EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0606983
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.
Dow AgroSciences Australia Ltd applied for a TCO in respect of certain insecticides on 18 April 2006.
Instrument
TCO No 0606983 was made on 7 July 2006. It declares that those certain insecticides 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. 0606983 is taken to have come into force on 18 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. 0606983, enacted in 2006, is an instrument made under the Customs Act 1901. It was introduced to provide a concession on customs duty for certain insecticides, as requested by Dow AgroSciences Australia Ltd. This instrument was formulated to address the gap in tariff concessions for specific imported goods not produced domestically, ensuring a fair application of the tariff scheme. Enacted by the Chief Executive Officer of Customs, the policy objective of this instrument is to facilitate trade by reducing the duty on these goods, thereby benefiting importers and aligning with the broader economic policy of promoting trade efficiency. The instrument ensures that the rights of existing parties are not adversely affected, and it takes effect from the date the application was lodged, in this case, 18 April 2006.
Scope and Application
The Customs Act 1901, through its Part XVA, establishes a framework for the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. These TCOs apply to goods that qualify for a lower rate of customs duty, as determined by the CEO, provided that the application meets specific core criteria such as the absence of substitutable goods produced in Australia. The legislation allows individuals or entities, such as Dow AgroSciences Australia Ltd, to apply for a TCO for particular goods, including insecticides, by demonstrating that no equivalent goods are produced domestically. The application process requires the CEO to consider whether the goods in question are substitutable and produced in Australia, as defined under sections 269D and 269E, and to ensure that the goods do not fall under the list of excluded items specified in section 269SJ. The TCO is effective from the date the application is lodged, and it does not impose any liabilities on any person other than the Commonwealth, though it does entitle importers to a refund of duty under specific regulatory provisions. The CEO is mandated to publish notices inviting submissions on TCO applications, though no objections were received for TCO No. 0606983.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0606983 under the Customs Act 1901 (section 269F) require the Chief Executive Officer of Customs (CEO) to consider applications for Tariff Concession Orders (TCOs) that reduce customs duty rates for specific goods. If the CEO is satisfied that the application meets the core criteria, such as the absence of substitutable goods produced in Australia (section 269C), a TCO will be issued. This particular TCO (section 269P(3)) applies to certain insecticides, reducing the duty from 5% to 0%. The CEO must publish a notice in the Gazette inviting submissions if there are concerns about the TCO being granted (section 269K(1)), though no submissions were received for this particular TCO.
The Act imposes specific obligations on the parties involved. The applicant, such as Dow AgroSciences Australia Ltd in this case, must submit a valid application detailing the goods for which the concession is sought. The CEO is required to assess the application against the core criteria and decide whether to issue a TCO. The CEO must also publish a notice in the Gazette to allow for any objections to the TCO (section 269K(1)). The TCO will only come into effect from the date the application was lodged (section 269S(1)), and it does not affect any existing rights or liabilities incurred before the registration date.
Failure to comply with the provisions of the Customs Act 1901 may result in various civil or criminal consequences. The Act does not explicitly state the penalties for non-compliance with TCOs, but general provisions of the Customs Act and related regulations could apply. These might include fines or other sanctions for incorrect declarations, fraudulent applications, or misuse of tariff concessions. The severity of penalties would depend on the nature and extent of the breach, and could potentially include imprisonment for serious offences.
In summary, Tariff Concession Instrument No. 0606983 effectively reduces the customs duty on certain insecticides, providing a benefit to importers of these goods. The process involves a thorough assessment by the CEO, public notice, and adherence to the criteria set out in the Customs Act 1901. The instrument outlines clear obligations for applicants and the CEO, and while specific penalties for non-compliance are not detailed, general provisions of the Act may apply.