EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0803090
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 kiln loaders and unloaders on 26 February 2008.
Instrument
TCO No 0803090 was made on 16 May 2008. It declares that those certain kiln loaders and unloaders 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. 0803090 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 Tariff Concession Instrument No. 0803090 was enacted in 2008 under the Customs Act 1901 to address the need for tariff concessions on specific goods where no substitutable goods are produced in Australia. This instrument, which was developed in response to an application by Joe White Maltings Pty Ltd for tariff concessions on certain kiln loaders and unloaders, aims to provide relief from customs duties on these goods, thereby potentially stimulating their importation and use. The enactment of this instrument by the Chief Executive Officer of Customs (CEO) was made possible under section 269F of the Customs Act 1901, which allows for the application of tariff concessions on goods that meet the specified criteria. The instrument came into force on the date of the application, 26 February 2008, and does not impose any liabilities on any person other than the Commonwealth. It also ensures that importers of such goods can apply for a refund of duty from the date the concession is effective.
Scope and Application
The Tariff Concession Instrument No. 0803090 under the Customs Act 1901 applies to specific goods, namely kiln loaders and unloaders, for which Joe White Maltings Pty Ltd applied for a Tariff Concession Order (TCO) on 26 February 2008. The application was approved and a TCO was issued on 16 May 2008, reducing the duty on these goods from the general rate of 5% to free. This concession applies to the import of these goods from the date the application was lodged, which is 26 February 2008, and it does not affect the rights of any person other than the Commonwealth nor impose any liabilities on any person. The Act extends to the Commonwealth jurisdiction and any person considering that there are reasons why the TCO should not be made could have lodged a submission with the Chief Executive Officer of Customs, but no such submissions were received. The instrument is an example of how the Customs Act 1901 allows for the reduction of customs duty through TCOs, provided the goods meet the criteria of not being substitutable by goods produced in Australia in the ordinary course of business.
Key Provisions
The main provisions of Tariff Concession Instrument No. 0803090 under the Customs Act 1901 (section 269F) allow the Chief Executive Officer of Customs (CEO) to grant a Tariff Concession Order (TCO) which applies a lower rate of customs duty to specific goods. This particular TCO, number 0803090, was applied to certain kiln loaders and unloaders as of 16 May 2008, declaring these goods to be subject to a free rate of duty as specified under item 50 of Schedule 4 to the Customs Tariff Act 1995, down from the general rate of 5%. The CEO must ensure that the application for a TCO meets core criteria, notably that no substitutable goods are produced in Australia in the ordinary course of business (section 269C). For this TCO, the CEO confirmed that no such substitutable goods were being produced, thus satisfying the criteria for the concession.
The Act imposes specific obligations on parties applying for a TCO. An applicant, such as Joe White Maltings Pty Ltd, must submit an application to the CEO, which includes details of the goods in question. The CEO is obligated to assess the application against the core criteria, including ensuring that the goods do not fall under the category of goods that cannot be subject to a TCO as specified in section 269SJ. Additionally, the CEO must publish a notice in the Gazette (subsection 269K(1)) inviting any interested party to submit objections if they believe the TCO should not be granted. In this instance, no objections were received, which facilitated the granting of the TCO.
Should any party fail to comply with the requirements set forth by the Customs Act 1901, there may be civil or criminal consequences. While the explanatory statement does not explicitly detail penalties for breaches, under Australian law, non-compliance with customs regulations can result in fines and potential imprisonment. The exact penalties would depend on the specific nature of the breach and the provisions of the relevant legislation. However, for the purposes of this TCO, the Act ensures that the rights of importers are protected and that no new liabilities are imposed on them, meaning any retrospective duty payments could be refunded under the appropriate regulations (paragraph 126(1)(r) of the Regulations).