EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0803842
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 0803842 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. 0803842 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 Tariff Concession Instrument No. 0803842, enacted in 2008, was introduced under the Customs Act 1901 to provide a concessional tariff rate for certain types of aluminium plates, sheets, or strips imported into Australia. This legislation was developed in response to an application from Empire Resources Pacific Ltd, which sought tariff concessions for these specific goods. The instrument was authorised by the Chief Executive Officer of Customs (CEO), who determined that no substitutable goods were produced in Australia at the time of the application, thus meeting the core criteria outlined in the Customs Act. The objective of this instrument is to facilitate trade by reducing the duty on these imports from the general rate of 5% to a rate of zero, thereby benefiting importers who may apply for a refund of duty on goods imported since the instrument came into force on 7 March 2008.
Scope and Application
The Customs Act 1901, through its Tariff Concession Instrument No. 0803842, establishes a framework for the Chief Executive Officer of Customs to grant tariff concessions on specific goods. This Act applies to individuals or entities that apply for tariff concession orders on goods not specified in section 269SJ, ensuring that these goods are not produced in Australia in the ordinary course of business. The application process involves submitting an application to the CEO, who must then determine whether the application meets the core criteria as outlined in sections 269C, 269D, and 269E of the Act. If the criteria are met, a written order is issued, providing a concession on the customs duty applicable to the specified goods. The geographic reach of this Act is national, with the concessions applying throughout Australia.
Additionally, the Act provides for the publication of notices in the Gazette to invite submissions from any interested parties, although in the case of TCO No. 0803842, no submissions were received. The commencement of the TCO is retroactive to the date the application was lodged, ensuring that the rights of importers are protected and that no liabilities are imposed on individuals or entities prior to the registration date. The application of this legislation is further refined through subordinate instruments such as the Customs Tariff Act 1995, which specifies the particular duty rates and goods covered under the concessions.
Key Provisions
The primary operative sections of the Customs Act 1901, particularly in relation to Tariff Concession Orders (TCO), include sections 269C, 269B, 269D, 269E, 269F, 269P, and 269SJ (269C, 269B, 269D, 269E, 269F, 269P, and 269SJ). Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of goods. If the application is not for goods specified in section 269SJ and meets the core criteria outlined in section 269C, the CEO must make a written order (a TCO). Section 269C specifies that a TCO application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Definitions of key terms such as "goods produced in Australia," "ordinary course of business," and "substitutable goods" are provided in sections 269B, 269D, and 269E.
The Act imposes certain obligations on the parties involved. The CEO of Customs must assess whether a TCO application meets the core criteria, which involves determining whether any substitutable goods were produced in Australia on the day the application was lodged. If the CEO is satisfied that the application meets these criteria, a TCO must be issued. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made. Empire Resources Pacific Ltd, in this instance, successfully applied for a TCO for certain aluminium plates, sheets, or strips, as the CEO found that no substitutable goods were produced in Australia.
The Customs Act 1901 does not specify criminal offences or penalties directly related to the failure to comply with the provisions regarding TCOs. However, non-compliance with the conditions or misuse of the concession could potentially lead to civil or administrative penalties. For example, if a party were to improperly claim a tariff concession or fail to meet other regulatory requirements related to the importation or duty payment, they could face legal consequences such as fines or other administrative actions. The precise penalties would depend on the specific breaches and the applicable laws governing customs and trade.