EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0801349
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.
Austral Wright Metals applied for a TCO in respect of certain aluminium annealed strips on 22 January 2008.
Instrument
TCO No 0801349 was made on 18 April 2008. It declares that those certain aluminium annealed strips 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. 0801349 is taken to have come into force on 22 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 Customs Act 1901, enacted by the Parliament of Australia, established a framework for administering customs duties and includes provisions for Tariff Concession Orders (TCOs). The Act, as supplemented by the Customs Tariff Act 1995, allows the Chief Executive Officer of Customs to grant tariff concessions to applicants who demonstrate that the goods in question are not produced in Australia and that there are no suitable substitute goods available domestically. This mechanism aims to support Australian industries by providing relief from customs duties on certain imported goods, thus promoting fair competition and economic growth. The Explanatory Statement for Tariff Concession Instrument No. 0801349 clarifies that the instrument was introduced to provide a tariff concession for certain aluminium annealed strips, reducing the duty from the general rate of 5% to free, effective from the date of the application, 22 January 2008. The instrument was published in the Gazette with no submissions received against it, and it does not affect any existing rights or impose liabilities on persons other than the Commonwealth.
Scope and Application
The Customs Act 1901, under Part XVA, establishes a framework whereby Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs, providing for reduced customs duty rates on specified goods. This Act applies to individuals and entities that wish to import goods that may qualify for a TCO, particularly where such goods are not produced in Australia and do not have substitutable alternatives available domestically. The geographical reach of this legislation is national, as it applies to all imports into Australia. The Act explicitly excludes certain goods from being subject to a TCO, as defined in section 269SJ. The TCO process involves an application by an interested party, review by the CEO, and potential publication of the application in the Gazette to allow for public submissions, although these are not always necessary. Once a TCO is registered, it applies retroactively to the date the application was lodged, offering relief to importers who may apply for duty refunds from that date. The Act does not impose any liabilities on persons other than the Commonwealth and does not disadvantage any such persons in relation to actions taken before the TCO's registration.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 0801349 include sections 269C, 269F, and 269P of the Customs Act 1901. Section 269F allows an individual or entity to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO). If the application meets the core criteria set out in section 269C, the CEO is required to make a written order, declaring the goods in question as eligible for tariff concessions. Section 269P(3) further specifies that if the CEO is satisfied the application meets the core criteria, the CEO must issue the TCO, specifying the applicable tariff item under the Customs Tariff Act 1995.
The Act imposes several obligations and requirements on the parties involved. Firstly, any person seeking a tariff concession must apply to the CEO in accordance with section 269F. This application must be made in good faith and supported by relevant evidence that no substitutable goods are being produced in Australia. The CEO has the responsibility to review the application, determine if it meets the core criteria as defined in section 269C, and make a written order if satisfied. Additionally, the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application, inviting any interested party to submit objections or concerns regarding the application. This process ensures transparency and allows for any potential objections to be considered before the TCO is issued.
The Customs Act 1901 also delineates various consequences for non-compliance with the provisions of the Act and any TCOs issued under it. While specific offences and penalties related to the failure to comply with a TCO are not detailed in the explanatory statement, general provisions of the Customs Act may apply. Non-compliance with customs regulations can result in civil or criminal penalties, including fines and imprisonment. The severity of the penalty depends on the nature and extent of the breach, with maximum penalties specified under relevant sections of the Act. It is also important to note that the TCO itself does not impose any new liabilities on any person other than the Commonwealth and does not adversely affect the rights of individuals or entities as at the date of registration.