EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0705685
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.
Brisbane Airport Corporation Pty Limited applied for a TCO in respect of certain stainless steel woven mesh facade structures on 18 April 2007.
Instrument
TCO No 0705685 was made on 06 July 2007. It declares that those certain stainless steel woven mesh facade structures 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. 0705685 is taken to have come into force on 18 April 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. 0705685, enacted in 2007 under the Customs Act 1901, addresses the issue of providing tariff concessions for specific imported goods. The Act enables the Chief Executive Officer of Customs to issue Tariff Concession Orders (TCOs), which reduce the rate of customs duty on specified goods when certain criteria are met. This legislative instrument was introduced to streamline the process for reducing customs duties on goods that are not produced domestically and to ensure that Australian consumers and businesses can access competitively priced imported goods. The instrument was enacted by the Parliament of Australia and aims to support trade efficiency and economic competitiveness by facilitating lower duty rates for certain imported goods. Brisbane Airport Corporation Pty Limited’s application for a TCO for stainless steel woven mesh facade structures exemplifies the practical application of this legislation, resulting in a duty rate reduction from 5% to free, effective from the date of application.
Scope and Application
The Tariff Concession Instrument No. 0705685, made under the Customs Act 1901, applies to certain stainless steel woven mesh facade structures. This instrument was made in response to an application by Brisbane Airport Corporation Pty Limited for a Tariff Concession Order (TCO). The Act, specifically Part XVA, allows the Chief Executive Officer of Customs to create TCOs that lower the rate of customs duty on specified goods. A TCO can be applied for by any person, provided the goods in question are not those specified in section 269SJ of the Act, which lists items ineligible for TCOs. For the CEO to consider the application, it must meet the core criteria outlined in sections 269C, 269D, 269E and 269F of the Act, ensuring that the goods are not substitutable by Australian-made products. The geographic reach of this Act is national, and it applies to any person or entity seeking to import the specified goods into Australia. The TCO came into effect on 18 April 2007, the date the application was lodged, with no retroactive effect on existing rights or liabilities, thereby not disadvantaging any person other than the Commonwealth.
Key Provisions
The Customs Act 1901 provides for a scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (section 269F). An applicant may request a TCO for goods, and if the CEO is satisfied that the application is valid and meets the core criteria, they must make a written order declaring that the specified goods are subject to a prescribed rate of duty (section 269P(3)). In this case, TCO No. 0705685 was made on 6 July 2007 for certain stainless steel woven mesh facade structures, applying the zero duty rate from the date of application, 18 April 2007 (subsection 269S(1)).
The core criteria for a TCO application are outlined in section 269C. An application is deemed to meet these criteria if, on the day it was lodged, no substitutable goods were produced in Australia in the ordinary course of business. The definitions of key terms, such as 'substitutable goods', 'goods produced in Australia', and 'ordinary course of business', are given in sections 269D, 269E, and 269F of the Act respectively. For the TCO in question, the CEO was satisfied that no substitutable goods were produced in Australia, thus satisfying the core criteria.
The CEO must also 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)). In this instance, the CEO did not receive any submissions in response to the published notice. The TCO does not affect the rights of any person, other than the Commonwealth, as at the date of registration in a way that disadvantages them or imposes liabilities for actions taken before the registration date (subsection 269S(2)). Importers will benefit from this TCO as they can apply for a refund of duty on goods imported since the TCO is taken to have come into force (paragraph 126(1)(r) of the Regulations).
There are no explicit offences, penalties, or consequences for breach outlined in the Act with respect to TCOs. However, any breach of the Customs Act 1901 or the associated regulations could result in criminal or civil penalties. For instance, knowingly making a false statement or providing misleading information in relation to customs matters could attract penalties of up to 10,000 penalty units or imprisonment for up to five years, or both, under section 236A of the Customs Act. Similarly, failure to comply with the requirements of the Customs Act or the associated regulations could lead to financial penalties and legal actions under other relevant provisions of the Act.