EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0712554
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.
Barrett Burston Malting Co Pty Ltd applied for a TCO in respect of certain steel barley malt germinating and kilning tanks on 06 August 2007.
Instrument
TCO No 0712554 was made on 12 October 2007. It declares that those certain steel barley malt germinating and kilning tanks 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. 0712554 is taken to have come into force on 06 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 Tariff Concession Instrument No. 0712554 was enacted under the Customs Act 1901 with the aim of addressing the issue of tariff concessions for specific goods that are not produced in Australia. The instrument was introduced to facilitate the reduction of customs duty for certain imported goods, ensuring that businesses can access necessary materials without incurring excessive tariffs when no locally produced alternatives exist. This was achieved by allowing the Chief Executive Officer of Customs to make a Tariff Concession Order (TCO) when satisfied that no substitutable goods are produced in Australia. The policy objective behind this measure is to support Australian industries by potentially lowering costs and improving competitiveness, while also ensuring that the rights of importers are protected.
The Tariff Concession Instrument No. 0712554, which came into force on 6 August 2007, was introduced by the Parliament of Australia through the Customs Act 1901. This legislation allows for the application of lower customs duty rates on specific imported goods when no domestically produced alternatives exist. The instrument was made following an application by Barrett Burston Malting Co Pty Ltd for a concession on certain steel barley malt germinating and kilning tanks. The instrument was finalised on 12 October 2007 and resulted in the exemption of these goods from the general 5% duty rate, effectively setting the duty rate to free. This legislative action supports the broader economic policy of promoting fair trade and economic efficiency by reducing unnecessary tariffs.
Scope and Application
The Tariff Concession Instrument No. 0712554 under the Customs Act 1901 applies to the specific case of certain steel barley malt germinating and kilning tanks, addressing the application made by Barrett Burston Malting Co Pty Ltd on 6 August 2007. This instrument is designed to provide a tariff concession for goods that meet certain criteria, namely that no substitutable goods are produced in Australia in the ordinary course of business. This application was accepted by the Chief Executive Officer of Customs (CEO) who was satisfied that the goods in question did not have a domestic alternative. The instrument applies to the goods specified in the application and is in effect as of the date the application was lodged, as per the provisions of the Customs Act 1901. The instrument does not extend to goods specified in section 269SJ of the Act, which are ineligible for tariff concessions. The CEO's decision to grant the concession was made without any submissions opposing the application, as no objections were raised following the published notice in the Gazette. The application of this TCO does not affect any existing rights or liabilities of persons other than the Commonwealth, and it potentially benefits importers by allowing them to seek refunds for duties paid on these goods since the effective date of the concession.
Key Provisions
The Tariff Concession Instrument No. 0712554, made under section 269P of the Customs Act 1901 (the Act), pertains to the establishment of a Tariff Concession Order (TCO) for certain steel barley malt germinating and kilning tanks. Under section 269F, Barrett Burston Malting Co Pty Ltd applied for the concession on 6 August 2007, and the Chief Executive Officer of Customs (the CEO) issued the TCO on 12 October 2007. The TCO declares that the specified tanks are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995 (the Tariff), with the rate of duty reduced to free from the general rate of 5%.
The Act imposes specific obligations on the CEO when handling TCO applications. Upon receiving an application, the CEO must first ensure that it does not pertain to goods listed in section 269SJ, which cannot be subject to a TCO. If the application is valid, the CEO must then assess whether it meets the core criteria outlined in section 269C, which requires that, on the application date, no substitutable goods were produced in Australia in the ordinary course of business. Definitions for terms such as "substitutable goods," "ordinary course of business," and "goods produced in Australia" are provided in sections 269B, 269D, and 269E of the Act. If these criteria are met, the CEO is mandated to issue a written order (a TCO) as specified in section 269P(3). Additionally, as per subsection 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any interested parties, although no submissions were received in this case.
The Act does not explicitly outline specific offences, penalties, or civil/criminal consequences for breaches related to the issuance or application of a TCO. However, the overarching legal framework provided by the Customs Act 1901 and the Customs Tariff Act 1995 would apply in the event of non-compliance with customs regulations. The TCO itself does not impose any new liabilities on individuals or entities, and it does not affect the rights of persons other than the Commonwealth as at the date of registration. Importers, however, may benefit from the TCO by applying for a refund of duty on goods imported since the TCO's effective date under paragraph 126(1)(r) of the Regulations.