EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0825494
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.
Citic Pacific Mining Management Pty Ltd applied for a TCO in respect of certain dewatering plant on 07 August 2008.
Instrument
TCO No 0825494 was made on 24 October 2008. It declares that those certain dewatering 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. 0825494 is taken to have come into force on 07 August 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, establishes a framework for the administration of customs and excise duties. This Act includes provisions for the creation of Tariff Concession Orders (TCOs) under Part XVA, which allow for reduced customs duties on specific goods if certain criteria are met. The problem or gap addressed by this legislation is to provide relief on customs duties for goods that cannot be substituted by Australian-produced alternatives, thereby encouraging investment and the importation of specialised equipment necessary for particular industries. Tariff Concession Instrument No. 0825494 was made under this Act, specifically concerning an application by Citic Pacific Mining Management Pty Ltd for tariff concessions on certain dewatering plant. This instrument was designed to ensure that no substitutable goods were produced in Australia, thus satisfying the core criteria for a TCO. The instrument was published in the Gazette, and no submissions opposing the TCO were received, leading to its implementation from the date of the application, 7 August 2008.
Scope and Application
The Tariff Concession Instrument No. 0825494 under the Customs Act 1901 applies specifically to the application submitted by Citic Pacific Mining Management Pty Ltd concerning certain dewatering plant, effective from 7 August 2008. The act facilitates the reduction of customs duties on goods that are deemed not to have substitutable goods produced in Australia, thereby meeting the core criteria as outlined in section 269C of the Act. The application process involves scrutiny by the Chief Executive Officer of Customs to ensure that the goods in question do not fall under the exceptions listed in section 269SJ. Once the CEO determines that the application meets the necessary criteria, a Tariff Concession Order is issued, effectively granting a concession on the customs duty for the specified goods. The instrument ensures that the rights of entities other than the Commonwealth are not adversely affected by the concession, and it allows for the potential refund of duties paid on imports of the specified goods since the effective date of the concession.
Key Provisions
The Tariff Concession Instrument No. 0825494 under the Customs Act 1901 (sections 269C, 269F, 269K, 269P, 269S, and 269SJ) provides for the concession of customs duty on certain dewatering plant. This instrument is applicable to goods specified in the application made by Citic Pacific Mining Management Pty Ltd on 7 August 2008, which the Chief Executive Officer of Customs (CEO) accepted, finding that no substitutable goods were produced in Australia on that date. Consequently, the CEO issued Tariff Concession Order (TCO) No. 0825494 on 24 October 2008, declaring that these dewatering plant are subject to a duty-free status under item 50 of Schedule 4 to the Customs Tariff Act 1995.
The obligations imposed on the parties by this Act are primarily centred on the application process and the criteria that the CEO must satisfy before issuing a TCO. The applicant must ensure that the goods in question do not have substitutable alternatives produced in Australia, as outlined in section 269C of the Act. The CEO, upon receiving a valid application, must then determine if the application meets the core criteria and, if so, issue the TCO (section 269P). Additionally, the CEO is mandated to publish a notice in the Gazette (section 269K), inviting public submissions on the application, although no submissions were received in this case. The Act also ensures that the TCO does not retroactively affect the rights or impose liabilities on any person other than the Commonwealth (section 269S).
The Customs Act 1901 does not explicitly state offences, penalties, or civil/criminal consequences for breaches related to TCOs. However, it is implicit that any misuse or fraudulent application for a TCO could be subject to the general penalties for fraud under the Customs Act, which may include fines or imprisonment, depending on the severity of the offence. Moreover, any misdeclaration or fraudulent claim for a tariff concession could also result in penalties under the Crimes Act 1914, including fines and imprisonment. The specific penalties would depend on the particular circumstances of the breach and the discretion of the court.