EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0824233
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.
Applied Biosystems Pty Ltd applied for a TCO in respect of certain magnetic particle processor on 31 July 2008.
Instrument
TCO No 0824233 was made on 24 October 2008. It declares that those certain magnetic particle processor 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. 0824233 is taken to have come into force on 31 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. 0824233, enacted under the Customs Act 1901, addresses the need to provide tariff concessions for specific goods, thereby reducing the customs duty burden on certain imported items. This instrument was introduced to facilitate easier access to essential goods by lowering their duty rates, aligning with the policy objectives of promoting economic efficiency and competitiveness. The instrument was made by the Chief Executive Officer of Customs and came into effect on 31 July 2008, the date the application for the tariff concession was lodged. The application by Applied Biosystems Pty Ltd for a tariff concession on certain magnetic particle processors was approved as no substitutable goods were being produced in Australia at the time, satisfying the core criteria set out in the Act. The instrument ensures that the rights of importers are protected and can benefit from a refund of duties on the specified goods imported since the effective date of the concession.
Scope and Application
The Tariff Concession Instrument No. 0824233 under the Customs Act 1901 applies to certain magnetic particle processors, which have been granted a tariff concession order (TCO) by the Chief Executive Officer of Customs (CEO). This concession reduces the rate of customs duty applicable to these goods from the general rate of 5% to free. The TCO is issued under section 269F of the Act, whereby an application is made by a person for a concession in customs duty on specified goods. The CEO is required to consider the application against the core criteria, which include whether the goods are not produced in Australia in the ordinary course of business and do not have substitutable goods. The instrument applies nationally, and the concession is effective from the date the application was lodged, as outlined in subsection 269S(1) of the Act. The rights of existing and future importers are beneficially affected, with the ability to apply for a refund of duty under the Customs Act 1967 Regulations. Importantly, the TCO does not impose any new liabilities on any person and does not disadvantage anyone by affecting their rights as at the date of registration. The application process includes a consultation period where any interested parties can lodge submissions, although in this case, no submissions were received.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0824233 are sections 269F, 269C, and 269P of the Customs Act 1901. Section 269F allows for an application to be made to the Chief Executive Officer of Customs (the CEO) for a Tariff Concession Order (TCO) in respect of goods. If the application is not in relation to goods specified in section 269SJ, which excludes certain types of goods from the scheme, the CEO must then determine if the application meets the core criteria (section 269C). If the application meets these criteria, the CEO must issue a written TCO (section 269P). In this specific case, the TCO No. 0824233 was made for certain magnetic particle processors, applying item 50 of Schedule 4 to the Customs Tariff Act 1995, resulting in a duty-free rate for these goods.
The Customs Act 1901 imposes several obligations on the parties involved in the TCO process. The CEO is required to assess whether an application for a TCO meets the core criteria, which involves determining whether no substitutable goods were produced in Australia on the day the application was lodged. The CEO must also publish a notice in the Gazette inviting submissions from any person who may have reasons to oppose the TCO. In this instance, no submissions were received, facilitating the approval of TCO No. 0824233. Additionally, the Act mandates that the TCO does not affect the rights of any person, except the Commonwealth, as at the date of registration, ensuring that no one is disadvantaged or imposed with new liabilities due to the TCO.
In terms of consequences for breach, the Customs Act 1901 does not explicitly detail offences, penalties, or specific civil or criminal consequences for non-compliance with the provisions related to TCOs. However, the general provisions of the Act and associated regulations may apply to breaches, which could include administrative penalties or legal actions under the broader customs framework. It is important to note that while specific penalties for TCO-related breaches are not outlined, the Act's overarching framework ensures that any failure to comply with customs regulations could lead to legal repercussions, including fines or other penalties as prescribed by relevant legislation.