EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0619718
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.
Inghams Enterprises Pty Ltd applied for a TCO in respect of certain poultry meat cooking lines on 14 December 2006.
Instrument
TCO No 0619718 was made on 09 March 2007. It declares that those certain poultry meat cooking lines 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. 0619718 is taken to have come into force on 14 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 Customs Act 1901, enacted by the Parliament of Australia, establishes a framework for the administration of customs duties and includes provisions for the creation of Tariff Concession Orders (TCOs). These orders allow for the application of reduced customs duty rates on specified goods, provided certain criteria are met. The 2007 Tariff Concession Instrument No. 0619718 was introduced to address a specific application from Inghams Enterprises Pty Ltd regarding certain poultry meat cooking lines. The Chief Executive Officer of Customs was satisfied that no substitutable goods were produced in Australia, meeting the core criteria outlined in the Act. As a result, the instrument declares that the specified poultry meat cooking lines are subject to a free rate of duty, as opposed to the general rate of 5%, and this concession is effective from the date the application was lodged, 14 December 2006. The instrument aims to ensure that the rights of importers are advantageously affected and that no new liabilities are imposed on any person due to the implementation of the concession.
Scope and Application
The Tariff Concession Instrument No. 0619718, made under the Customs Act 1901, applies to goods specified in the instrument, namely certain poultry meat cooking lines. This Act governs the process for granting tariff concessions for goods that are not produced in Australia in the ordinary course of business, thereby allowing for reduced or free customs duty on these imported goods. The application for such concessions is made by a person to the Chief Executive Officer of Customs (CEO), who must determine if the application meets the core criteria outlined in the Act. Specifically, Section 269C of the Act mandates that no substitutable goods were produced in Australia on the day the application was lodged. This instrument is effective from 14 December 2006, the date the application was lodged, and does not disadvantage any person who was not the Commonwealth, nor does it impose any liabilities on individuals other than the Commonwealth. The TCO benefits importers by allowing them to apply for a refund of duty on goods imported since the effective date of the concession. The instrument’s scope is limited to the specific goods detailed in the application, and any broader application or interpretation would require further legislative action.
Key Provisions
The main operative sections of the Customs Act 1901, as applied in Tariff Concession Instrument No. 0619718, involve the creation and application of Tariff Concession Orders (TCOs) under sections 269C, 269F, 269K, and 269P. Specifically, section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of goods. If the CEO determines that the application meets the core criteria set out in section 269C, and no substitutable goods are produced in Australia as per section 269P(3), the CEO must make a written order declaring that the goods in question are subject to a specified item of Schedule 4 to the Customs Tariff Act 1995. Section 269K mandates that the CEO must publish a notice in the Gazette, inviting submissions on the application, though in this case, no submissions were received.
Under the Act, the CEO has a duty to assess TCO applications to ensure that the core criteria are met. This involves determining whether there are substitutable goods produced in Australia that correspond to the goods in question. If the CEO is satisfied that the core criteria are met and no substitutable goods are produced, they must make a TCO. Additionally, the CEO is required to publish a notice in the Gazette inviting any interested parties to submit their views on the application. The obligations extend to ensuring that the TCO does not disadvantage any person other than the Commonwealth and does not impose liabilities for actions taken prior to the registration of the TCO.
Any breach of the requirements set out in the Customs Act 1901 may result in civil or criminal penalties, depending on the nature and severity of the breach. The Act does not specify maximum penalties within the explanatory statement, but generally, breaches of customs regulations can lead to fines or imprisonment under the various sections of the Act. Additionally, any person who knowingly makes a false statement or representation in an application for a TCO could face criminal charges, including potential imprisonment. The penalties underscore the importance of compliance with the statutory requirements and the obligations placed on applicants and the CEO.