EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0808975
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.
Iluka Resources Pty Ltd applied for a TCO in respect of certain wet concentrator plant on 20 May 2008.
Instrument
TCO No 0808975 was made on 18 August 2008. It declares that those certain wet concentrator 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. 0808975 is taken to have come into force on 20 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, provides a framework for managing customs duties, including a scheme for Tariff Concession Orders (TCOs) under Part XVA. The primary problem this legislation addresses is the need to facilitate the importation of certain goods that are not domestically produced by providing a lower rate of customs duty. This encourages the importation of goods that would otherwise be unavailable or prohibitively expensive in Australia, thereby supporting industries that rely on such imports. The Tariff Concession Instrument No. 0808975, introduced under this Act, specifically aims to provide a tariff concession for certain wet concentrator plant, allowing for their importation duty-free. This instrument was enacted to ensure that the application for tariff concessions is processed efficiently and transparently, with an opportunity for public consultation, although in this instance, no submissions were received. The policy objective is to support the importation of critical goods, benefiting industries that cannot produce these goods domestically.
Scope and Application
The Tariff Concession Instrument No. 0808975 applies to the concession of customs duty for certain wet concentrator plant under the Customs Act 1901. This Act applies to individuals and entities that are subject to customs duty on the importation of goods. Specifically, the instrument applies to Iluka Resources Pty Ltd, which applied for the concession on 20 May 2008. The geographic and jurisdictional reach of the Act is national, as it is a Commonwealth Act. The application of the Act extends to the reduction of customs duty rates for the specified goods, provided that no substitutable goods are produced in Australia in the ordinary course of business. Any person considering that there are reasons why the Tariff Concession Order should not be made is invited to lodge a submission with the Chief Executive Officer of Customs, although in this case, no submissions were received. The Act does not disadvantage any person and does not impose any liabilities on any person in respect of anything done or omitted to be done before the date of registration. The order itself does not affect the rights of any person as at the date of registration, and importers of the goods will be able to apply for a refund of duty on goods imported since the day on which the Tariff Concession Order is taken to have come into force.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0808975 under the Customs Act 1901 (section 269C) provide that a Tariff Concession Order (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. The instrument (section 269P(3)) declares that certain wet concentrator plant are goods to which a specified item of Schedule 4 to the Customs Tariff Act 1995 applies, as the Chief Executive Officer of Customs (CEO) was satisfied that no substitutable goods were produced in Australia. The general rate of duty on these goods is 5%, but the rate of duty for the goods subject to the TCO is free.
The obligations and requirements imposed by the Act on the parties or entities it governs include the necessity for the CEO to publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made (subsection 269K(1)). The CEO must also determine if the TCO application meets the core criteria, specifically assessing whether no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (section 269C). Once satisfied, the CEO must make a written order declaring that the goods the subject of the TCO application are goods to which a prescribed item of Schedule 4 to the Tariff applies (subsection 269P(3)). The TCO is taken to have come into force on the day on which the application for the TCO was lodged (subsection 269S(1)).
In terms of offences, penalties, or civil/criminal consequences for breach, the Customs Act 1901 does not explicitly state specific penalties for non-compliance with the TCO provisions. However, it is implied that failure to comply with the conditions set by a TCO or any related obligations could potentially lead to legal ramifications. For instance, any actions that contravene the terms of the TCO might result in penalties under the broader customs regulations, which can include fines or other legal sanctions. The precise penalties would depend on the specific breach and the applicable provisions of the Customs Act and associated regulations.