EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0608169
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.
Rohlig Australia Pty Ltd applied for a TCO in respect of certain carrot graders and cleaners on 10 May 2006.
Instrument
TCO No 0608169 was made on 21 July 2006. It declares that those certain carrot graders and cleaners 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. 0608169 is taken to have come into force on 10 May 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. 0608169, enacted in 2006, amends the Customs Act 1901 to provide for tariff concessions in respect of certain goods. This instrument was introduced to address the need for tariff concessions on specific imported goods that do not have substitutable alternatives produced in Australia, thereby promoting fair trade practices and supporting Australian industries where local production is not feasible. The instrument was enacted by the Australian Government, as part of the legislative process overseen by the Parliament, with the aim of providing economic benefits by reducing customs duties on certain imported goods. The Customs Act 1901 facilitates the application process for tariff concessions, ensuring that the application criteria are met, and allows the Chief Executive Officer of Customs to make the necessary orders that benefit the economy and specific industries by reducing import costs.
Scope and Application
The Tariff Concession Instrument No. 0608169 under the Customs Act 1901 applies specifically to goods that are subject to a Tariff Concession Order (TCO). This applies to Rohlig Australia Pty Ltd's application for certain carrot graders and cleaners, which were determined to be goods to which item 50 of Schedule 4 to the Customs Tariff Act 1995 applies, with the general duty rate on these goods being 5% but reduced to 0% under the TCO. The Act applies to any person or entity that seeks a TCO for goods not produced in Australia in the ordinary course of business, and not specified under section 269SJ of the Customs Act 1901, which prohibits certain goods from being subject to a TCO. The geographic and jurisdictional reach of this legislation is national, as it falls under the Commonwealth's authority to regulate customs duties. The TCO does not affect the rights of any person except the Commonwealth as at the date of registration and does not impose any liabilities on any person. This legislative instrument extends the application of the Customs Act 1901 by providing for tariff concessions through subordinate instruments like TCOs.
Key Provisions
The primary operative sections of this legislation, specifically Instrument TCO No. 0608169, pertain to Tariff Concession Orders (TCOs) under Part XVA of the Customs Act 1901 (section 269C). This section stipulates that a TCO may be granted if the Chief Executive Officer (CEO) of Customs determines that no substitutable goods are produced in Australia in the ordinary course of business on the day the application is lodged. Section 269P(3) then mandates that if the CEO is satisfied that the application meets the core criteria, they must make a written order declaring the goods to which the concession applies. In this instance, TCO No. 0608169 was made on 21 July 2006, declaring that certain carrot graders and cleaners are subject to a 0% duty rate instead of the general 5% rate.
The obligations imposed by the Act and the TCO on the parties or entities it governs include ensuring that any goods subject to a TCO application are not substitutable by any goods produced in Australia. The CEO of Customs must assess the application against these criteria and, if satisfied, issue the TCO. Furthermore, the CEO is required to publish a notice in the Gazette (subsection 269K(1)) inviting submissions from any interested parties as to why the TCO should not be made. In this case, no submissions were received. The commencement date of the TCO is the date the application was lodged (subsection 269S(1)), which was 10 May 2006 for this instrument. The TCO does not affect the rights of any person as at the date of registration in a way that would disadvantage them or impose liabilities for actions taken before the registration date.
In terms of breaches and penalties, the Customs Act 1901 and the associated Regulations do not specify particular offences or penalties for failing to comply with the TCO provisions. However, general provisions of the Customs Act could apply, where breaches may lead to civil or criminal penalties. For example, knowingly making a false statement in a customs document or failing to comply with an order could result in penalties, including fines and imprisonment. The maximum penalties for such offences can vary, but they may include substantial fines and imprisonment terms depending on the severity and intent of the breach. It is essential for entities and individuals to ensure compliance with the TCO and other customs regulations to avoid any legal repercussions.