EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0719098
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.
Ri-Co Oneweld Pty Ltd applied for a TCO in respect of certain pipe lining machines on 9 November 2007.
Instrument
TCO No 0719098 was made on 13 February 2008. It declares that those certain pipe lining 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. 0719098 is taken to have come into force on 9 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 peron 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, enacted by the Parliament of Australia, establishes a framework for the administration of customs duties and includes provisions for Tariff Concession Orders (TCOs). These orders, which can be applied for by individuals or entities, allow for a lower rate of customs duty on specified goods. The primary gap addressed by this legislation is the need for a streamlined process to reduce customs duties on goods where suitable domestic alternatives do not exist. This facilitates trade by lowering the cost of imported goods, thereby encouraging their use and integration into the Australian market. The explanatory statement accompanying Instrument No. 0719098, made under this Act, outlines a specific case where a TCO was granted for certain pipe lining machines, reducing the duty from 5% to free. The decision to grant the TCO was based on the absence of substitutable goods produced in Australia, as required by the Act. The process ensures transparency and opportunity for public input, though in this instance, no submissions were received against the TCO. The TCO, effective from the date of application, does not impose any liabilities or adversely affect the rights of persons other than the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0719098 applies to specific pipe lining machines as identified by the applicant, Ri-Co Oneweld Pty Ltd. This Act operates under the Customs Act 1901 and provides for tariff concessions on goods that are not substitutable with goods produced in Australia. The concession applies to those goods specified in the instrument, allowing for a reduction in the customs duty rate from the general 5% to a free rate. The scope of the Act extends to any person or entity seeking to import the specified goods into Australia, thereby benefiting importers by potentially reducing their duty costs. The instrument has a national reach, governed by the Commonwealth, and its application does not extend to any goods specified in section 269SJ of the Act, which are ineligible for tariff concessions. The instrument came into effect on 9 November 2007, the date the application was lodged, and does not retroactively affect any transactions or rights held by parties prior to this date. The instrument may be further refined or extended through subordinate instruments as needed to align with the overarching Customs Act 1901 and related regulations.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 0719098 under the Customs Act 1901 (section 269C and 269P(3)) provide that the Chief Executive Officer of Customs (CEO) must decide whether a Tariff Concession Order (TCO) application meets the core criteria, which include whether no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. If the CEO is satisfied that the application meets these criteria, they must make a written order (a TCO) declaring that the goods are to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies. In this instance, the CEO made TCO No. 0719098 on 13 February 2008, declaring that certain pipe lining machines are goods to which item 50 of Schedule 4 to the Tariff applies, reducing the general rate of duty from 5% to free.
The Act imposes several obligations on the parties involved. The CEO has the responsibility to assess whether an application for a TCO meets the core criteria and to make a written order if satisfied. The applicant, in this case Ri-Co Oneweld Pty Ltd, must ensure their application is in accordance with the Act and provides all necessary information to satisfy the CEO. Furthermore, the CEO must publish a notice in the Gazette inviting any interested parties to submit reasons why the TCO should not be made, as per subsection 269K(1). This ensures transparency and allows for any objections to be considered before the TCO is made. In this case, no submissions were received by the CEO.
Failure to comply with the requirements of the Customs Act 1901 may lead to various consequences. While the explanatory statement does not explicitly mention any offences or penalties, breaches of the Act could result in civil or criminal consequences depending on the nature and severity of the breach. The maximum penalties for offences under the Customs Act 1901 can include fines and imprisonment, but these specifics would need to be referred to within the broader context of the Act. The TCO itself does not impose any liabilities on any person, and it does not affect the rights of a person as at the date of registration in a way that disadvantages them or imposes liabilities in respect of anything done or omitted before the registration date.