EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0700321
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.
Major Projects Victoria applied for a TCO in respect of certain synchrotron beamlines on 08 January 2007.
Instrument
TCO No 0700321 was made on 23 March 2007. It declares that those certain synchrotron beamlines 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. 0700321 is taken to have come into force on 08 January 2007.
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, was supplemented by the Tariff Concession Order No. 0700321, introduced to address the need for tariff concessions on specific goods. This order was necessitated by an application from Major Projects Victoria for tariff concessions on certain synchrotron beamlines, which are integral for scientific research and development. The problem the legislation aimed to resolve was the high customs duty on these specialised scientific equipment, which could otherwise impede their import and use in Australia. By issuing this order, the Chief Executive Officer of Customs declared that these particular beamlines would benefit from a reduced duty rate, effectively making it free of charge, which aligns with the policy objective of facilitating access to critical scientific infrastructure.
The Tariff Concession Order No. 0700321 was published in the Gazette, inviting any objections to the concession, although none were received. The order came into effect on the date of the application, 08 January 2007, and it ensures that while the rights of importers are positively impacted, no existing rights or liabilities of other parties are adversely affected by the concession. This legislative instrument underscores the government's commitment to supporting significant scientific projects through streamlined customs processes.
Scope and Application
The Customs Act 1901, through its Part XVA, provides a framework for the Chief Executive Officer of Customs to grant Tariff Concession Orders (TCOs) which lower the customs duty on specified goods. This applies to any person who meets the core criteria set out in the Act and seeks to import goods that are not produced in Australia in the ordinary course of business and for which no substitutable goods exist domestically. The geographic reach of this Act is national, applying across Australia as a Commonwealth statute. The TCOs do not disadvantage any person by affecting rights as at the date of registration or impose liabilities for actions prior to the registration date, thereby ensuring that the concessions are forward-looking and do not penalise past transactions. The scope of the Act can be further defined and extended through subordinate instruments, allowing for flexibility in application and adaptation to specific circumstances or sectors. The Explanatory Statement for Instrument No. 0700321 exemplifies this process, detailing how Major Projects Victoria successfully applied for a TCO on certain synchrotron beamlines, resulting in a duty-free status for these specified goods.
Key Provisions
The main operative sections of this legislation concern Tariff Concession Orders (TCOs) under Part XVA of the Customs Act 1901. Section 269F allows for an application to be made to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods, provided that the goods are not specified in section 269SJ, which details goods that cannot be subject to a TCO. If the application meets the core criteria, the CEO must make a written order, as outlined in section 269C, which states that a TCO application meets these criteria if no substitutable goods were produced in Australia on the day the application was lodged. Further definitions relevant to the core criteria are provided in sections 269D, 269E, and 269B.
The Act imposes specific obligations and requirements on the CEO, including the duty to assess whether an application meets the core criteria as per section 269C. If the CEO is satisfied that the application meets these criteria, the CEO must make a written TCO, as stipulated in section 269P(3). Additionally, the CEO is required to publish a notice in the Gazette, inviting submissions from any interested parties who believe the TCO should not be made, as per section 269K(1). Once a TCO is made, it is considered to have come into force on the date the application was lodged, as specified in section 269S(1).
In terms of offences, penalties, or civil/criminal consequences for breaches of this legislation, there are no explicit provisions detailing specific penalties for non-compliance with the TCOs or the process outlined in the Act. However, it is worth noting that the Act ensures the TCO does not affect the rights of any person adversely as at the date of registration, nor does it impose any liabilities on any person, as per the explanatory statement. Any actions taken in reliance on the TCO would be subject to the general provisions of the Customs Act 1901 and any related regulations.