EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0603548
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.
Zinifex Ltd applied for a TCO in respect of certain zinc roasting plant on 8 February 2006.
Instrument
TCO No 0603548 was made on 21 April 2006. It declares that those certain zinc roasting plant 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. 0603548 is taken to have come into force on 8 February 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 was enacted by the Australian Parliament to establish a comprehensive framework for customs and excise duties, and it includes provisions for Tariff Concession Orders (TCOs). These orders, introduced under Part XVA of the Act, provide a mechanism for the Chief Executive Officer of Customs to apply lower rates of customs duty on specified goods, subject to certain conditions. The Tariff Concession Instrument No. 0603548, made in 2006, is an example of such an order. This instrument was introduced to address the specific needs of businesses such as Zinifex Ltd, which applied for a TCO for certain zinc roasting plant. The policy objective of this legislative framework is to facilitate the importation of goods by reducing customs duty rates where appropriate, thereby supporting industry and economic growth while ensuring that the rights of all parties, particularly importers, are protected.
Scope and Application
The Customs Act 1901, specifically Part XVA, establishes the framework for Tariff Concession Orders (TCOs) which provide for reduced customs duties on certain goods. These orders can be applied for by any person and are subject to approval by the Chief Executive Officer of Customs (CEO), provided they meet the core criteria outlined in the Act, such as the absence of substitutable goods produced in Australia. This particular TCO, No. 0603548, was applied for by Zinifex Ltd on 8 February 2006, concerning certain zinc roasting plant. The CEO granted the TCO on 21 April 2006, effective from the application date, reducing the duty on these specific goods from 5% to 0%. The TCO does not disadvantage any person other than the Commonwealth and does not impose any new liabilities, although it does entitle importers to a refund of duty paid on the goods since the effective date of the TCO. This legislation applies at a national level, and its scope is limited to the goods specified in the TCO, ensuring that no exclusions or exemptions apply to the particular items covered by this order.
Key Provisions
The Tariff Concession Order (TCO) No. 0603548 under the Customs Act 1901 (section 269F) was issued by the Chief Executive Officer of Customs (CEO) on 21 April 2006, following an application by Zinifex Ltd on 8 February 2006 for tariff concessions on certain zinc roasting plant. The order specifies that these particular goods are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, effectively reducing the duty rate from the general 5% to 0%. This reduction in duty is contingent upon the CEO's satisfaction that no substitutable goods were being produced in Australia on the day the application was lodged (section 269C).
Under this legislation, the CEO has specific obligations when handling applications for TCOs. The CEO must first determine if the application pertains to goods listed in section 269SJ, which are ineligible for TCOs. If not, the CEO must assess whether the application meets the core criteria, primarily ensuring that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (section 269C). If these criteria are satisfied, the CEO is mandated to make a written order declaring the goods to which the prescribed tariff item applies (subsection 269P(3)).
The Customs Act 1901 imposes on applicants the responsibility of ensuring that their applications are valid and meet all stipulated criteria. The CEO, on the other hand, must diligently verify the application's eligibility and publish a notice in the Gazette inviting submissions from interested parties (subsection 269K(1)). Failure to comply with these obligations may result in the denial of the tariff concession. Moreover, the Act ensures that the TCO does not adversely affect the rights of any person as they stood on the date of registration, nor does it impose any new liabilities on individuals other than the Commonwealth (subsection 269S(1)).
The Act does not explicitly outline specific offences or penalties for breaches related to TCOs, but general provisions of the Customs Act 1901 may apply. For example, any misrepresentation or fraud in the application process could potentially lead to civil or criminal penalties. Additionally, any failure to comply with customs duties or other obligations could result in fines or other penalties as prescribed by the Customs Act 1901 and the Customs Regulations 1999.