EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0816639
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.
Industrial Galvanizers Corporation Pty Ltd applied for a TCO in respect of certain acid or flux pickling tanks on 08 July 2008.
Instrument
TCO No 0816639 was made on 26 September 2008. It declares that those certain acid or flux pickling tanks 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. 0816639 is taken to have come into force on 08 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 Customs Act 1901, enacted by the Australian Parliament, provides a framework for the regulation of customs and excise in Australia, including the imposition and remission of duties and taxes. The Act was introduced to address the need for a comprehensive and effective system to control the import and export of goods, ensuring the collection of necessary revenue and the protection of domestic industries. One of the mechanisms under this Act is the provision for Tariff Concession Orders (TCOs), which allow for the reduction or exemption of customs duty on certain goods, provided specific criteria are met. The instrument F2008L04083, titled Tariff Concession Instrument No. 0816639, was introduced to provide tariff concessions for certain acid or flux pickling tanks, thereby allowing for the importation of these goods at a reduced duty rate. This instrument was created to ensure that these goods are accessible to Australian industries without imposing a prohibitive tariff burden, aligning with the policy objective of facilitating trade while protecting domestic production where necessary.
Scope and Application
The Customs Act 1901 applies to individuals and entities seeking to import goods into Australia, particularly those who may apply for Tariff Concession Orders (TCOs) to benefit from reduced customs duty rates. The Act provides a mechanism whereby the Chief Executive Officer of Customs can grant tariff concessions under specific conditions, as outlined in Part XVA of the Act. The application of a TCO is contingent on the goods not having substitutable equivalents produced in Australia, and the process requires public consultation as mandated by the Act. The geographic reach of the Act is national, affecting all imports across Australia, and its provisions are enforced consistently regardless of state or territory boundaries. The Act does not apply to goods specified in section 269SJ, which cannot be subject to a TCO, and it does not impose liabilities on persons other than the Commonwealth for actions taken prior to the TCO's effective date. The application and scope of the Act may be extended or restricted through subordinate instruments, allowing for further specificity and adaptation to particular circumstances.
Key Provisions
The Customs Act 1901, particularly Part XVA, outlines a scheme whereby Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs (section 269F). These orders provide a lower rate of customs duty for goods specified in them. An applicant can apply to the CEO for a TCO in respect of goods, provided these goods are not listed in section 269SJ, which specifies goods ineligible for TCOs. The CEO must determine whether the application meets the core criteria (section 269C) and, if satisfied, issue a written TCO (section 269P(3)).
The obligations under this Act include ensuring that no substitutable goods are produced in Australia on the day the application is lodged. The definitions of "goods produced in Australia," "ordinary course of business," and "substitutable goods" are given by sections 269D, 269E, and 269F respectively. The CEO has a duty to publish a notice in the Gazette (subsection 269K(1)) inviting submissions from any interested parties, although in this case, no submissions were received.
The TCO No. 0816639, made on 26 September 2008, pertains to certain acid or flux pickling tanks and specifies that these goods are subject to item 50 of Schedule 4 of the Customs Tariff Act 1995. This TCO was issued because the CEO was satisfied that no substitutable goods were produced in Australia on the date of the application. Consequently, the general rate of duty of 5% was reduced to free for these goods. The TCO came into force on 8 July 2008, the date the application was lodged (subsection 269S(1)). Importantly, the TCO does not affect any rights or impose any liabilities on individuals or entities other than the Commonwealth in respect of actions taken before the TCO's registration date.
Breaching the provisions of the Customs Act 1901 or the terms of a TCO may lead to various civil or criminal consequences. While the specific offences, penalties, and consequences are not detailed in the explanatory statement, breaches of customs regulations generally can result in fines and, in more severe cases, criminal charges. The Act empowers the CEO to enforce compliance, and non-compliance may lead to penalties as prescribed by law. The specific penalties would depend on the nature and severity of the breach, with the potential for significant fines and, in criminal cases, imprisonment.