EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0815570
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.
Tru Energy Gas Storage Pty Ltd applied for a TCO in respect of certain double block and bleed valve assemblies on 02 July 2008.
Instrument
TCO No 0815570 was made on 26 September 2008. It declares that those certain double block and bleed valve assemblies 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. 0815570 is taken to have come into force on 02 July 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. 0815570 was enacted in 2008 as part of the Customs Act 1901. This legislation was introduced to address the need for a streamlined process to provide tariff concessions on specific goods, thereby facilitating trade and reducing costs for businesses that import these goods. The instrument was created under the authority granted by the Customs Act 1901, with the objective of ensuring that the application process for tariff concessions is both efficient and fair. The Chief Executive Officer of Customs is empowered to make such tariff concession orders, provided that the application meets the core criteria specified in the Act, and after considering any relevant submissions from the public. This process ensures that the interests of both the Commonwealth and the importing businesses are balanced appropriately.
Scope and Application
The Tariff Concession Instrument No. 0815570, made under section 269F of the Customs Act 1901, applies to any individual or entity seeking to import certain double block and bleed valve assemblies into Australia, thereby granting them tariff concessions on these goods. The application of the Act is Commonwealth-wide, encompassing all territories and states within Australia. This specific instrument was created to address a request from Tru Energy Gas Storage Pty Ltd, who applied for a tariff concession order on 2 July 2008, and was subsequently granted on 26 September 2008. The instrument reduces the duty rate from the general 5% to free, applicable to the goods specified in item 50 of Schedule 4 to the Customs Tariff Act 1995. The instrument does not apply to any goods that are specified in section 269SJ of the Customs Act 1901, which are ineligible for tariff concessions. The CEO of Customs is required to consult with the public by publishing notices in the Gazette, inviting submissions on the proposed concession; however, in this case, no submissions were received. The tariff concession order came into effect on the day the application was lodged, 2 July 2008, and does not affect any pre-existing rights or impose liabilities on anyone except the Commonwealth.
Key Provisions
The main operative sections of the Customs Act 1901, as referenced in the Tariff Concession Instrument No. 0815570, provide a framework for the application and issuance of Tariff Concession Orders (TCOs). Specifically, section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. The CEO must then determine if the application meets the core criteria outlined in section 269C. If the CEO is satisfied that the application meets these criteria, they are required under section 269P(3) to make a written TCO. In this case, Tru Energy Gas Storage Pty Ltd applied for a TCO concerning certain double block and bleed valve assemblies on 02 July 2008. The CEO subsequently issued TCO No. 0815570 on 26 September 2008, declaring that the specified goods would be subject to a reduced rate of customs duty, now free instead of the general rate of 5%.
The Act imposes certain obligations on the parties involved. Firstly, the CEO must ensure that any application for a TCO is not in respect of goods specified in section 269SJ, which lists goods ineligible for TCOs. Once an application is accepted as valid, the CEO must publish a notice in the Gazette, inviting any interested parties to lodge submissions if they believe the TCO should not be made, as required by subsection 269K(1). Additionally, the CEO must confirm that no substitutable goods are being produced in Australia at the time of the application, in accordance with section 269C. In this instance, no submissions were received in response to the published notice, and the CEO found that no substitutable goods were produced in Australia.
Breach of the conditions or requirements set out in the Customs Act 1901 can lead to various civil or criminal consequences. While the explanatory statement does not detail specific offences under this Act, it is known that violations of customs laws can result in significant penalties. For instance, under section 243 of the Customs Act, penalties can include fines of up to $22,200 for individuals and $111,000 for corporations, as well as imprisonment for up to two years. The severity of penalties can vary depending on the nature and extent of the breach, with more serious or repeated violations potentially leading to higher fines and longer imprisonment terms. The Act also provides for additional civil penalties for non-compliance with customs regulations, further emphasising the importance of adhering to the established requirements.