EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0802069
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.
Aquatec-Maxcon Australia Pty Ltd applied for a TCO in respect of certain degassers on 5 February 2008.
Instrument
TCO No 0802069 was made on 11 April 2008. It declares that those certain degassers 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. 0802069 is taken to have come into force on 5 February 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, provides a framework for the administration of customs duties and includes provisions for Tariff Concession Orders (TCOs). The Act was introduced to address the need for flexibility in customs duties to support economic interests and trade. Specifically, TCOs are designed to provide lower rates of customs duty on certain goods, provided that no substitutable goods are produced in Australia. The explanatory statement for Tariff Concession Instrument No. 0802069 details the application of Aquatec-Maxcon Australia Pty Ltd for a TCO concerning certain degassers, which was approved by the Chief Executive Officer of Customs (CEO) on 11 April 2008. The policy objective of this concession is to ensure that the application of the lower duty rate benefits importers without imposing any liabilities or disadvantaging existing rights.
Scope and Application
The Tariff Concession Instrument No. 0802069 under the Customs Act 1901 applies to entities and individuals who seek tariff concessions for specific goods entering Australia. The instrument is specifically concerned with the concession of customs duties on certain degassers, as applied for by Aquatec-Maxcon Australia Pty Ltd. The Act enables the Chief Executive Officer of Customs to grant these concessions if certain criteria are met, primarily focusing on whether there are substitutable goods produced in Australia. The instrument operates nationally, aligning with the overarching objectives of the Customs Act 1901, which is a Commonwealth Act. The geographic reach of this legislation is thus national, applying uniformly across all states and territories of Australia. Any exclusions or limitations are defined within the core criteria of the Act, particularly under section 269SJ, which specifies goods that cannot be subject to a tariff concession order. The Act may also extend or restrict its application through subordinate instruments, which are not elaborated in the explanatory statement but would typically involve regulations or further orders made by the CEO.
Key Provisions
The Tariff Concession Instrument No. 0802069 under the Customs Act 1901 provides for the application of a tariff concession order (TCO) to certain degassers, with a new tariff rate specified in item 50 of Schedule 4 to the Customs Tariff Act 1995 (subsection 269P(3)). The instrument was made on 11 April 2008, following an application by Aquatec-Maxcon Australia Pty Ltd on 5 February 2008. The application met the core criteria as set out in section 269C of the Customs Act, as the Chief Executive Officer (CEO) of Customs was satisfied that no substitutable goods were produced in Australia on the date the application was lodged. The CEO is required to publish a notice in the Gazette inviting submissions if any person considers there are reasons why the TCO should not be made (subsection 269K(1)). In this case, no submissions were received. The TCO is deemed to have come into force on the date the application was lodged, which is 5 February 2008 (subsection 269S(1)).
The obligations imposed by the Customs Act on parties or entities governed by this legislation include the requirement for any person to apply to the CEO for a TCO in respect of goods, ensuring the application does not pertain to goods specified in section 269SJ (subsection 269F). The CEO must then determine whether the application meets the core criteria set out in section 269C. Additionally, the CEO is obligated to publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any person who believes the TCO should not be made to lodge a submission (subsection 269K(1)). The CEO must also make a written order if satisfied that the application meets the core criteria (subsection 269P(3)).
The Customs Act imposes several consequences for breaches of its provisions. For instance, if any person contravenes a provision of the Act or the Regulations, they may be liable for penalties. While specific maximum penalties are not detailed in the explanatory statement, it is a general principle under the Customs Act that penalties may apply for non-compliance, and these can include substantial fines and, in some cases, imprisonment. Civil and criminal consequences may also arise for any person who fails to adhere to the obligations imposed by the Act or who engages in activities that breach the terms of a TCO. The exact nature and severity of these consequences would depend on the specific breach and the relevant provisions of the Customs Act and associated Regulations.