EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0701083
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.
GE Betz Pty Ltd applied for a TCO in respect of certain water filtration and purification plant on 19 January 2007.
Instrument
TCO No 0701083 was made on 13 April 2007. It declares that those certain water filtration and purification plant 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. 0701083 is taken to have come into force on 19 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 Tariff Concession Instrument No. 0701083, enacted under the Customs Act 1901, addresses the need for tariff concessions on certain goods imported into Australia. This instrument was introduced to provide a reduced rate of customs duty for specific water filtration and purification plant, thereby facilitating the import of these goods at a lower cost compared to the general duty rate. The Customs Act 1901, administered by the Chief Executive Officer of Customs, allows for the creation of Tariff Concession Orders (TCOs) to achieve this objective, provided the goods are not substitutable by Australian-produced goods. The policy objective is to support industries by reducing the cost of importing specific goods that are not produced domestically. The instrument was made on 13 April 2007 and came into effect on 19 January 2007, the date the application was lodged, with no submissions received against the concession.
Scope and Application
The Customs Act 1901 provides for the issuance of Tariff Concession Orders (TCOs) that may lower the rate of customs duty applied to specific goods. The Act applies to the Chief Executive Officer of Customs (CEO), who has the authority to grant these orders if certain criteria are met, specifically when the goods in question are not produced in Australia in the ordinary course of business and there are no substitutable goods available. The legislation applies nationally across Australia and is applicable to any person or entity wishing to import goods that may qualify for a tariff concession. The scope of the Act can be extended through subordinate instruments which may specify additional criteria or details regarding the application and approval process for TCOs. Notably, the Act does not disadvantage any person by affecting their rights as they stood before the date of the TCO registration and does not impose any liabilities on individuals or entities for actions taken prior to the registration date. The rights of importers are positively affected as they may apply for a refund of duty on goods imported since the date the TCO is considered to have come into effect.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0701083, under the Customs Act 1901, are primarily found in sections 269C, 269F, and 269P. Section 269F allows for the application for a Tariff Concession Order (TCO) by a person to the Chief Executive Officer of Customs (CEO) if certain conditions are met. Section 269C stipulates that the CEO must consider whether the application meets the core criteria, which include ensuring that no substitutable goods were produced in Australia on the day the application was lodged. If the CEO is satisfied that the application meets these criteria, section 269P requires the CEO to make a written order, declaring that the goods in question are subject to the TCO.
The obligations and requirements imposed by this Act on the parties or entities it governs are primarily procedural. An applicant must ensure that their application is lodged correctly and that the goods specified do not have any substitutable goods produced in Australia. The CEO is obligated to review the application, consider any submissions, and make a decision based on whether the core criteria are met. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any interested parties, as outlined in section 269K(1). If no submissions are received, as in this case, the CEO proceeds to make the TCO.
In terms of offences, penalties, or civil/criminal consequences for breach, the Act does not explicitly detail specific penalties for failing to comply with the TCO provisions. However, it is understood that non-compliance with customs regulations can lead to significant legal repercussions, including fines and potential criminal charges. The severity of penalties would depend on the nature and extent of the breach, with potential civil penalties including monetary fines and criminal penalties including imprisonment. The exact maximum penalties would be governed by other relevant legislation, such as the Crimes Act 1914, and would depend on the specific circumstances of the breach.