EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0803925
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.
Kurrajong Kitchens applied for a TCO in respect of certain lavosh bread forming line on 11 March 2008.
Instrument
TCO No 0803925 was made on 06 June 2008. It declares that those certain lavosh bread forming lines 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. 0803925 is taken to have come into force on 11 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 was enacted by the Australian Parliament to provide for the administration of customs and excise, including the collection of duties. The Tariff Concession Instrument No. 0803925, issued in 2008, is a regulation under Part XVA of the Customs Act 1901. This particular instrument addresses the need to provide tariff concessions for specific goods, in this case, certain lavosh bread forming lines, to facilitate their importation by reducing the rate of customs duty from the general rate of 5% to free. The policy objective is to support Australian businesses by ensuring they have access to necessary equipment, thereby fostering competitiveness and efficiency within the industry. The instrument was created following an application by Kurrajong Kitchens, and after the Chief Executive Officer of Customs was satisfied that no substitutable goods were produced in Australia, the instrument was published in the Gazette with no submissions against it. This process ensures that the tariff concession does not disadvantage any party and benefits importers by allowing them to apply for a refund of duty on goods imported since the day the TCO came into force.
Scope and Application
The Tariff Concession Instrument No. 0803925 under the Customs Act 1901 applies to entities and individuals involved in the importation of certain lavosh bread forming lines, granting them tariff concessions on these goods. The scope of this Act is specifically targeted at facilitating the importation of these goods by reducing the customs duty rate from the general rate of 5% to free, provided the application meets the core criteria as specified in the Act. This concession applies to the goods specified in the instrument and does not extend to any other goods unless explicitly included in a subsequent TCO. The application of this Act is national, as it operates under the Commonwealth jurisdiction and affects importers across Australia.
The Act excludes goods specified in section 269SJ of the Customs Act 1901, which cannot be subject to a TCO. Furthermore, the application process mandates that the CEO must be satisfied that no substitutable goods were produced in Australia on the date the application was lodged, ensuring that the concession is only applicable in the absence of domestic production of equivalent goods. The instrument does not disadvantage any person by affecting their rights as at the date of registration, and it imposes no liabilities on any person. Instead, it benefits importers by potentially allowing them to apply for a refund of duty on goods imported since the day the TCO is deemed to have come into force.
Key Provisions
The main operative sections of this legislation (sections 269C, 269B, 269D, 269E, 269P, and 269SJ) establish the framework for Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269C stipulates that a TCO application meets the core criteria if no substitutable goods were produced in Australia at the time the application was lodged, as defined in section 269B. Section 269P(3) mandates that if the Chief Executive Officer of Customs (CEO) is satisfied that the application meets these core criteria, they must make a written order (a TCO) applying a prescribed item of Schedule 4 to the Customs Tariff Act 1995. Section 269SJ specifies that certain goods, such as those listed under this section, cannot be subject to a TCO.
The obligations and requirements imposed by the Act on the parties it governs are primarily centred around the application and approval processes for TCOs. The CEO is required to assess whether an application for a TCO meets the core criteria as specified in sections 269C and 269SJ. If the CEO determines that the application is valid and meets the criteria, they must issue a written TCO. Additionally, as per subsection 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any person who may have reasons why the TCO should not be made.
There are no specific offences outlined in the Act for breaching the provisions related to TCOs. However, failure to comply with the requirements set out in the Act, such as submitting a false application or providing misleading information, could potentially lead to civil or criminal consequences under other relevant sections of the Customs Act 1901. For example, providing false information to the CEO could result in penalties under section 262 of the Act, which covers offences related to false statements and documents. The maximum penalties for such offences could include fines and imprisonment, as stipulated in the respective sections of the Act.