EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0701961
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.
Koppers Arch Wood Protection (Aust) Pty Limited applied for a TCO in respect of certain pentahydrate copper sulphates on 07 February 2007.
Instrument
TCO No 0701961 was made on 04 May 2007. It declares that those certain pentahydrate copper sulphates 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. 0701961 is taken to have come into force on 07 February 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, as amended, provides a framework for the regulation of customs and excise through the administration of tariffs and the control of goods entering and exiting Australia. Specifically, the Act allows for the creation of Tariff Concession Orders (TCOs) to provide relief from customs duty on certain goods. Enacted by the Australian Parliament, the objective of this legislative framework is to ensure fair and efficient trade practices while providing targeted relief to industries that may be disadvantaged by existing tariff structures. The Tariff Concession Instrument No. 0701961, issued in 2007, is an example of how the Act is applied to provide duty concessions to specific imported goods, in this case, pentahydrate copper sulphates, under the condition that no substitutable goods are produced in Australia. This instrument exemplifies the Act's intent to balance economic interests with the broader goals of national trade policy.
Scope and Application
The Tariff Concession Instrument No. 0701961, pursuant to the Customs Act 1901, applies to Koppers Arch Wood Protection (Aust) Pty Limited and the pentahydrate copper sulphates they import. This instrument is specifically designed for goods that are not produced domestically in Australia and for which there are no suitable substitutes available in the domestic market. The application of this instrument is confined to the Customs Act 1901 and extends to the entire Commonwealth of Australia, impacting any entity or individual involved in the importation of these goods. The TCO does not impose any liabilities or disadvantage any person except the Commonwealth and specifically excludes any goods listed in section 269SJ of the Act, which cannot be subject to a TCO. The implementation of this Tariff Concession Order is governed by the Customs Act 1901, with further specifics laid out in the Customs Tariff Act 1995. Any additional application or interpretation of the TCO may be detailed in subordinate instruments as necessary.
Key Provisions
The key operative sections of the Customs Act 1901, particularly section 269F, provide the framework for the application process for Tariff Concession Orders (TCOs). Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of specific goods. If the application is not for goods specified in section 269SJ, which lists goods that cannot be subject to a TCO, the CEO must determine whether the application meets the core criteria set out in section 269C. This process is further clarified by sections 269B and 269D, which define terms such as 'goods produced in Australia' and'substitutable goods'. If the CEO is satisfied that the application meets the criteria, they must issue a written order declaring the goods to which a specific item of Schedule 4 to the Customs Tariff Act 1995 applies.
The Act imposes several obligations and requirements on the parties involved. Firstly, the CEO must assess the validity of the application against the criteria outlined in sections 269C, 269B, and 269D. This includes ensuring that no substitutable goods were produced in Australia on the date the application was lodged. Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to submit reasons why the TCO should not be made. This transparency ensures that all relevant stakeholders have the opportunity to voice their concerns. Once a TCO is issued, it is considered effective from the date the application was lodged, as stipulated in section 269S(1).
There are no specific offences, penalties, or civil/criminal consequences mentioned in the Act for breaches related to the issuance of a TCO. However, the Act does outline that the rights of importers will be beneficially affected, and they can apply for a refund of duty on goods imported since the day the TCO is taken to have come into force, as per paragraph 126(1)(r) of the Regulations. This suggests that while the Act does not impose direct penalties for non-compliance, it does provide mechanisms for redress if an importer's rights are affected adversely. The Act also ensures that the rights of a person, other than the Commonwealth, are not disadvantaged by the TCO, and it does not impose any liabilities on any person in respect of anything done or omitted before the date of registration.