EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0713980
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.
Citywide Service Solutions Pty Ltd applied for a TCO in respect of certain asphalt production plant on 03 September 2007.
Instrument
TCO No 0713980 was made on 16 November 2007. It declares that those certain asphalt production plants 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. 0713980 is taken to have come into force on 03 September 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 by the Australian Parliament to establish a framework for the regulation of customs and excise duties, ensuring the collection of duties and taxes on imported goods. The Act, particularly Part XVA, introduces a scheme whereby Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (CEO) to apply lower rates of customs duty to specified goods. This legislative provision was introduced to address the issue of ensuring that Australian industries can compete fairly and access necessary imported goods at reduced duty rates where no suitable Australian-made alternatives exist. In this context, Tariff Concession Instrument No. 0713980 was introduced to provide tariff concessions for certain asphalt production plant, acknowledging that no substitutable goods were produced in Australia at the time of the application. The policy objective is to support industry by making essential imported goods more affordable and accessible.
Scope and Application
The Tariff Concession Instrument No. 0713980, made under Part XVA of the Customs Act 1901, applies to the specific goods in question, namely certain asphalt production plants, and those entities or individuals who import these goods into Australia. The Act enables the Chief Executive Officer of Customs to grant a Tariff Concession Order (TCO) which lowers the rate of customs duty on these goods. The instrument applies nationally, as the Customs Act 1901 is a Commonwealth Act, thereby having jurisdiction throughout Australia. The TCO does not apply to goods specified in section 269SJ of the Act, which are ineligible for tariff concessions. Furthermore, the TCO was made on the basis that no substitutable goods were produced in Australia on the date the application was lodged, as per the criteria outlined in section 269C of the Act. The TCO does not extend or restrict application through subordinate instruments, as the specific application of the TCO is confined to the particular goods in question.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0713980 under the Customs Act 1901 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 outlined in section 269C, the CEO must make a written order declaring the goods to which the order applies (s 269P(3)). Section 269K requires the CEO to publish a notice in the Gazette inviting submissions on the application, while section 269S stipulates that a TCO comes into force on the day the application is lodged.
Under this Act, the CEO has the obligation to assess whether a TCO application meets the core criteria. This involves verifying that no substitutable goods were produced in Australia on the day the application was lodged (s 269C). If the application is deemed valid, the CEO must make a TCO as specified (s 269P(3)). The CEO is also required to publish a notice in the Gazette soliciting submissions from any interested parties (s 269K). If no submissions are received, the CEO proceeds to issue the TCO, which will come into effect on the date the application was lodged (s 269S).
Breach of the conditions outlined in this legislation may result in civil or criminal penalties. While the specific penalties are not detailed in the explanatory statement, under the Customs Act 1901, general penalties for non-compliance with customs regulations can include fines and, in severe cases, imprisonment. The maximum penalties would be determined based on the specific breach and relevant sections of the Act. Additionally, any failure to comply with the terms of a TCO could result in the goods being subject to the standard customs duty rates, negating any tariff concession benefits.