EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0804547
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.
Procast Australia Pty Ltd applied for a TCO in respect of certain concrete panel plant on 25 March 2008.
Instrument
TCO No 0804547 was made on 20 June 2008. It declares that those certain concrete panel plant 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. 0804547 is taken to have come into force on 25 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, provides a framework for the administration of customs duties and includes provisions for Tariff Concession Orders (TCOs) that allow for the reduction or exemption of customs duty on certain goods. This legislative instrument, F2008L02501, was introduced to address the need for concessional tariff treatment for goods that are not produced in Australia and do not have substitutable domestic alternatives. The policy objective is to support industries by reducing the cost of imported goods that are essential for production but cannot be manufactured locally. The Customs Act allows the Chief Executive Officer of Customs to make a TCO if an application is made and the core criteria, including the non-existence of substitutable goods produced in Australia, are met. The Explanatory Statement outlines the process for the application, review, and publication of a TCO, and specifies that the concessional tariff treatment applies from the date the application was lodged. This instrument ensures that importers can benefit from reduced duty rates while not imposing any liabilities or disadvantaging other stakeholders.
Scope and Application
The Tariff Concession Instrument No. 0804547 under the Customs Act 1901 applies to goods specified in the instrument, namely certain concrete panel plant, and is directed at the Chief Executive Officer of Customs who is responsible for making the Tariff Concession Order (TCO) if the application criteria are met. The Act allows for individuals or entities, such as Procast Australia Pty Ltd in this case, to apply for tariff concessions on goods they import, provided these goods are not excluded under section 269SJ of the Act and the application meets the core criteria as outlined in sections 269C, 269B, and 269D of the Act. The instrument grants a tariff concession on these specific goods, reducing their customs duty from the general rate of 5% to free, effective from the date the application was lodged, 25 March 2008. The instrument’s jurisdictional reach is governed by the Commonwealth, and it does not extend to imposing any liabilities on any person, nor does it affect the rights of any person other than the Commonwealth prior to the date of registration. The instrument can be further extended or restricted through subordinate instruments, although none are mentioned in the provided text.
Key Provisions
The Customs Act 1901, specifically under Part XVA, outlines the process for Tariff Concession Orders (TCOs) and the circumstances under which they can be granted. A TCO can be applied for by any person, and if the application is deemed valid, a lower rate of customs duty can be applied to the goods in question (section 269F). The CEO of Customs must determine if the application meets the core criteria as stipulated in section 269C, which requires that on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. If these criteria are satisfied, the CEO must make a written order declaring the goods to which a specified item of Schedule 4 to the Customs Tariff Act 1995 applies (subsection 269P(3)).
The obligations under the Act are clear and specific. The CEO must first ensure that the application is valid and not in respect of goods specified in section 269SJ, which includes certain restricted goods. The CEO must also check that the application meets the core criteria by verifying that no substitutable goods were produced in Australia in the ordinary course of business. If these conditions are met, the CEO is required to publish a notice in the Gazette inviting any person who may have an objection to the TCO to lodge a submission (subsection 269K(1)). After considering any submissions, the CEO must issue the TCO if the application meets all the necessary criteria. Additionally, the TCO must be registered, and the date of registration marks the effective date of the concession, although the rights of persons other than the Commonwealth will not be adversely affected by this registration.
There are consequences for non-compliance with the provisions of the Customs Act 1901, particularly if a person provides false or misleading information in an application for a TCO. Section 281D of the Act outlines that it is an offence to provide such information, and a person found guilty of this offence may face a penalty of up to 50 penalty units, which equates to a substantial financial penalty. The Act does not specify any civil consequences for breach, but it is clear that any misrepresentation in the application process can result in criminal charges. Additionally, the Act ensures that the rights of importers are beneficially affected, and they can apply for a refund of duty on goods imported since the TCO is taken to have come into force.