EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0516763
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.
Inghams Enterprises Pty Ltd applied for a TCO in respect of certain poultry leg deboning lines on 8 December 2005.
Instrument
TCO No 0516763 was made on 03 March 2006. It declares that those certain poultry leg deboning 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. 0516763 is taken to have come into force on 8 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 Customs Act 1901 was enacted by the Australian Parliament and provides a framework for the regulation of customs and excise duties. One specific aspect of the Act is the ability to create Tariff Concession Orders (TCOs) which can reduce the rate of customs duty on certain goods. The Tariff Concession Instrument No. 0516763, made under the authority of the Customs Act 1901, was introduced to address the issue of providing tariff concessions for goods that do not have substitutable Australian-made alternatives. This instrument was made in response to an application by Inghams Enterprises Pty Ltd for a tariff concession on poultry leg deboning lines, where the Chief Executive Officer of Customs determined that no substitutable goods were produced in Australia. As a result, the instrument declares that these goods are subject to a free rate of duty, down from the general rate of 5%. The instrument came into effect on the date the application was lodged, 8 December 2005, and did not disadvantage any existing rights or impose new liabilities on persons other than the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0516763 under the Customs Act 1901 applies to specific goods, in this instance certain poultry leg deboning lines, and it is enacted to provide a concession on the rate of customs duty for those goods. This instrument is designed for entities involved in the importation of these goods, offering them a lower rate of customs duty as specified in the instrument. The instrument's geographic reach is aligned with the Commonwealth of Australia, as it operates under the legislative framework established by federal legislation. The application of the Tariff Concession Order (TCO) is subject to certain exclusions and conditions as outlined in the Customs Act 1901, notably that the goods in question must not be substitutable goods produced in Australia. The instrument extends its application through the subordinate instrument mechanism, allowing for specific tariff concessions to be granted under the overarching scheme set out in the Act. The instrument came into force on the date the application was lodged, which is 8 December 2005, and it does not affect any rights or liabilities accrued before this date.
Key Provisions
The primary sections of this legislation (sections 269C, 269P, and 269S) establish the framework for the application and approval process for Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269C stipulates that for an application to meet the core criteria, no substitutable goods must be produced in Australia at the time the application is lodged. Section 269P mandates that if the Chief Executive Officer of Customs (CEO) determines the application meets these criteria, they must issue a written TCO. Section 269S details the effective date of a TCO, which is deemed to be the day the application is lodged.
Under this Act, entities or individuals applying for a TCO must ensure their applications meet the core criteria as outlined in section 269C. The CEO has the responsibility to verify the absence of substitutable goods in Australia and must make a written order if the application is deemed valid. The CEO is also required to publish a notice in the Gazette under section 269K(1), inviting submissions from interested parties regarding the proposed TCO. If no objections are received, the CEO must proceed with the order.
The Act provides for potential consequences in the event of non-compliance with the requirements for issuing TCOs. While specific offences and penalties are not detailed in the provided text, the Act implies that failure to follow the prescribed process or making an erroneous TCO could lead to legal scrutiny or revocation of the concession. Importers who benefit from the TCO may also face repercussions if they do not comply with the conditions set forth for duty refunds under the Regulations.
The Tariff Concession Order No. 0516763, which pertains to certain poultry leg deboning lines, exemplifies the application of these sections. Inghams Enterprises Pty Ltd successfully applied for a TCO on 8 December 2005, resulting in the goods being subject to a duty rate of free, instead of the general rate of 5%. This concession was effective from the date of the application and does not impose any liabilities on persons other than the Commonwealth. Importers of these goods can apply for duty refunds from the date the TCO came into force, highlighting the beneficial impact on those affected by the order.