EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0710734
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.
Valbruna Australia Pty Ltd applied for a TCO in respect of certain stainless steel wire on 06 July 2007.
Instrument
TCO No 0710734 was made on 21 September 2007. It declares that those certain stainless steel wires 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. 0710734 is taken to have come into force on 06 July 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 amended by Tariff Concession Instrument No. 0710734 to address the need for tariff concessions on specific goods that do not have substitutable alternatives produced in Australia. Enacted by the Australian Parliament, this instrument facilitates the application of a lower rate of customs duty on certain goods, thereby providing economic benefits to importers and potentially enhancing the competitiveness of imported products. The instrument was introduced to ensure that tariff concessions are granted where appropriate, in line with the policy objective of supporting trade and industry by reducing the cost of imported goods that are essential and do not have domestic alternatives. This measure aligns with broader economic policies aimed at fostering a competitive trading environment in Australia.
Scope and Application
The Tariff Concession Instrument No. 0710734 under the Customs Act 1901 applies to individuals or entities seeking tariff concessions on specific goods, particularly in this case, certain stainless steel wires. The Act allows the Chief Executive Officer of Customs to grant tariff concessions to applicants who demonstrate that no substitutable goods are produced in Australia, thereby meeting the core criteria stipulated in the legislation. This instrument, which came into effect on 6 July 2007, allows for the application of a lower rate of customs duty on the designated goods, in this instance reducing the duty from 5% to free. The geographic reach of this Act is national, as it is a Commonwealth instrument. The Act does not apply to goods specified in section 269SJ, which lists goods ineligible for tariff concessions. The Act's application may be extended or restricted through subordinate instruments, although no such instruments are referenced in this specific context.
Key Provisions
The main operative sections of this legislation are sections 269C, 269F, 269K, and 269S. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of certain goods. If the application meets the core criteria specified in section 269C, the CEO must make a written order (a TCO) declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. Section 269K requires the CEO to publish a notice in the Gazette inviting submissions from any person who considers there are reasons why the TCO should not be made. Section 269S states that a TCO comes into force on the day on which the application for the TCO was lodged.
This Act imposes several obligations and requirements on the parties involved. The CEO must review applications for a TCO to determine if they meet the core criteria outlined in section 269C. This involves assessing whether no substitutable goods were produced in Australia on the day the application was lodged. If the CEO is satisfied that the application meets the criteria, they must make a TCO. The CEO must also publish a notice in the Gazette inviting submissions from any interested parties. If no submissions are received, the CEO can proceed to make the TCO.
There are no specific offences or penalties mentioned in this legislation for breach of the Act. However, the failure to comply with the requirements of the Act, such as not making a TCO when required or not publishing the necessary notice in the Gazette, could potentially lead to legal consequences. The CEO is required to follow the processes outlined in the Act, and failure to do so could result in legal action being taken against them for not fulfilling their duties.
The TCO itself does not impose any liabilities on any person, but it does benefit importers by allowing them to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force. This means that the TCO is designed to provide relief to importers by reducing or eliminating the customs duty on certain goods. The rights of importers will be beneficially affected, as they will be able to claim a refund for duties paid on these goods since the effective date of the TCO.