EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0607586
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.
Alcan Gove Development Pty Ltd applied for a TCO in respect of certain pneumatic air gravity conveyor flow diverters on 28 April 2006.
Instrument
TCO No 0607586 was made on 14 July 2006. It declares that those certain pneumatic air gravity conveyor flow diverters 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 free.
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. 0607586 is taken to have come into force on 28 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 Customs Act 1901, enacted by the Parliament of Australia, provides a framework for the regulation of customs duties and the importation of goods. Specifically, Part XVA of the Act allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO) to reduce customs duties on certain goods. This mechanism was introduced to address the need for flexible tariff measures that could support industry development and economic competitiveness by reducing costs for businesses importing specific goods not produced domestically. Tariff Concession Instrument No. 0607586, made under this Act, aims to provide duty-free treatment for certain pneumatic air gravity conveyor flow diverters, acknowledging the absence of substitutable goods produced in Australia. This initiative ensures that importers of such goods are not disadvantaged by the imposition of tariffs, aligning with the policy objective to support business operations and economic efficiency.
Scope and Application
The Tariff Concession Instrument No. 0607586, made under the Customs Act 1901, applies to the goods specified in the instrument, namely certain pneumatic air gravity conveyor flow diverters, and the entity that applied for the tariff concession, Alcan Gove Development Pty Ltd. The Act permits the Chief Executive Officer of Customs to make Tariff Concession Orders, which provide for a lower rate of customs duty on goods if certain criteria are met. The Instrument was made because no substitutable goods were produced in Australia at the time the application was lodged, satisfying the core criteria under section 269C of the Act. The TCO applies nationally and affects the rights of importers by allowing them to apply for a refund of duty on goods imported since the day the TCO is taken to have come into force, which was 28 April 2006. The TCO does not disadvantage any person or impose liabilities on any person in respect of anything done or omitted to be done before the date of registration. The application of the Act is extended through subordinate instruments, such as the Customs Regulations 1995, which provide for the procedures and conditions under which the Tariff Concession Orders are made and administered.
Key Provisions
The primary sections of this legislation are sections 269C, 269F, 269P, and 269SJ of the Customs Act 1901. Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO) in relation to specific goods, while section 269C outlines the core criteria that the CEO must consider when deciding whether to grant the TCO. Section 269P specifies that if the CEO is satisfied that the application meets these criteria, they must issue a written TCO, and section 269SJ enumerates the goods that cannot be subject to a TCO.
The Customs Act 1901 imposes several obligations on both the applicants and the CEO. For applicants, the main obligation is to submit a valid TCO application, ensuring that it pertains to goods not listed in section 269SJ, and that the core criteria specified in section 269C are met. Once an application is received, the CEO is required to determine whether it meets these criteria and, if so, issue a TCO as per section 269P. Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to submit objections or submissions against the proposed TCO, as required by subsection 269K(1). In this case, no submissions were received.
In terms of legal consequences, the Act does not specify any particular offences, penalties, or civil/criminal consequences for breach of the TCO provisions. However, the Act does provide that any 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 in respect of anything done or omitted to be done before the date of registration. This means that while the TCO may confer benefits to importers by reducing duty rates, it does not retroactively impose any liabilities or disadvantages on those who have already imported or dealt with the goods prior to the TCO's registration date.