EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0606998
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 0606998 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. 0606998 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. 0606998 was introduced under the Customs Act 1901 to address the need for reduced customs duty rates on certain goods, in this case specific insecticides, when no substitutable goods are produced in Australia. This instrument was enacted to facilitate tariff concessions for goods that are not domestically produced and thus not available as alternatives. The instrument was introduced by the Chief Executive Officer of Customs, who is responsible for determining whether applications for tariff concession orders meet the specified criteria. The primary policy objective behind this instrument is to ensure that importers of these goods are not disadvantaged by high customs duty rates, particularly when the goods in question are not produced locally.
The instrument came into force on 18 April 2006, the same day Dow AgroSciences Australia Ltd applied for the tariff concession. The decision to grant the concession was based on the CEO's determination that no substitutable goods were produced in Australia at the time of the application. Consequently, the rate of duty on the specified insecticides was reduced from 5% to 0%, effective from the date of application. Importantly, the instrument does not impose any liabilities on persons other than the Commonwealth and allows for potential duty refunds for importers of the goods since the commencement date.
Scope and Application
The Tariff Concession Instrument No. 0606998, made under section 269F of the Customs Act 1901, applies to the importation of certain insecticides for which Dow AgroSciences Australia Ltd has applied for a Tariff Concession Order (TCO). This legislation is relevant to any person or entity importing these specified insecticides into Australia, provided they meet the criteria set out in the Act. The scope of this Act extends to ensuring that a lower rate of customs duty applies to these goods if the Chief Executive Officer of Customs determines that no substitutable goods were produced in Australia in the ordinary course of business. The application of this Act is national in reach, as it is a Commonwealth legislation. There are exclusions within the Act, notably concerning goods specified in section 269SJ, which cannot be subject to a TCO. The application and interpretation of this Act may be further detailed through subordinate instruments, such as regulations, although these are not explicitly mentioned in the provided explanatory statement.
Key Provisions
The Tariff Concession Order No. 0606998, issued under section 269F of the Customs Act 1901, pertains to the granting of tariff concessions for certain insecticides. Specifically, this order, as outlined in section 269P(3), declares that these insecticides are subject to item 50 of Schedule 4 of the Customs Tariff Act 1995, resulting in a duty rate of 0% instead of the general rate of 5%. This legislative instrument is effective from 18 April 2006, the date on which the application for the tariff concession was lodged, as stipulated in subsection 269S(1).
Under the Customs Act 1901, the Chief Executive Officer of Customs (CEO) must ensure that certain conditions are met before granting a tariff concession order. As per section 269C, a tariff concession application qualifies if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Additionally, definitions provided in sections 269D and 269E clarify the terms "goods produced in Australia" and "ordinary course of business." In this case, the CEO was satisfied that the insecticides in question met these criteria, resulting in the issuance of Tariff Concession Order No. 0606998.
The obligations imposed by the Customs Act 1901 on parties and entities governed by this legislation include the requirement for the CEO to assess tariff concession applications against the core criteria set out in section 269C. The CEO must also ensure compliance with subsection 269K(1), which mandates publishing a notice in the Gazette to invite submissions from interested parties regarding the proposed tariff concession. In this instance, the CEO published a notice inviting submissions regarding the insecticides tariff concession, but no submissions were received. Additionally, the Act mandates that tariff concession orders do not adversely affect the rights of persons other than the Commonwealth in respect of actions taken before the order's effective date.
For breaches of the Customs Act 1901 or associated regulations, various offences and penalties apply. However, the specific penalties for non-compliance with Tariff Concession Order No. 0606998 are not explicitly stated in the text provided. Generally, breaches of customs legislation may result in civil or criminal penalties, including fines and imprisonment, depending on the nature and severity of the offence. The precise penalties for any breaches related to this tariff concession order would be determined in accordance with the relevant sections of the Customs Act 1901 and any applicable regulations.