EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0802936
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.
Global Synthetics Pty Ltd applied for a TCO in respect of certain geogrids on 10 April 2008.
Instrument
TCO No 0802936 was made on 04 July 2008. It declares that those certain geogrids 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. 0802936 is taken to have come into force on 10 April 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 the administration of customs and excise duties, including provisions for Tariff Concession Orders (TCOs). These orders allow for reduced customs duty rates on certain goods, facilitating trade and economic efficiency by providing tariff relief where appropriate. The Tariff Concession Instrument No. 0802936, issued under the Customs Act, addresses the need for tariff concessions on specific goods by determining their eligibility based on the absence of substitutable goods produced domestically. This instrument was enacted to ensure that the application process for tariff concessions is transparent and allows for public input, while also protecting the rights of importers by potentially enabling duty refunds on eligible goods.
Scope and Application
The Tariff Concession Instrument No. 0802936 pertains to the Customs Act 1901 and is concerned with the granting of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). This legislation applies to individuals or entities that seek to have a lower rate of customs duty applied to specific goods, provided these goods meet the core criteria outlined in the Act. The primary focus is on goods that are not currently produced in Australia, ensuring that the concessions do not undermine local production. The instrument extends its application to any party that has lodged a valid application for a TCO, and it mandates that such applications undergo a scrutiny process to ascertain whether they meet the specified criteria. Geographically, the application of this Act is national, as it operates under the purview of the Commonwealth. The Act does not extend to goods listed in section 269SJ of the Customs Act 1901, which are excluded from the scope of TCOs. Additionally, the Act can be further detailed or modified through subordinate instruments, thereby allowing for flexibility in its application and ensuring it adapts to changing economic and trade circumstances.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0802936, under the Customs Act 1901, are sections 269C, 269F, 269P, and 269S, which establish the framework for applying and processing Tariff Concession Orders (TCOs). Section 269F allows an individual or entity to apply to the Chief Executive Officer of Customs (CEO) for a TCO in relation to certain goods. The CEO must then assess the application against the core criteria outlined in section 269C. If the application meets these criteria, a TCO can be issued, which declares the goods to which a particular rate of duty applies (section 269P(3)). The commencement of the TCO is effective from the date the application is lodged, as specified in section 269S(1).
The Act imposes several obligations on the parties involved in the process of obtaining a TCO. The applicant must submit a valid application to the CEO, ensuring that the goods in question are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. The CEO must then determine if the application meets the core criteria, specifically that no substitutable goods were produced in Australia in the ordinary course of business on the date of the application. If the CEO is satisfied with the application, they must issue a written TCO. Additionally, the CEO is required to publish a notice in the Gazette, inviting any interested parties to submit objections to the TCO (subsection 269K(1)).
Failure to comply with the provisions of the Customs Act 1901 regarding TCOs may result in various consequences. While the explanatory statement does not explicitly detail specific offences or penalties, breaches of the Act could lead to civil or criminal liabilities under other relevant sections of the Act. The maximum penalties for contraventions of the Customs Act could include fines and imprisonment, depending on the nature and severity of the breach. It is important to note that the Act does not disadvantage any person or impose liabilities in respect of actions taken before the registration of the TCO, and it beneficially affects the rights of importers who can apply for a refund of duty on goods imported since the TCO came into force.