EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0706227
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.
Reinforced Earth Pty Ltd applied for a TCO in respect of certain soil reinforcement strip on 30 April 2007.
Instrument
TCO No 0706227 was made on 20 July 2007. It declares that the certain soil reinforcement strip is a good 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. 0706227 is taken to have come into force on 30 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 Customs Act 1901, enacted by the Australian Parliament, addresses the need for a flexible framework to grant tariff concessions on imported goods. This framework allows for the reduction or elimination of customs duties on specific goods through Tariff Concession Orders (TCOs) issued by the Chief Executive Officer of Customs. The primary aim of this legislation is to ensure that Australian industries remain competitive by potentially lowering the cost of imported goods that do not have domestic alternatives. In the case of Tariff Concession Instrument No. 0706227, enacted on 20 July 2007, the focus was on granting a tariff concession to Reinforced Earth Pty Ltd for certain soil reinforcement strips, reflecting the policy objective of supporting specific sectors by reducing their input costs through duty-free importation of these goods.
Scope and Application
The Tariff Concession Instrument No. 0706227 is part of the Customs Act 1901, specifically under the provisions that allow the Chief Executive Officer of Customs to issue Tariff Concession Orders (TCO). This Act applies to individuals and entities that seek to have customs duty concessions on specific goods by applying for a TCO. The legislation is designed to benefit importers of goods that, once a TCO is issued, are eligible for a reduced rate of customs duty or even duty-free status, provided the goods are not produced in Australia and no substitutable goods are made domestically. The geographic reach of this Act is national, as it pertains to the importation of goods into Australia. However, it excludes goods specified in section 269SJ of the Act, which are those that cannot be subject to a TCO. The application process involves the CEO reviewing the core criteria set out in sections 269C, 269B, and 269D of the Act to determine the eligibility for a concession. The Act does not disadvantage any person other than the Commonwealth, nor does it impose liabilities on any person, as clarified under subsection 269S(1) of the Act. The TCO, once issued, applies from the date the application was lodged, as per the Act’s provisions on commencement.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0706227 under the Customs Act 1901 (section 269F) detail the process for applying for a Tariff Concession Order (TCO). An application for a TCO can be made by a person to the Chief Executive Officer (CEO) of Customs, who will then assess whether the application meets the core criteria (section 269C). If the CEO determines that no substitutable goods were produced in Australia on the day the application was lodged (section 269D), they are required to issue a TCO (section 269P(3)). This instrument, TCO No. 0706227, applies to certain soil reinforcement strips and declares that these goods are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, effectively setting the duty rate at free instead of the general rate of 5%.
The Act imposes certain obligations and requirements on the parties involved. Firstly, any person wishing to apply for a TCO must ensure their application is made in accordance with the stipulated criteria (section 269F). The CEO must then assess the application against these criteria, specifically checking if no substitutable goods were produced in Australia at the time of application (section 269C). The CEO must also publish a notice in the Gazette inviting any person to lodge a submission if they believe the TCO should not be made (section 269K(1)). Additionally, once a TCO is issued, it must be registered and will come into force on the day the application was lodged (section 269S(1)).
Failing to comply with the requirements of the Customs Act 1901 and the associated TCO can lead to civil or criminal consequences. However, the explanatory statement does not specify any particular offences or penalties directly related to breaches of TCO provisions. It is, however, implied that any non-compliance with the Act's provisions could lead to standard penalties as outlined in the broader Customs Act, which may include fines or other penalties as determined by the courts.
In summary, TCO No. 0706227 under the Customs Act 1901 allows for tariff concessions on certain soil reinforcement strips, provided the CEO is satisfied with the application criteria. The CEO is mandated to assess applications, publish notices for public submissions, and issue TCOs where appropriate. Although specific penalties for breaches are not detailed, non-compliance with the Act could result in standard penalties as per the broader legislative framework.