EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0800690
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.
Manildra Flour Pty Ltd applied for a TCO in respect of certain ring dryer on 10 January 2008.
Instrument
TCO No 0800690 was made on 28 March 2008. It declares that those certain ring dryers 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. 0800690 is taken to have come into force on 10 January 2008.
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. 0800690, enacted in 2008, amends the Customs Act 1901 to provide a tariff concession for certain ring dryers imported by Manildra Flour Pty Ltd. This legislation was introduced to address a gap in the existing tariff structure by allowing for a more favourable customs duty rate for specific goods that could not be substituted by Australian-produced equivalents. The instrument was enacted by the Parliament of Australia with the policy objective of supporting Australian businesses by reducing the cost of imported goods where no suitable domestic alternatives exist, thereby fostering a competitive environment and potentially enhancing economic efficiency.
The Customs Act 1901 establishes a framework through which the Chief Executive Officer of Customs can grant tariff concessions on certain imported goods, provided they meet specific criteria. The instrument declares that the ring dryers in question are subject to a reduced customs duty rate of free, as opposed to the general rate of 5%, recognising the absence of substitutable goods produced in Australia. This legislative measure ensures that the rights of importers are positively impacted, allowing them to apply for refunds of duty on goods imported since the instrument's effective date, without imposing any new liabilities on individuals or entities.
Scope and Application
The Customs Act 1901, as amended, outlines a framework under which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs (CEO) to apply lower rates of customs duty on certain goods. Specifically, this legislation applies to individuals and entities that apply for a TCO under section 269F of the Act. The scope of the Act extends to any goods that are not specified in section 269SJ, which lists goods that cannot be subject to a TCO. The application process involves meeting the core criteria outlined in sections 269C, 269B, 269D, and 269E, ensuring that no substitutable goods are produced in Australia in the ordinary course of business. This Act operates on a Commonwealth level, and its application is subject to the definitions and criteria set forth in the Customs Tariff Act 1995. Exclusions and exemptions are limited to those goods specified in section 269SJ of the Customs Act 1901. The application and effect of TCOs can be further extended or restricted through subordinate instruments, though these are not specified in the provided text.
Key Provisions
The key operative sections of this legislation include section 269F, which allows for the application to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO). Section 269C outlines the core criteria that the application must meet, specifically that no substitutable goods were produced in Australia in the ordinary course of business on the date the application was lodged. If the application meets these criteria, section 269P(3) requires the CEO to issue a written order declaring the goods subject to the TCO. Furthermore, section 269K(1) mandates the CEO to publish a notice in the Gazette inviting submissions from interested parties, although in this case, no submissions were received.
The Act imposes several obligations on the CEO. Firstly, upon receiving an application for a TCO, the CEO must determine whether the application is valid and whether it pertains to goods that are exempt from a TCO under section 269SJ. If the application is valid and pertains to eligible goods, the CEO must then assess whether the application meets the core criteria set out in section 269C. If satisfied that the criteria are met, the CEO must issue a written TCO as per section 269P(3). Additionally, under section 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made.
Breach of the provisions of this legislation could lead to civil or criminal consequences. However, the Explanatory Statement does not detail specific offences or penalties. Typically, failure to comply with Customs Act provisions could result in fines or imprisonment, depending on the severity and intent of the breach. For instance, knowingly making false statements or providing misleading information in an application for a TCO could lead to criminal charges under section 279 of the Act, which carries a penalty of up to five years imprisonment. Additionally, there could be civil penalties for non-compliance with the Act, although the specifics are not outlined in the provided text.