EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0802703
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.
Procast Australia Pty Ltd applied for a TCO in respect of certain concrete mixing plant on 15 February 2008.
Instrument
TCO No 0802703 was made on 18 April 2008. It declares that those certain concrete mixing plants 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. 0802703 is taken to have come into force on 15 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 Tariff Concession Instrument No. 0802703, enacted in 2008, was introduced to provide tariff concessions on certain goods under the Customs Act 1901. This instrument aims to facilitate trade by reducing the customs duty on specified goods, in this case, certain concrete mixing plants, to zero. The instrument was enacted by the Chief Executive Officer of Customs in accordance with section 269F of the Customs Act 1901, which allows for the application of Tariff Concession Orders (TCO) when specific criteria are met. The policy objective behind this concession is to support the importation of goods that are not being produced domestically, thereby promoting competition and potentially lowering costs for businesses reliant on these imports. The instrument came into effect on 15 February 2008, the date on which the application for the tariff concession was lodged, and does not affect any pre-existing rights or liabilities of individuals or entities other than the Commonwealth.
Scope and Application
The Tariff Concession Order No. 0802703 under the Customs Act 1901 applies to specific concrete mixing plants and is intended to benefit Procast Australia Pty Ltd by providing a concession on customs duty for these goods. The order applies to the Commonwealth of Australia, meaning it is governed by federal law. The order was made by the Chief Executive Officer of Customs (CEO) following a valid application by Procast Australia Pty Ltd, and it came into force on 15 February 2008, the date on which the application was lodged. This concession is contingent on the condition that no substitutable goods were produced in Australia on the day the application was made. The order specifies that these concrete mixing plants are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, reducing the duty rate from 5% to free. The order does not disadvantage any person, other than the Commonwealth, and does not impose any liabilities on any person in relation to actions taken before the date of registration.
Key Provisions
The primary sections of this legislation are sections 269C, 269F, 269P, and 269S, which provide the framework for Tariff Concession Orders (TCOs). Section 269F outlines the process by which a person can apply to the Chief Executive Officer of Customs (CEO) for a TCO, while section 269C specifies that a TCO application meets the core criteria if no substitutable goods were produced in Australia at the time of application. If the CEO is satisfied that the application meets these criteria, they must make a written order (section 269P(3)), which is a TCO, and declare that the goods are to which a specified item in Schedule 4 to the Customs Tariff Act 1995 applies (section 269P(3)).
The Act imposes specific obligations on both the CEO and applicants for TCOs. The CEO must ensure that applications are processed according to the stipulated criteria and must make a decision based on whether the application meets the core criteria as outlined in section 269C. The CEO must also publish a notice in the Gazette inviting submissions from any interested parties who might have reasons why the TCO should not be made (section 269K(1)). On the other hand, applicants must ensure their applications are complete and meet the criteria, particularly that no substitutable goods were produced in Australia on the day the application was lodged.
In terms of enforcement and penalties, the Customs Act 1901 does not explicitly state penalties for breaches related to TCOs. However, the broader Customs Act includes provisions for offences and penalties for breaches of customs regulations, which could apply if someone misuses the TCO provisions. The severity of penalties can vary, but they may include fines and, in some cases, imprisonment. It is important for all parties involved to adhere strictly to the requirements of the Act to avoid any potential legal repercussions.