EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0717568
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.
Elgas Ltd applied for a TCO in respect of certain lp gas hoses on 16 October 2007.
Instrument
TCO No 0717568 was made on 04 January 2008. It declares that those certain lp gas hoses 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. 0717568 is taken to have come into force on 16 October 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 provide a framework for the regulation of customs and excise, including the imposition of customs duty on imported goods. The introduction of Tariff Concession Orders (TCOs) under Part XVA of the Act addresses the gap in providing tariff relief for specific goods where no substitutable goods are produced in Australia. The enacting body for the Customs Act 1901 is the Australian Parliament. The policy objective of this particular TCO, as stated in the explanatory statement, is to provide tariff relief by allowing free import of certain lp gas hoses, thereby benefiting importers who can apply for a refund of duty on these goods imported since the TCO came into effect on 16 October 2007. The Chief Executive Officer of Customs (CEO) made TCO No. 0717568 on 4 January 2008, following Elgas Ltd’s application on 16 October 2007, after being satisfied that the application met the core criteria and no substitutable goods were produced in Australia. The TCO ensures that no existing rights or liabilities are adversely affected by its implementation.
Scope and Application
The Tariff Concession Instrument No. 0717568 under the Customs Act 1901 applies to persons or entities seeking tariff concessions on specific goods imported into Australia. This instrument specifically governs the process for applying for and obtaining a Tariff Concession Order (TCO) from the Chief Executive Officer of Customs (the CEO). The Act applies to any person or entity that wishes to apply for a TCO in respect of goods that are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. The scope of the TCO extends to reducing or eliminating customs duties on goods for which no substitutable goods are produced in Australia, thereby benefiting the applicant's import costs. The geographic reach of this legislation is national, as it pertains to customs duties across Australia. The Act does not impose any liabilities on any person and does not affect the rights of a person, other than the Commonwealth, as at the date of registration. The CEO must decide whether the TCO application meets the core criteria, which include ensuring that no substitutable goods were produced in Australia on the day the application was lodged. The TCO comes into force on the day the application for the TCO was lodged, and no submissions were received in response to the invitation for objections.
Key Provisions
The main operative sections of the Customs Act 1901 (the Act) that are relevant to this Tariff Concession Order (TCO) include sections 269C, 269F, 269K, and 269S. Section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a TCO in respect of goods. If the CEO is satisfied that the application meets the core criteria, as defined in section 269C, the CEO must make a written order (a TCO) (section 269P). The core criteria require that, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business (section 269C). A TCO declares that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, with a reduced rate of duty, in this case, free of duty (section 269P(3)).
The Act imposes specific obligations on the CEO in relation to TCO applications. Upon receiving a valid application, the CEO must publish a notice in the Gazette inviting any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO (subsection 269K(1)). The CEO must then decide whether the application meets the core criteria (section 269C). If the CEO is satisfied that the application meets these criteria, a TCO must be made (section 269P). Furthermore, the CEO must ensure that 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 (subsection 269S(1)).
There are no specific offences, penalties, or civil or criminal consequences outlined for breaching the provisions of this TCO. However, if any person feels aggrieved by the making of a TCO, they would need to seek redress under the general administrative law principles or any other relevant statutory provisions. The primary focus of the TCO is to facilitate the importation of certain lp gas hoses with a reduced rate of duty, thus benefiting importers who have imported these goods since the date the TCO is taken to have come into force. The TCO does not impose any new liabilities or disadvantages on any person other than the Commonwealth.