EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0702573
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.
Alcan Gove Development Pty Limited applied for a TCO in respect of certain alumina plant digestion facility bases on 19 February 2007.
Instrument
TCO No 0702573 was made on 11 May 2007. It declares that those certain alumina plant digestion facility bases 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. 0702573 is taken to have come into force on 19 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 was enacted by the Commonwealth Parliament to provide a framework for the administration of customs and excise duties. It addresses the need for a streamlined process to grant tariff concessions on certain imported goods, ensuring that businesses can access necessary goods at a reduced duty rate under specific conditions. This legislation was introduced to facilitate economic efficiency by allowing the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that apply lower rates of customs duty on specified goods, provided that no substitutable goods are produced in Australia. The policy objective is to support industries by reducing the cost of imported goods that are crucial for production but not locally manufactured, thereby encouraging economic growth and competitiveness.
The Tariff Concession Instrument No. 0702573, made under the Customs Act 1901, exemplifies this legislative intent. It grants a TCO to Alcan Gove Development Pty Limited for certain alumina plant digestion facility bases, effective from 19 February 2007. This instrument was introduced to provide tariff relief on these specific goods, which are essential for industrial operations, thereby reducing the financial burden on businesses that rely on importing these items. The absence of submissions against the TCO indicates a consensus on the necessity and appropriateness of the tariff concession.
Scope and Application
The Customs Act 1901, specifically under Part XVA, enables the Chief Executive Officer of Customs to issue Tariff Concession Orders (TCOs) which apply lower rates of customs duty to certain goods. These orders are applicable to the goods specified in the order and can be applied for by any person, provided that the goods in question are not listed in section 269SJ of the Act, which includes goods that are excluded from tariff concessions. The TCOs are effective from the date of the application and have a national jurisdictional reach, impacting all importers of the specified goods. There are no reported submissions against the application for this particular TCO, indicating a lack of opposition to the tariff concession. The instrument, TCO No. 0702573, was made on 11 May 2007, concerning alumina plant digestion facility bases, and was effective from 19 February 2007, the date the application was lodged. It declares that these goods are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, with the general duty rate of 5% reduced to free for the specified goods. The TCO does not alter existing rights or impose any new liabilities on individuals or entities other than the Commonwealth, and it benefits importers by allowing them to apply for duty refunds on goods imported since the effective date of the TCO.
Key Provisions
The Customs Act 1901 (section 269F) provides the framework for the application process for Tariff Concession Orders (TCOs), which allows for a reduced rate of customs duty on specified goods. A person can apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods, provided the goods are not specified in section 269SJ as ineligible. The CEO must then determine if the application meets the core criteria, as defined by section 269C, which requires that on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business (section 269C, 269D, and 269E). If satisfied, the CEO is required to make a written order declaring that the goods are subject to a prescribed item in Schedule 4 of the Customs Tariff Act 1995.
The obligations imposed by the Act on the parties or entities it governs include the requirement for applicants to ensure that their application meets the core criteria, specifically that no substitutable goods were produced in Australia at the time of application. The CEO must publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made (subsection 269K(1)). The CEO is also responsible for making the decision on the application and issuing the TCO if the criteria are met. The CEO in this case did not receive any submissions in response to the published notice.
The Act does not explicitly outline specific offences, penalties, or civil/criminal consequences for breaches related to TCOs. However, the general obligations to comply with the provisions of the Customs Act and its regulations apply, and failure to comply could result in enforcement actions under the broader customs and excise framework. These actions could include fines, penalties, or other legal consequences as prescribed by the relevant sections of the Act and any related regulations. The precise penalties would depend on the specific nature and severity of the breach.