EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0807191
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.
Hillgrove Copper Pty Limited applied for a TCO in respect of certain grinding mill parts on 08 May 2008.
Instrument
TCO No 0807191 was made on 04 August 2008. It declares that those certain grinding mill parts 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. 0807191 is taken to have come into force on 08 May 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 Australian Parliament, serves to regulate the importation of goods into Australia. Specifically, Part XVA of the Act establishes a framework for Tariff Concession Orders (TCOs), which can be issued by the Chief Executive Officer of Customs to apply lower rates of customs duty on certain goods. The 2008 Tariff Concession Instrument No. 0807191, issued under this Act, was introduced to address the specific needs of Hillgrove Copper Pty Limited, which sought a tariff concession for certain grinding mill parts. The policy objective of this legislation is to facilitate the importation of goods that are not produced domestically, thereby promoting trade and economic efficiency without disadvantaging existing rights or imposing new liabilities on individuals or entities.
Scope and Application
The Tariff Concession Instrument No. 0807191 under the Customs Act 1901 applies to specific goods, namely certain grinding mill parts, and provides for tariff concessions that reduce the customs duty on these goods from the general rate to a rate of zero. This concession applies to any entity or individual importing these parts, provided the application for the tariff concession was lodged on or after 08 May 2008, the date this instrument is taken to have come into force. The instrument is administered by the Chief Executive Officer of Customs, who must ensure that the goods in question are not substitutable by Australian-made products and meet the specified criteria under the Customs Act 1901 and related sections. The geographic and jurisdictional reach of this legislation is national, as it applies across Australia. Importantly, the instrument does not impose any liabilities or disadvantage any person other than the Commonwealth and allows for the refund of duties paid on the specified goods since the effective date of the concession.
Key Provisions
The Tariff Concession Instrument No. 0807191, issued under the Customs Act 1901, introduces a tariff concession order (TCO) for specific grinding mill parts, granting them a duty-free status. This concession applies to goods specified in item 50 of Schedule 4 to the Customs Tariff Act 1995, where the general duty rate is 5%. The operative sections of this instrument (sections 269C, 269F, 269P(3), and 269S(1)) establish the criteria for TCO applications and the process for the CEO of Customs to make such orders. According to section 269F, an applicant can request a TCO if the goods are not specified in section 269SJ, which lists goods ineligible for TCOs. Section 269C mandates that a TCO application meets core criteria if no substitutable goods were produced in Australia at the time of application. If the CEO determines that the application meets these criteria, they are required under section 269P(3) to issue a written TCO.
The obligations imposed by this Act on the parties involved are primarily centred on the application and assessment process for TCOs. The CEO of Customs must, upon receiving a valid TCO application, ensure that it meets the core criteria, specifically that no substitutable goods were produced in Australia (section 269C). Additionally, the CEO is mandated to publish a notice in the Gazette inviting public submissions on the application (subsection 269K(1)). The applicant, in this case, Hillgrove Copper Pty Limited, must provide all necessary information and evidence to support their claim that no substitutable goods were produced in Australia.
Failure to comply with the requirements of the Customs Act 1901 or any orders made under it may result in various consequences. While the explanatory statement does not explicitly list offences or penalties for breach, the Act generally provides for both civil and criminal penalties for non-compliance with customs regulations. Under section 274 of the Act, an individual or entity found guilty of an offence can be subject to fines and imprisonment. The severity of penalties can vary based on the nature and extent of the breach, with more serious offences potentially leading to higher fines and longer imprisonment terms. Furthermore, the Act includes provisions for the recovery of unpaid duties and interest, as well as potential administrative actions by the Australian Border Force.