EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0712509
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.
Inghams Enterprises Pty Ltd applied for a TCO in respect of certain poultry meat presses on 3 August 2007.
Instrument
TCO No 0712509 was made on 12 October 2007. It declares that those certain poultry meat presses 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 0%.
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. 0712509 is taken to have come into force on 3 August 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 to establish a comprehensive framework for customs administration, and it includes provisions for Tariff Concession Orders (TCOs) under Part XVA. This particular legislative instrument, Tariff Concession Instrument No. 0712509, was introduced to address the specific need of Inghams Enterprises Pty Ltd to obtain tariff concessions for certain poultry meat presses. Enacted by the Commonwealth Parliament, the policy objective is to facilitate the import of goods by reducing the customs duty rate for specified items, provided that no substitutable goods are produced in Australia, thereby encouraging trade and supporting Australian businesses. This instrument ensures that the tariff concession is effective from the date the application was lodged, thereby providing immediate benefit to importers of the specified goods.
Scope and Application
The Customs Act 1901, through its Part XVA, allows for Tariff Concession Orders (TCO) to be issued by the Chief Executive Officer of Customs (CEO) to provide lower rates of customs duty on specified goods. This legislation applies to any person or entity seeking to import goods into Australia that are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. The process begins when an application is made to the CEO, who then determines if the application meets the core criteria set out in section 269C, specifically if no substitutable goods are produced in Australia at the time of application. This determination hinges on the definitions provided in sections 269D and 269E of the Act. If the application is approved, the CEO issues a written order, which is effective from the date the application was lodged. For example, Inghams Enterprises Pty Ltd successfully applied for a TCO on certain poultry meat presses, resulting in a tariff concession reducing the duty rate from 5% to 0%. The CEO is also required to publish a notice in the Gazette inviting any interested parties to submit objections to the TCO, though no such submissions were received in this case. This instrument thus benefits importers by potentially allowing them to apply for a refund of duty on the specified goods since the TCO's effective date, without imposing any new liabilities.
Key Provisions
The key operative sections of this legislation are sections 269C, 269P, and 269S, which detail the conditions under which a Tariff Concession Order (TCO) can be made and the effect of such an order. Section 269C outlines the core criteria that must be met for a TCO application to be considered, specifically that no substitutable goods are produced in Australia in the ordinary course of business on the day the application is lodged. Section 269P(3) mandates that if these criteria are met, the Chief Executive Officer (CEO) of Customs must issue a TCO, specifying that the goods in question are subject to a prescribed rate of duty. Section 269S(1) determines that the TCO comes into effect on the date the application is lodged, thereby granting immediate tariff concessions to the goods specified.
The obligations imposed by this legislation primarily rest on the CEO of Customs, who must assess TCO applications against the criteria set out in section 269C. The CEO is also required to publish a notice in the Gazette inviting submissions from any person who might oppose the making of the TCO, as outlined in section 269K(1). Additionally, any person applying for a TCO must ensure their application meets the specified criteria, particularly that no substitutable goods are produced in Australia. The CEO’s decision-making process must be transparent and inclusive, providing an opportunity for public input before issuing the TCO.
Failure to comply with the requirements set forth in this legislation may lead to various consequences. While specific offences and penalties are not detailed in the Explanatory Statement, the general legal framework under which the Customs Act operates could impose sanctions. Non-compliance by the CEO in following the statutory requirements for issuing a TCO could potentially result in legal challenges or administrative penalties. Conversely, an applicant who submits a false TCO application may face legal repercussions under the general law concerning false statements or misrepresentations in administrative processes. The severity of penalties would depend on the specific nature of the breach and applicable laws at the time.