EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0719055
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.
San Marino Smallgoods applied for a TCO in respect of certain meat desalting machines on 8 November 2007.
Instrument
TCO No 0719055 was made on 29 January 2008. It declares that those certain meat desalting machines 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. 0719055 is taken to have come into force on 8 November 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. 0719055, enacted under the Customs Act 1901, addresses the problem of ensuring that tariff concessions are granted appropriately to importers for goods that do not have Australian-made equivalents. This legislative instrument was introduced to streamline the process by which the Chief Executive Officer of Customs can grant tariff concessions, thereby providing economic benefits to importers who can show that no substitutable goods are produced in Australia. The instrument was made on 29 January 2008 in response to an application by San Marino Smallgoods for a tariff concession on certain meat desalting machines, which were declared to be subject to a zero rate of duty under the Customs Tariff Act 1995. The objective of this instrument is to ensure that the tariff concessions are granted fairly and transparently, while also encouraging imports by reducing the duty on specific goods.
Scope and Application
The Tariff Concession Instrument No. 0719055 under the Customs Act 1901 applies to any entity or person seeking tariff concessions for specific goods, in this case, meat desalting machines, which were the subject of an application by San Marino Smallgoods. The instrument, made by the Chief Executive Officer of Customs, affects the duty rates on these machines by granting a concession that reduces the general rate of 5% to zero. This applies nationally across Australia and is effective from the date the application was lodged, 8 November 2007. The Act does not specify any exclusions or exemptions, but it does outline that the concession does not disadvantage any person or impose liabilities for actions taken before the registration date. The scope of the Act is limited to goods that do not have substitutable Australian-produced alternatives, as specified by the core criteria in sections 269C and 269D of the Act. Any further detailing or modifications to the application of this legislation may be addressed through subordinate instruments.
Key Provisions
The key sections of the Tariff Concession Instrument No. 0719055 under the Customs Act 1901 (the Act) include sections 269C, 269B, 269D, 269E, 269F, 269P, 269S, and 269K. Section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a Tariff Concession Order (TCO) in respect of goods. Section 269C sets out the core criteria that a TCO application must meet, which is that no substitutable goods were produced in Australia on the day the application was lodged. Sections 269B, 269D, and 269E define terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods'. If the CEO is satisfied that the application meets the core criteria, they must make a written order (a TCO) under section 269P(3). The TCO declares that the goods the subject of the application are to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies.
The Act imposes several obligations and requirements on the parties or entities it governs. Firstly, any person can apply for a TCO under section 269F. The CEO must then assess whether the application meets the core criteria outlined in section 269C. If the CEO is satisfied that the application meets these criteria, they are required to make a written TCO under section 269P(3). The CEO must also publish a notice in the Gazette inviting any person who considers there are reasons why the TCO should not be made to lodge a submission, as required by subsection 269K(1). Once a TCO is made, importers can apply for a refund of duty on goods imported since the day the TCO is taken to have come into force, under paragraph 126(1)(r) of the Regulations.
There are no specific offences, penalties, or civil/criminal consequences for breach mentioned in the legislation. However, the failure to comply with the requirements of the Act, such as not meeting the core criteria for a TCO application, could lead to the CEO refusing to make a TCO. Additionally, any person who provides false or misleading information in their TCO application could face legal consequences under other provisions of the Customs Act 1901 or related legislation. The maximum penalties for offences under the Customs Act 1901 can vary depending on the nature and severity of the offence, with some offences carrying penalties of up to $22,000 or imprisonment for up to two years, or both.