EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0819443
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.
Sun Metals Corporation applied for a TCO in respect of certain zinc slab ingot casting machine lines on 17 July 2008.
Instrument
TCO No 0819443 was made on 10 October 2008. It declares that those certain zinc slab ingot casting machine lines 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. 0819443 is taken to have come into force on 17 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. 0819443 under the Customs Act 1901 was enacted to provide a concession on customs duty for certain zinc slab ingot casting machine lines, reducing the general duty rate from 5% to free. The Tariff Concession Orders scheme, established under Part XVA of the Customs Act 1901, allows the Chief Executive Officer of Customs to grant these concessions when specific criteria are met, namely, when no substitutable goods are produced in Australia. The policy objective is to support Australian industries by ensuring that certain goods can be imported at a lower duty rate if they are not domestically produced. This instrument was introduced following an application by Sun Metals Corporation on 17 July 2008, and the concession became effective on the same date, with no negative impact on existing rights or liabilities.
Scope and Application
The Customs Act 1901 provides a framework for the imposition of customs duties and the granting of tariff concessions through Tariff Concession Orders (TCOs). Specifically, Part XVA of the Act allows the Chief Executive Officer of Customs (CEO) to issue TCOs that lower the rate of customs duty for certain goods if specific criteria are met. This legislation applies to entities or individuals seeking to import goods that are not produced in Australia and that do not have substitutable goods produced domestically. The application process involves submitting an application to the CEO, who must determine whether the goods meet the core criteria, such as the absence of substitutable goods in Australia. If the CEO is satisfied that these criteria are met, a TCO is issued, providing a tariff concession, as evidenced by TCO No. 0819443 for zinc slab ingot casting machine lines. This instrument was made on 10 October 2008, and it came into force on 17 July 2008, the date the application was lodged. The geographic reach of this legislation is national, as it pertains to the Customs Act, which applies across Australia. The TCO does not disadvantage any person by affecting their rights as at the date of registration, nor does it impose liabilities for actions taken before the TCO's effective date.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0819443 (referred to as TCO No 0819443) under the Customs Act 1901 (section 269F) permit the Chief Executive Officer (CEO) of Customs to make an order for tariff concessions on certain goods. This specific instrument, made on 10 October 2008, applies to certain zinc slab ingot casting machine lines, declaring them to be subject to the prescribed tariff as outlined in item 50 of Schedule 4 to the Customs Tariff Act 1995. The tariff concession reduces the duty on these goods from the general rate of 5% to zero. This is contingent on the CEO being satisfied that no substitutable goods are produced in Australia, as per section 269C of the Customs Act 1901. The instrument effectively came into force on 17 July 2008, the date the application was lodged, as per section 269S(1) of the Customs Act 1901.
The obligations imposed by the Act on the parties it governs include the requirement for the CEO to make a decision on whether the application for a tariff concession meets the core criteria, as stipulated in section 269C. If the CEO is satisfied that the application meets these criteria, they must make a written order declaring the goods to which the concession applies, as per section 269P(3). Additionally, the CEO is required to publish a notice in the Gazette, inviting submissions from any person who may have reasons why the tariff concession should not be made, as per subsection 269K(1). The CEO's decision must be based on the absence of substitutable goods produced in Australia, as defined by sections 269D, 269E, and 269F of the Customs Act 1901.
Failure to comply with the requirements of the Customs Act 1901 and the conditions set out in the tariff concession instrument could result in legal consequences. While specific offences and penalties are not detailed within the text, breaches of the Act could lead to civil or criminal penalties, depending on the nature and severity of the breach. The maximum penalties for breaches of customs-related legislation can vary significantly, but generally, they can include fines, imprisonment, or both, depending on the specific breach and the jurisdiction's laws. The Act ensures that the rights of the Commonwealth are protected, and any person other than the Commonwealth will not be disadvantaged or have liabilities imposed on them in respect of actions taken before the tariff concession order was registered.