EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0804719
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.
TFH Australia Pty Ltd applied for a TCO in respect of certain stonewall cubes, blocks or slabs on 26 March 2008.
Instrument
TCO No 0804719 was made on 13 June 2008. It declares that those certain stonewall cubes, blocks or slabs 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. 0804719 is taken to have come into force on 26 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 Parliament of Australia to regulate the importation and exportation of goods, among other things. This legislation establishes a framework under which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs, providing for lower rates of customs duty on specified goods. The Tariff Concession Instrument No. 0804719 was introduced to address the specific issue of applying tariff concessions to certain stonewall cubes, blocks, or slabs, as requested by TFH Australia Pty Ltd. The primary policy objective of this instrument is to ensure that no substitutable goods were produced in Australia at the time of application, thereby justifying the concession. The instrument, effective from the date of the application, aims to streamline the tariff concession process while benefiting importers by potentially allowing them to claim duty refunds for goods imported since the TCO's effective date.
Scope and Application
The Tariff Concession Instrument No. 0804719 applies to the Customs Act 1901, specifically to Tariff Concession Orders (TCOs) that may be made by the Chief Executive Officer of Customs (the CEO). This legislation governs the process for applying for and granting tariff concessions on certain goods, whereby a lower rate of customs duty applies to goods that are the subject of a TCO. The Act applies to individuals and entities that seek tariff concessions on specific goods, provided these goods are not those prohibited by section 269SJ of the Act. The geographic reach of the Act is national, as it applies to the entire Commonwealth of Australia. The Act allows for the extension or restriction of its application through subordinate instruments, although in this particular case, no such extensions or restrictions are noted. The application of this Act is triggered when an entity such as TFH Australia Pty Ltd applies for a TCO, and the CEO determines that the application meets the specified core criteria. In the case of TCO No. 0804719, the CEO concluded that no substitutable goods were produced in Australia, allowing the concession to proceed. This instrument affects the rights of importers by enabling them to apply for a refund of duty on goods imported since the TCO came into force.
Key Provisions
The primary sections of Tariff Concession Instrument No. 0804719 under the Customs Act 1901 (section 269F) allow for the application of tariff concession orders (TCO) by entities such as TFH Australia Pty Ltd, for specific goods like stonewall cubes, blocks or slabs. This instrument was made under section 269P of the Act and provides a tariff concession for these goods, reducing the duty from the general rate of 5% to free. The core criteria for a TCO, as outlined in section 269C of the Act, require that no substitutable goods are produced in Australia on the day the application was lodged, with definitions for "substitutable goods" and "ordinary course of business" provided in sections 269D and 269E respectively.
The Act imposes obligations on the Chief Executive Officer of Customs (CEO) to assess whether an application meets the core criteria and, if satisfied, to make a written TCO order (section 269P(3)). The CEO must also publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any interested parties to submit reasons why the TCO should not be made (section 269K(1)). In this case, the CEO received no submissions in response to the published notice, facilitating the swift issuance of the TCO. Additionally, the Act requires that a TCO come into force on the day the application was lodged, which for TCO No. 0804719 is 26 March 2008 (subsection 269S(1)).
Breach of the conditions or failure to comply with the requirements of the Customs Act 1901 may lead to civil or criminal consequences. Although the specific penalties for breaches are not detailed in the explanatory statement, general provisions of the Customs Act 1901 and associated regulations could include fines and imprisonment. The exact penalties would depend on the nature and severity of the breach, as outlined in other sections of the Act and relevant regulations. The TCO itself does not impose any liabilities on any person but ensures that the rights of importers will be beneficially affected, allowing them to apply for a refund of duty on goods imported since the TCO came into force.