EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0812996
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.
Syngenta Crop Protection Pty Limited applied for a TCO in respect of certain fusilade herbicides on 16 June 2008.
Instrument
TCO No 0812996 was made on 22 August 2008. It declares that those certain fusilade herbicides 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. 0812996 is taken to have come into force on 16 June 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 amended to introduce a scheme allowing for Tariff Concession Orders (TCOs) to be made by the Chief Executive Officer of Customs. This was enacted to provide a mechanism through which applicants could seek a reduction in customs duty on specified goods, provided certain criteria were met. The Tariff Concession Instrument No. 0812996 was introduced on 22 August 2008 as a response to an application by Syngenta Crop Protection Pty Limited for a TCO on certain fusilade herbicides. This instrument was made to declare that these specific herbicides are subject to a zero rate of customs duty, effective from the date of the application on 16 June 2008. The decision to grant the TCO was based on the assessment that no substitutable goods were produced in Australia at the time of application, fulfilling the core criteria under the Customs Act. The policy objective of this measure is to facilitate the import of specific goods at a reduced duty rate, thereby supporting the economic interests of applicants and potentially benefiting importers who can apply for duty refunds on imports made since the TCO's effective date.
Scope and Application
The Tariff Concession Instrument No. 0812996, made under the Customs Act 1901, pertains to the application of Tariff Concession Orders (TCOs) for certain fusilade herbicides. It applies to any entity or individual involved in the importation of these specific herbicides, ensuring they are granted a lower rate of customs duty as outlined in the order. This legislation is applicable nationally and operates under the authority of the Commonwealth, specifically through the Chief Executive Officer of Customs. The Act allows for the exemption of certain goods from tariff concessions, as specified in section 269SJ of the Customs Act 1901. Importantly, this TCO does not impose any new liabilities or disadvantage any person other than the Commonwealth and does not affect rights as they stood before the registration of the order. The commencement of the TCO aligns with the date of the application, providing immediate effect from 16 June 2008, and it ensures that importers can apply for a refund of duties paid on the specified goods since this date.
Key Provisions
The primary operative sections of this legislation are sections 269C, 269F, 269P and 269S, which govern the process for making Tariff Concession Orders (TCOs). Section 269F (1) allows any person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of certain goods. If the CEO determines that the application is not for goods specified in section 269SJ of the Act and that the application meets the core criteria specified in section 269C, the CEO must make a written order (a TCO) under section 269P (3). This order declares that the goods in question are subject to a lower rate of customs duty as specified in the Customs Tariff Act 1995. The TCO will be deemed to have come into force on the day the application was lodged, as per section 269S (1).
Under this Act, the CEO has the responsibility to ensure that TCO applications meet the core criteria, specifically that no substitutable goods are produced in Australia on the day the application is lodged. The CEO must also publish a notice in the Gazette inviting submissions from any interested parties, as per subsection 269K(1). The CEO is required to consider any submissions received before deciding whether to make a TCO. In this instance, no submissions were received in response to the published notice.
The Act imposes specific obligations on the CEO regarding the processing of TCO applications. The CEO must first determine if the application pertains to goods that cannot be subject to a TCO as outlined in section 269SJ. If the CEO is satisfied that the application is valid and meets the core criteria in section 269C, they are obligated to make a TCO. Additionally, the CEO must publish a notice in the Gazette and consider any submissions received. The CEO must also ensure that the TCO does not disadvantage any person or impose liabilities on them in relation to actions taken before the TCO comes into effect.
Breach of the provisions of the Customs Act 1901 can result in various civil and criminal penalties. While the explanatory statement does not explicitly outline specific offences or penalties for non-compliance with TCOs, general penalties under the Customs Act can include fines and imprisonment. For instance, section 244 of the Act states that a person who contravenes the Act can be liable to a fine of up to 120 penalty units or imprisonment for up to two years, or both. The exact penalties would depend on the nature and severity of the breach.