EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0803835
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.
Empire Resources Pacific Ltd applied for a TCO in respect of certain aluminium plates, sheets or strip on 7 March 2008.
Instrument
TCO No 0803835 was made on 30 May 2008. It declares that those certain aluminium plates, sheets or strip 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. 0803835 is taken to have come into force on 7 March 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 duties and provides for the making of Tariff Concession Orders (TCOs) under Part XVA. This framework was introduced to address the need for flexibility in the application of customs duties, particularly in circumstances where imported goods do not have substitutable domestic alternatives. Tariff Concession Instrument No. 0803835 was introduced to provide tariff concessions for certain aluminium plates, sheets, or strip, reducing their customs duty from 5% to free, effective from the date the application was lodged on 7 March 2008. The objective of this instrument is to ensure that importers of these specific goods can benefit from reduced duty rates, thereby aligning with the broader policy goal of facilitating trade and economic efficiency by providing tariff relief where appropriate.
Scope and Application
The Tariff Concession Instrument No. 0803835 under the Customs Act 1901 applies to specific goods, in this case certain aluminium plates, sheets or strips, for which a Tariff Concession Order (TCO) has been granted. This legislation is enacted at the Commonwealth level and is administered by the Chief Executive Officer of Customs. The TCO applies to the goods specified in the order, which are subject to a reduced rate of customs duty, and benefits importers of these goods by potentially allowing them to apply for a refund of duty paid on those goods imported since the effective date of the order. The TCO does not apply to goods specified in section 269SJ of the Act, which lists those goods that cannot be subject to a TCO, and it does not disadvantage or impose liabilities on any person other than the Commonwealth in respect of actions taken prior to the date of registration of the TCO. The application process involves a thorough review to ensure that no substitutable goods are produced in Australia in the ordinary course of business, and the CEO must make a written order if the application meets the core criteria. The instrument also includes provisions for public consultation, although in this instance, no submissions were received. The TCO comes into force on the date the application is lodged, as per the Act, and in this case, it was effective from 7 March 2008.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0803835 under the Customs Act 1901 include sections 269C, 269P, and 269SJ. Section 269C defines the core criteria for a Tariff Concession Order (TCO) application, stating that the order will only be considered if no substitutable goods were produced in Australia on the day the application was lodged. Section 269P(3) mandates that if the Chief Executive Officer (CEO) of Customs is satisfied that the application meets these criteria, a written order must be made declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. Section 269SJ outlines the goods that cannot be subject to a TCO.
The Act imposes several obligations on the parties involved. The CEO of Customs must ensure that a TCO application meets the core criteria as defined in section 269C, and if satisfied, issue a TCO as per section 269P. The CEO is also required to publish a notice in the Gazette, inviting submissions from any interested parties who may have objections to the TCO being made, as per subsection 269K(1). Additionally, the TCO itself, once registered, will not disadvantage any person or impose liabilities in respect of anything done or omitted before the registration date, as per subsection 269S(1).
In terms of penalties and consequences, the Act does not explicitly outline criminal or civil penalties for breach of the TCO provisions. However, the process ensures that the rights of importers are protected, and they can apply for a refund of duty on goods imported since the TCO came into force under paragraph 126(1)(r) of the Regulations. The Act's primary focus is on facilitating tariff concessions for eligible goods while ensuring a transparent and inclusive application process.