EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0810247
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.
Amcor Packaging Pty Ltd applied for a TCO in respect of certain dewatering screw press on 27 May 2008.
Instrument
TCO No 0810247 was made on 15 August 2008. It declares that those certain dewatering screw press 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. 0810247 is taken to have come into force on 27 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 Tariff Concession Instrument No. 0810247 was enacted in 2008 under the Customs Act 1901 to address the need for a more streamlined process in reducing customs duties on specific imported goods through Tariff Concession Orders (TCOs). The instrument was introduced by the Parliament of Australia to facilitate the application and processing of tariff concessions, aiming to support Australian industries by making imported goods more competitively priced. The policy objective behind this legislation is to ensure that Australian businesses can access necessary imported goods at a lower cost, thereby promoting economic efficiency and competitiveness without disadvantaging any existing parties. The instrument came into effect on the date the application was lodged, and it provides a mechanism for the Chief Executive Officer of Customs to grant tariff concessions where applicable.
Scope and Application
The Customs Act 1901, under Part XVA, establishes a framework through which the Chief Executive Officer (CEO) of Customs may issue Tariff Concession Orders (TCOs) that apply a reduced rate of customs duty on specified goods. The application of this Act is directed towards individuals or entities seeking a reduction in customs duty on goods they wish to import, provided that these goods meet certain criteria, such as not being substitutable by goods produced in Australia in the ordinary course of business. The geographic reach of this legislation is nationwide, impacting all importers across Australia. It is noteworthy that the Act does not apply to goods specified in section 269SJ, which includes certain categories of goods that are ineligible for tariff concessions. The scope of the Act is further extended through subordinate instruments, which may specify additional conditions or exclusions. The Tariff Concession Instrument No. 0810247, for instance, exemplifies this by declaring certain dewatering screw presses to be exempt from the general 5% duty rate, contingent upon the absence of Australian-produced substitutes. The application of these concessions is retroactive to the date of the application, ensuring that importers can claim refunds for duties paid on eligible goods imported since that date, without any retroactive imposition of liabilities.
Key Provisions
The key operative sections of Tariff Concession Instrument No. 0810247 (TCO No. 0810247) under the Customs Act 1901 require the Chief Executive Officer of Customs (CEO) to assess whether certain dewatering screw presses meet the core criteria for a Tariff Concession Order (TCO) (section 269C). If the CEO is satisfied that the application for the TCO is valid and meets these criteria, they must make a written order declaring that the goods in question are subject to a tariff concession (section 269P(3)). This tariff concession applies to the dewatering screw presses specified in item 50 of Schedule 4 to the Customs Tariff Act 1995, which changes the duty rate from 5% to free. The instrument also mandates that the CEO must publish a notice in the Gazette inviting any interested parties to submit objections to the TCO if they believe it should not proceed (subsection 269K(1)). In this instance, the CEO did not receive any submissions against the TCO.
The Act imposes specific obligations and requirements on the parties involved. The CEO must ensure that the application for a TCO is valid and meets the core criteria, which include verifying that no substitutable goods were produced in Australia on the day the application was lodged (section 269C). The CEO must also ensure that the goods specified in the application are not those listed in section 269SJ of the Act, which are ineligible for a TCO. Once the CEO is satisfied that the application meets these criteria, they must issue a TCO and publish a notice in the Gazette, allowing for any objections to be raised (subsection 269K(1)). The CEO must also ensure that the TCO does not adversely affect the rights of any person, other than the Commonwealth, who may have rights as of the date of the TCO registration (subsection 269S(1)). Importers of the specified goods can apply for a refund of duty under paragraph 126(1)(r) of the Regulations for goods imported since the TCO came into force.
Breaching the requirements or obligations set out in the Customs Act 1901 can lead to serious consequences. Offences under the Customs Act can result in civil or criminal penalties. For example, knowingly making a false statement in an application for a TCO could lead to a criminal offence, with a maximum penalty of 2,000 penalty units or imprisonment for five years, or both, under section 274A of the Act. In addition, any person who knowingly contravenes a TCO may face civil penalties, including fines of up to 10,000 penalty units under section 283D of the Act. These penalties underscore the importance of complying with the Act's provisions and the obligations it imposes on applicants and the CEO.