EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0802867
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.
Hunter Douglas Limited applied for a TCO in respect of certain aluminium alloy sheet and or strip coils on 21 February 2008.
Instrument
TCO No 0802867 was made on 09 May 2008. It declares that those certain aluminium alloy sheet and or strip coils 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. 0802867 is taken to have come into force on 21 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, as supplemented by the Tariff Concession Instrument No. 0802867 enacted in 2008, provides a mechanism for granting tariff concessions on specific goods through Tariff Concession Orders (TCOs). This legislative instrument addresses the problem of ensuring that Australian businesses can access certain goods at a lower customs duty rate when no substitutable goods are produced domestically. The instrument empowers the Chief Executive Officer of Customs to make these orders if certain criteria are met, ensuring that the decision-making process is transparent and inclusive by inviting public submissions. This legislative framework aims to foster a competitive environment by facilitating the importation of goods that are not produced in Australia, thereby benefiting importers who can now potentially claim duty refunds for goods imported since the TCO came into effect. The instrument was enacted by the Parliament of Australia and seeks to balance the interests of domestic producers with those of importers and consumers.
Scope and Application
The Customs Act 1901, as augmented by Tariff Concession Instrument No. 0802867, applies to entities seeking tariff concessions on specific goods, particularly in this instance, aluminium alloy sheet and strip coils. The application of this instrument is confined to those who have applied for and met the core criteria for a Tariff Concession Order (TCO) under the Act, with the CEO of Customs being the authority responsible for the decision-making process. The instrument's scope extends to the particular aluminium alloy sheets and coils specified in the application by Hunter Douglas Limited, and the instrument itself applies nationally across Australia, aligning with the overarching framework of the Customs Act 1901. Notably, the instrument does not apply to goods that are explicitly prohibited under section 269SJ of the Act, such as those that are substitutable with goods produced in Australia. The application of the TCO is effective from the date the application was lodged, and it ensures that no existing rights or liabilities of any person, other than the Commonwealth, are adversely affected by the concession.
Key Provisions
The Customs Act 1901, as amended by Tariff Concession Instrument No. 0802867, introduces provisions that allow for the concession of customs duties on specified goods. Section 269F (2) enables an application for a Tariff Concession Order (TCO) to be made by any interested party, with the Chief Executive Officer of Customs (CEO) being the authority responsible for deciding whether the application meets the core criteria (section 269C). The key requirement here is that the goods for which the concession is sought must not have substitutable goods produced in Australia at the time the application is lodged (section 269P(3)). If the CEO determines that the application meets these criteria, they are mandated to issue a written order (TCO) specifying the reduced rate of duty applicable to the goods (section 269P(4)).
The obligations imposed by this legislation on the parties involved are primarily centred on the application process and the conditions that must be satisfied for a TCO to be granted. The applicant must ensure that the goods specified in the application do not have substitutable alternatives produced in Australia. Additionally, the CEO must publish a notice in the Gazette once an application is accepted as valid, inviting any interested parties to lodge submissions if they believe the TCO should not proceed (section 269K(1)). The CEO is also required to evaluate the application against the core criteria to determine if the concession is appropriate.
Failure to comply with the provisions of the Customs Act 1901, particularly in relation to the submission of false information in an application for a TCO, can lead to significant legal consequences. The Act does not specify particular offences or penalties within the explanatory statement, but generally, making false statements or misrepresentations in applications for government benefits can result in criminal charges, including fines and imprisonment, under Australian law. The specific penalties would be determined by the courts based on the nature and severity of the offence.
The Tariff Concession Instrument No. 0802867, which came into force on 21 February 2008, specifically applies to certain aluminium alloy sheet and strip coils. This instrument reduces the duty on these goods from the general rate of 5% to free, provided no substitutable goods are produced in Australia. The TCO does not affect any pre-existing rights or impose new liabilities on individuals or entities other than the Commonwealth. Importers of the affected goods will be able to apply for refunds of duties paid on imports since the TCO's effective date, as per paragraph 126(1)(r) of the Regulations. This legislative instrument is designed to provide tariff relief for specific goods, facilitating their import while ensuring compliance with the statutory requirements.