EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0803089
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.
Joe White Maltings Pty Ltd applied for a TCO in respect of certain malting kiln heat exchangers on 26 February 2008.
Instrument
TCO No 0803089 was made on 16 May 2008. It declares that those certain malting kiln heat exchangers 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. 0803089 is taken to have come into force on 26 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 Australian Parliament, establishes a framework for the regulation of customs and excise duties, amongst other things. It includes provisions for Tariff Concession Orders (TCOs) under Part XVA, which allow for a lower rate of customs duty on specified goods. The primary issue addressed by this legislative framework is the facilitation of trade by reducing customs duties on certain imported goods, thereby supporting economic efficiency and competitiveness. The explanatory statement outlines the process for applying for a TCO and the conditions under which the Chief Executive Officer of Customs (CEO) may grant such an order. In the case of Joe White Maltings Pty Ltd's application for a TCO concerning certain malting kiln heat exchangers, the CEO was satisfied that the application met the core criteria, resulting in Tariff Concession Order No. 0803089, which grants a duty-free status to these specific goods. This order effectively commenced on the date the application was lodged, 26 February 2008, and no submissions were received opposing the order.
Scope and Application
The Tariff Concession Instrument No. 0803089 under the Customs Act 1901 applies to goods specified in the instrument, namely certain malting kiln heat exchangers, which are now subject to a reduced rate of customs duty following the instrument's enactment. The Act empowers the Chief Executive Officer of Customs to issue Tariff Concession Orders (TCOs) that lower the customs duty on goods, provided certain criteria are met. In this case, the CEO determined that no substitutable goods were produced in Australia, satisfying the core criteria outlined in section 269C of the Act. This instrument operates nationally across Australia and affects all entities and individuals importing the specified goods. The instrument does not impose any disadvantages or liabilities on persons other than the Commonwealth and does not affect rights as at the date of registration. It is noteworthy that the instrument's effectivity is backdated to the date the application was lodged, ensuring that no party is disadvantaged by the delay in issuing the instrument.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0803089 under the Customs Act 1901 (section 269F) allow the Chief Executive Officer of Customs (CEO) to make Tariff Concession Orders (TCOs) for specific goods, provided certain criteria are met. Section 269C stipulates that a TCO application is valid if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Section 269P(3) mandates that if the CEO is satisfied the application meets the core criteria, a written TCO must be issued. Instrument 0803089, made on 16 May 2008, declares that certain malting kiln heat exchangers are subject to item 50 of Schedule 4 of the Customs Tariff Act 1995, with the duty rate being free, as opposed to the general rate of 5%.
The Act imposes several obligations on the parties involved. Firstly, the CEO must review TCO applications to ensure they meet the core criteria, specifically that no substitutable goods were produced in Australia on the day the application was lodged (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 (subsection 269K(1)). Additionally, the CEO must decide whether to make the TCO based on the application and any submissions received (section 269P(3)). In this case, no submissions were received, and the TCO was issued as Joe White Maltings Pty Ltd's application met the criteria.
Failure to comply with the requirements of the Customs Act 1901 can lead to various penalties and consequences. While the explanatory statement does not detail specific offences or penalties related to TCOs, general provisions in the Customs Act may apply. For example, section 263 of the Act provides for civil and criminal penalties for offences such as providing false or misleading information in an application, which could include fines and imprisonment. Additionally, section 264 addresses offences related to the importation of goods, potentially leading to fines and penalties for non-compliance. However, the explanatory statement specifies that the TCO does not impose any new liabilities on any person, and it does not affect the rights of a person as at the date of registration. Importers of the affected goods can apply for a refund of duty under paragraph 126(1)(r) of the Regulations, benefiting from the concession without incurring any new liabilities.