EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0606250
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 processing lines on 6 April 2006.
Instrument
TCO No 0606250 was made on 30 June 2006. It declares that those certain poultry processing 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 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. 0606250 is taken to have come into force on 6 April 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 Tariff Concession Instrument No. 0606250, enacted in 2006, amends the Customs Act 1901 to address the issue of applying tariff concessions for specific goods, in this case, certain poultry processing lines. This instrument was introduced to facilitate the reduction of customs duties on these goods, thereby potentially benefiting importers by lowering the costs associated with importing these specific items. The instrument was made under the authority of the Chief Executive Officer of Customs, in accordance with the legislative framework established by the Customs Act 1901. The underlying policy objective is to support Australian businesses by reducing the tariff burden on certain imported goods, thereby enhancing their competitiveness in the market.
Scope and Application
The Tariff Concession Instrument No. 0606250 applies to goods specified in the instrument, namely certain poultry processing lines, and is administered under Part XVA of the Customs Act 1901. The Act allows for Tariff Concession Orders (TCOs) to be made by the Chief Executive Officer of Customs, granting lower rates of customs duty on goods that meet certain criteria. This particular TCO applies to Inghams Enterprises Pty Ltd's application for tariff concessions on certain poultry processing lines. The application was accepted on 30 June 2006, based on the CEO's determination that no substitutable goods were produced in Australia at the time of application, fulfilling the core criteria as outlined in section 269C of the Act. The TCO declares that these specific poultry processing lines are subject to item 50 of Schedule 4 of the Customs Tariff Act 1995, with a duty rate of 0% instead of the general rate of 5%. The instrument has a national jurisdictional reach, applying throughout Australia as it is an instrument under the Commonwealth Customs Act. No exclusions or exemptions are stated in the TCO, but the Act itself excludes certain goods from eligibility as specified in section 269SJ. The application of the TCO is further defined and potentially extended through subordinate instruments and regulations, such as those detailed in the Customs (Tariff) Regulations 1999.
Key Provisions
The Tariff Concession Instrument No. 0606250 under the Customs Act 1901 (the Act) (s. 269C) establishes a concession on the customs duty for certain poultry processing lines. According to this instrument, these particular goods are subject to a 0% customs duty rate, which is significantly lower than the general rate of 5% (s. 269P(3)). The instrument was issued on 30 June 2006, and it is considered effective from 6 April 2006, the date the application for the concession was lodged (s. 269S(1)).
Entities and individuals governed by this Act must adhere to several obligations. Firstly, they must ensure that the goods in question are not substitutable by any goods produced in Australia in the ordinary course of business on the day the application was made (s. 269C). If the Chief Executive Officer of Customs (the CEO) is satisfied that this criterion is met, a Tariff Concession Order (TCO) will be issued. Additionally, the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any person to lodge a submission if they believe there are reasons why the TCO should not be made (s. 269K(1)). In this case, no submissions were received, leading to the issuance of the TCO.
Failure to comply with the requirements of the Customs Act 1901 may result in legal consequences. While the explanatory statement does not specify particular offences or penalties for breaching the TCO, general provisions of the Act may apply. These could include fines or imprisonment, depending on the nature and severity of the breach. The Act also allows for civil and criminal penalties for non-compliance with customs regulations, including substantial fines and imprisonment terms as stipulated in relevant sections of the Act.
The Tariff Concession Instrument No. 0606250 does not affect the rights of any person, except the Commonwealth, as at the date of registration in a way that would disadvantage that person or impose liabilities in respect of anything done or omitted to be done before the date of registration. However, it does provide benefits to importers by enabling them to apply for a refund of duty on goods imported since the TCO came into force (s. 126(1)(r) of the Regulations). This ensures that the rights of importers are beneficially affected while maintaining the integrity and purpose of the Act.