The primary sections of this legislation concern the process and criteria for making Tariff Concession Orders (TCOs) under the Customs Act 1901. Specifically, section 269F outlines the application process, where a person can apply to the Chief Executive Officer of Customs (CEO) for a TCO for certain goods. Section 269C establishes the core criteria for a TCO, requiring that on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. This is further defined by sections 269B, 269D, and 269E which provide definitions for terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods'. Once the CEO is satisfied that the application meets these criteria, they must make a written order (section 269P(3)) declaring the goods to which the concession applies.
The obligations imposed by this legislation on the parties involved primarily concern the CEO. The CEO must assess the application against the core criteria, publish a notice in the Gazette inviting submissions from the public, and decide whether to make a TCO. In this instance, the CEO determined that Australian Coal Technology's application met the criteria, as no substitutable goods were being produced in Australia on the application date. The CEO also ensures that the TCO does not disadvantage any person (other than the Commonwealth) as at the date of registration and does not impose any liabilities on any person. This ensures that the rights of importers will be beneficially affected and that they can apply for a refund of duty on goods imported since the TCO came into force.
The legislation does not explicitly outline specific offences, penalties, or consequences for breach. However, it is clear that the process for making a TCO is stringent and requires the CEO to thoroughly assess applications against the outlined criteria. Failure to comply with these criteria or to properly assess an application could lead to legal challenges or the invalidation of the TCO. Additionally, while the legislation does not impose specific penalties, any failure to adhere to the terms of the TCO or the underlying Customs Act 1901 could result in civil or criminal consequences under the broader customs legislation. This includes potential fines or other penalties that are not explicitly mentioned in this specific instrument but are part of the general customs enforcement framework.