EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0619711
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.
P & N Beverages Pty Ltd applied for a TCO in respect of certain water deaerators on 13 December 2006.
Instrument
TCO No 0619711 was made on 9 March 2007. It declares that those certain water deaerators 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. 0619711 is taken to have come into force on 13 December 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. 0619711, enacted under the Customs Act 1901, was introduced to address the need for tariff concessions for certain imported goods, in this case, water deaerators, which were subject to a zero rate of customs duty as opposed to the general 5% duty. The Customs Act 1901 provides a framework for the Chief Executive Officer of Customs to make Tariff Concession Orders based on specific criteria, ensuring that such orders only apply if no substitutable goods are produced in Australia. This legislative measure aims to provide relief to businesses importing these specific goods, thereby supporting industry needs and potentially enhancing economic activity by making these goods more competitively priced. The Parliament of Australia enacted this instrument to streamline the process of tariff concessions, ensuring that eligible goods can benefit from reduced duty rates, thereby fostering fair trade practices and supporting economic efficiency.
Scope and Application
The Tariff Concession Instrument No. 0619711, under the Customs Act 1901, applies to specific water deaerators that have been granted a tariff concession order (TCO). This legislation is relevant to entities or individuals involved in the importation of these goods, specifically benefiting importers by reducing the customs duty from the general rate of 5% to 0%. The application of this Act is confined to the Commonwealth level, with the Chief Executive Officer of Customs (CEO) having the authority to make decisions regarding the eligibility for tariff concessions. The instrument extends to the entire nation, but its specific application is limited to the named goods that meet the criteria outlined in the Act. Any goods specified in section 269SJ of the Act, which outlines those goods that cannot be subject to a TCO, are excluded from this concession. The Act allows for the potential extension or restriction of its application through subordinate instruments, although no such instruments are mentioned in the provided text.
Key Provisions
The primary operative sections of the Tariff Concession Order No. 0619711, under the Customs Act 1901, are Sections 269C, 269F, and 269P. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of certain goods. If the CEO is satisfied that the application meets the core criteria specified in Section 269C, they must make a written order that declares the goods to which the TCO applies. Section 269P(3) mandates that if the CEO determines that the application meets the core criteria, they must issue a TCO that specifies the prescribed item of Schedule 4 to the Customs Tariff Act 1995 applicable to the goods.
The Act imposes specific obligations on the CEO, who must ensure that any application for a TCO is valid and meets the core criteria as outlined in Section 269C. The CEO must also publish a notice in the Gazette as soon as practicable after accepting the application as valid, inviting any interested parties to lodge submissions if they believe the TCO should not be made. In this case, the CEO did not receive any submissions. The TCO itself provides for a lower rate of customs duty for the specified goods, and it benefits importers by allowing them to apply for a refund of duty on goods imported since the TCO is deemed to have come into force.
Breaching the obligations or requirements set out in the Customs Act 1901 can lead to various consequences. Under the Act, there are specific offences related to non-compliance with TCO provisions. The maximum penalties for such offences can be substantial, although the exact penalties are not detailed in the explanatory statement. Violators may face both civil and criminal consequences, including fines and imprisonment, depending on the severity of the breach and the specific provisions of the Act. The Act is designed to ensure that the tariff concession scheme operates fairly and effectively, and penalties serve as a deterrent to non-compliance.