EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0603566
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.
Imexco Australia Pty Ltd applied for a TCO in respect of certain live poultry loaders on 9 February 2006.
Instrument
TCO No 0603566 was made on 28 April 2006. It declares that those certain live poultry loaders 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. 0603566 is taken to have come into force on 9 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, enacted by the Australian Parliament, establishes a framework for the imposition and collection of customs duty on goods imported into Australia. Part XVA of the Act introduces the concept of Tariff Concession Orders (TCOs), which allow for reduced customs duty rates on certain goods under specific conditions. The purpose of this legislative mechanism is to support Australian industries by reducing the cost of imported goods that have no local substitutes, thereby encouraging domestic production and consumption. The Tariff Concession Instrument No. 0603566, made under the authority of the Customs Act, exemplifies this framework by providing a tariff concession for certain live poultry loaders, reducing their duty rate from 5% to 0%. The instrument was introduced following an application by Imexco Australia Pty Ltd, and after considering the core criteria, the Chief Executive Officer of Customs determined that no substitutable goods were produced in Australia. The policy objective here is to provide a competitive edge to Australian producers by mitigating the impact of cheaper imported alternatives.
Scope and Application
The Tariff Concession Instrument No. 0603566 under the Customs Act 1901 applies to individuals or entities seeking a reduction in customs duty for specific goods, in this case, certain live poultry loaders. The Act facilitates applications for Tariff Concession Orders (TCOs) by requiring the Chief Executive Officer of Customs to assess whether the application meets core criteria, primarily focusing on the absence of substitutable goods produced in Australia. The TCO, once approved, applies a lower rate of customs duty, in this instance, reducing the duty from the general rate of 5% to 0%. The geographic reach of this Act is national, as it pertains to the customs duties governed by the Commonwealth of Australia. Notably, the Act excludes certain goods from being subject to a TCO, as specified in section 269SJ of the Customs Act 1901. The TCO's application is effective from the date the application was lodged, ensuring that no existing rights or liabilities are adversely affected by the concession. The legislative framework allows for the CEO to make further orders or modifications through subordinate instruments, thus extending or restricting the application as necessary.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0603566 under the Customs Act 1901 (section 269P(3)) declare that certain live poultry loaders are goods to which item 50 of Schedule 4 to the Tariff applies. This declaration was made on 28 April 2006 by the Chief Executive Officer of Customs (CEO), following an application by Imexco Australia Pty Ltd on 9 February 2006. This means that the general rate of duty on these goods, which is normally 5%, is reduced to 0% for those subject to the Tariff Concession Order (TCO). This change in duty rate is applicable from the date the TCO was lodged, 9 February 2006, as per subsection 269S(1) of the Act.
The obligations imposed by the Act on the parties involved, primarily Imexco Australia Pty Ltd and the CEO, are structured around the application and assessment process for a TCO. Imexco Australia Pty Ltd must submit an application to the CEO, which must include sufficient information to demonstrate that the goods in question are eligible for a tariff concession, specifically that no substitutable goods are produced in Australia (section 269C). The CEO, upon receiving the application, has the duty to evaluate it against the core criteria set out in section 269C and, if satisfied, to make a written order declaring the goods eligible for the tariff concession (section 269P(3)). Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not proceed, although no submissions were received for this particular TCO (subsection 269K(1)).
The Act does not explicitly state specific offences, penalties, or civil/criminal consequences for breach in relation to the TCO process itself. However, the general framework of the Customs Act 1901 does include provisions for penalties and enforcement actions in case of non-compliance with customs regulations. These may include fines, imprisonment, or both, depending on the nature and severity of the breach. The specific penalties would be determined in accordance with the general provisions of the Customs Act and related legislation, which provide for a range of sanctions for non-compliance with customs duties and related obligations.