EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0719757
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.
Water Corporation applied for a TCO in respect of certain wastewater treatment and odour control plant on 20 November 2007.
Instrument
TCO No 0719757 was made on 1 February 2008. It declares that those certain wastewater treatment and odour plant 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. 0719757 is taken to have come into force on 20 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. 0719757 was enacted in 2008 to address the need for tariff concessions on specific goods, as provided for in the Customs Act 1901. The Act was enacted by the Parliament of Australia, aiming to facilitate trade by allowing lower rates of customs duty on goods that meet certain criteria and are not produced in Australia in the ordinary course of business. In this instance, the instrument was made in response to an application from Water Corporation for tariff concessions on wastewater treatment and odour control plant, resulting in a reduction of the duty rate from 5% to free. The instrument was published in the Gazette, inviting submissions from interested parties, though none were received. The concessions came into effect on the date the application was lodged, benefiting importers by allowing them to apply for refunds of duty on goods imported since that date, without imposing any new liabilities on any person.
Scope and Application
The Customs Act 1901, through Part XVA, establishes a scheme under which Tariff Concession Orders (TCOs) may be made by the Chief Executive Officer of Customs (CEO). This Act applies to individuals and entities seeking to import goods that may be subject to reduced customs duty rates through a TCO. The legislation covers goods that are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. A TCO application is considered if, on the day it is lodged, no substitutable goods were produced in Australia in the ordinary course of business, as per section 269C. The CEO's decision to issue a TCO is contingent on satisfying the core criteria outlined in the Act. This particular instrument, TCO No. 0719757, applies to certain wastewater treatment and odour control plant, declaring them as goods to which a specific item in the Customs Tariff applies, thus granting them a duty-free status. The application of this TCO is national in scope and does not affect the rights of any person as of the date of registration, nor does it impose liabilities on any person.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0719757, under the Customs Act 1901, relate to the creation of a Tariff Concession Order (TCO) for specific wastewater treatment and odour control plant (section 269F). Section 269C specifies that a TCO application meets the core criteria if, at the time of application, no substitutable goods are produced in Australia. In this case, the Chief Executive Officer of Customs (CEO) found that no such goods were produced in Australia, thus satisfying the core criteria. Section 269P(3) mandates that if the CEO is satisfied with the application, a written TCO must be issued. In this instance, the TCO was issued on 1 February 2008, declaring that the wastewater treatment and odour control plant are subject to item 50 of Schedule 4 of the Customs Tariff Act 1995, resulting in a duty rate of free rather than the general rate of 5%.
The Act imposes several obligations on parties or entities it governs. Firstly, any entity seeking a TCO must submit an application to the CEO, ensuring that the goods in question do not fall under the exclusions listed in section 269SJ. Once an application is deemed valid, the CEO must publish a notice in the Gazette inviting submissions from any interested parties who might have objections to the TCO. In this case, no submissions were received, allowing the TCO to proceed without opposition. Additionally, the CEO must ensure that the TCO does not disadvantage any person (other than the Commonwealth) in terms of rights or impose liabilities for actions taken prior to the registration of the TCO.
The Act includes provisions for penalties and consequences in the event of a breach. However, the explanatory statement does not detail specific offences or penalties related to the TCO. It does clarify that the TCO does not affect the rights of any person, except the Commonwealth, as at the date of registration and does not impose any liabilities on any person. For detailed information on penalties, one would need to refer to other sections of the Customs Act 1901 or related legislation.