EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0823710
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.
Dowding Reynard & Associates Pacific Pty Ltd applied for a TCO in respect of certain cyclone dense media separation plant on 30 July 2008.
Instrument
TCO No 0823710 was made on 24 October 2008. It declares that those certain cyclone dense media separation plant 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. 0823710 is taken to have come into force on 30 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 Parliament of Australia, introduces a scheme that allows for Tariff Concession Orders (TCOs) to be issued by the Chief Executive Officer of Customs (CEO). The primary purpose of this legislation is to provide a mechanism through which lower rates of customs duty can be applied to specific goods, provided they meet certain criteria. Specifically, the Customs Act allows for a TCO if the CEO determines that no substitutable goods are produced in Australia in the ordinary course of business. This concession aims to encourage the import of goods that are not domestically manufactured, potentially fostering economic growth and competition. Dowding Reynard & Associates Pacific Pty Ltd successfully applied for a TCO concerning certain cyclone dense media separation plants, resulting in a tariff concession that lowered the duty rate from 5% to free. The instrument, TCO No. 0823710, came into force on the date of the application, 30 July 2008, and no submissions were received in opposition to the concession.
Scope and Application
The Customs Act 1901, specifically Part XVA, governs the application and issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This legislation applies to individuals or entities seeking to import specific goods into Australia and is subject to the condition that no substitutable goods are produced in Australia in the ordinary course of business. The instrument in question, Tariff Concession Instrument No. 0823710, pertains to a particular cyclone dense media separation plant applied for by Dowding Reynard & Associates Pacific Pty Ltd on 30 July 2008. Once the CEO was satisfied that the application met the core criteria, a TCO was issued on 24 October 2008, granting a zero rate of duty on the specified goods, effectively reducing the general rate from 5% to free. The TCO came into effect on the date of application, 30 July 2008, and does not affect the rights of any person except to beneficially impact importers by allowing them to apply for duty refunds on goods imported since the TCO's effective date.
Key Provisions
The Customs Act 1901, through its Part XVA, establishes a framework for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer (CEO) of Customs, as outlined in section 269F. An applicant can request a TCO for specific goods, which would result in a lower rate of customs duty for these goods if the CEO determines that the application meets the core criteria (section 269C). This determination hinges on whether there were any substitutable goods produced in Australia at the time the application was lodged, as defined by sections 269D, 269E, and 269F of the Act.
To comply with the Act, the CEO must ensure that the application is not for goods specified in section 269SJ, which are ineligible for a TCO. If the CEO is satisfied that the application is valid and meets the core criteria, they must issue a written order, as stipulated in section 269P(3). The CEO must also publish a notice in the Gazette inviting submissions from any interested parties who might oppose the TCO, as per subsection 269K(1). In the case of TCO No. 0823710, no submissions were received, allowing the CEO to proceed with the order.
Under the Customs Act 1901, any breach of the provisions governing TCOs could lead to civil or criminal consequences. However, the explanatory statement does not specify particular offences or penalties related to the TCO process itself. The focus of the Act is on ensuring that the TCO process is transparent and fair, with the primary consequence of non-compliance being the potential disallowance of the TCO. The rights of existing parties are protected under the Act, ensuring that no person, other than the Commonwealth, will be disadvantaged or imposed with liabilities due to the issuance of a TCO.
The Act also outlines that the TCO will come into force on the date the application was lodged, as per subsection 269S(1). This means that for TCO No. 0823710, the concessional rate of duty applies from 30 July 2008. The rights of importers are positively affected, allowing them to apply for a refund of duty on goods imported since the effective date of the TCO, as stated in paragraph 126(1)(r) of the Regulations. Importantly, the TCO does not impose any new liabilities on any person, thereby maintaining a balance between regulatory compliance and the protection of individual rights.