EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0602220
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.
Orica Australia Pty Ltd applied for a TCO in respect of certain fertiliser packager plant on 11 January 2006.
Instrument
TCO No 0602220 was made on 24 March 2006. It declares that those certain fertiliser packager plant and 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 0%.
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. 0602220 is taken to have come into force on 11 January 2006.
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, enacted by the Parliament of Australia, provides a framework for the regulation of customs duties and tariffs. Specifically, Part XVA of the Act establishes a scheme for Tariff Concession Orders (TCOs), which can be made by the Chief Executive Officer of Customs (CEO) to reduce customs duty on certain goods. This legislative mechanism was introduced to address the need for targeted tariff reductions that can stimulate economic activity by lowering the cost of specific goods. In response to an application by Orica Australia Pty Ltd, Tariff Concession Order No. 0602220 was made on 24 March 2006, reducing the duty on certain fertiliser packager plant from 5% to 0%. This concession was granted after it was determined that no substitutable goods were produced in Australia, aligning with the core criteria outlined in section 269C of the Act. The order, which came into effect on 11 January 2006, allows eligible importers to apply for a refund of duty on goods imported since the order’s effective date, without imposing any new liabilities.
Scope and Application
The Tariff Concession Instrument No. 0602220 applies to the specific goods identified in the instrument, which are certain fertiliser packager plant. This Act is a subset of the broader Customs Act 1901, under which Tariff Concession Orders (TCOs) are made to provide lower rates of customs duty on specific goods. The legislation applies to any person who meets the core criteria set out in section 269C of the Customs Act 1901 and applies to goods that are not substitutable and are not produced in Australia in the ordinary course of business. The geographic reach of this Act is national, as it is a Commonwealth instrument. The Act does not apply to goods specified in section 269SJ of the Customs Act 1901, which sets out those goods that cannot be subject to a TCO. The Act may extend or restrict application through subordinate instruments, as is common in Australian legislation where detailed regulations are often prescribed separately. The Tariff Concession Instrument No. 0602220 was made under the authority provided by the Customs Act 1901 and came into force on 11 January 2006, the date the application was lodged.
Key Provisions
The Tariff Concession Instrument No. 0602220 operates under sections 269C, 269F, and 269P of the Customs Act 1901. It allows for a concession on customs duty for certain fertiliser packager plant, provided certain criteria are met. Specifically, Section 269F allows for an application to be made to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO). If the CEO is satisfied that the application meets the core criteria, as outlined in Section 269C, they must make a written order that declares the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies, thereby reducing the rate of customs duty.
Entities governed by this Act, such as Orica Australia Pty Ltd, are required to ensure that their applications for TCOs comply with the statutory requirements. This includes demonstrating that no substitutable goods are produced in Australia, as defined by Section 269D. The CEO must also publish a notice in the Gazette inviting submissions from any interested parties (subsection 269K(1)), although in this case, no submissions were received. The obligation to act transparently and consider relevant submissions is an integral part of the process.
Failure to comply with the requirements of the Customs Act 1901 or the Tariff Concession Instrument No. 0602220 may result in various consequences. The Act does not explicitly outline specific offences or penalties for non-compliance with TCOs; however, general provisions within the Customs Act may apply. These could include fines, imprisonment, or other civil or criminal penalties for breaches related to customs duties and regulations. The exact penalties would depend on the specific nature and severity of the breach, as well as the relevant sections of the Customs Act and other applicable legislation.