EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0826878
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.
Origin Energy Power Pty Ptd applied for a TCO in respect of certain gas turbine generator inlet support structure on 18 August 2008.
Instrument
TCO No 0826878 was made on 07 November 2008. It declares that those certain gas turbine generator inlet support structure 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. 0826878
is taken to have come into force on 18 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 Tariff Concession Instrument No. 0826878, enacted under the Customs Act 1901, addresses the need for tariff concessions for specific goods imported into Australia, thereby reducing the customs duty payable on those goods. The Instrument was introduced to facilitate the import of certain gas turbine generator inlet support structures by applying a zero duty rate, as opposed to the general 5% duty rate, thereby providing a concession to the applicant, Origin Energy Power Pty Ptd. The instrument was enacted by the Chief Executive Officer of Customs, following an application by the applicant and after satisfying the core criteria outlined in the Act, particularly that no substitutable goods were produced in Australia at the time of application. This legislative instrument aims to promote the efficient importation of goods that are essential for specific industrial uses, without disadvantaging existing rights or imposing new liabilities on any person.
Scope and Application
The Customs Act 1901, through its Part XVA, facilitates the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. These orders apply to specific goods for which a lower rate of customs duty is stipulated, provided the goods meet certain criteria and are not excluded under section 269SJ of the Act. The Act applies to individuals or entities seeking a TCO for particular goods, ensuring no substitutable goods are produced in Australia in the ordinary course of business. The geographic reach of this Act is national, governing the customs duty rates across all states and territories of Australia. TCO No. 0826878, made on 7 November 2008, exemplifies the application of this legislation by granting a free duty rate for certain gas turbine generator inlet support structures, effective from 18 August 2008, the date the application was lodged. This order does not impose any liabilities on persons other than the Commonwealth and allows importers to apply for a refund of duties paid on these goods since the commencement date of the order.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0826878 (TCO No 0826878) under the Customs Act 1901 (the Act) are sections 269C, 269P, and 269S. Section 269C outlines the core criteria that must be met for a Tariff Concession Order (TCO) to be issued, which includes the absence of substitutable goods being produced in Australia at the time of the application. Section 269P(3) mandates the Chief Executive Officer of Customs (the CEO) to make a written order if these criteria are satisfied. Finally, section 269S specifies that the TCO comes into force on the day the application is lodged, which in this case was 18 August 2008.
Under this legislation, any person wishing to apply for a TCO must ensure that no substitutable goods are produced in Australia at the time of the application. This requirement is outlined in section 269C of the Act, which defines key terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods'. The CEO must also publish a notice in the Gazette inviting submissions from interested parties, as per section 269K(1). However, in this instance, no submissions were received, indicating that the application met the necessary conditions without opposition.
The obligations imposed on parties governed by this Act include ensuring compliance with the core criteria for a TCO application and the timely publication of notices in the Gazette to allow for public submissions. The CEO is required to assess the application based on these criteria and, if satisfied, to issue a TCO. Additionally, the Act mandates that the rights of importers will be beneficially affected, allowing them to apply for a refund of duty on goods imported since the TCO came into force.
For breach of any of the conditions outlined in the Act, there are potential civil or criminal consequences, although the specific offences and penalties are not detailed in the provided text. Typically, under the Customs Act 1901, breaches can lead to penalties such as fines or imprisonment, depending on the severity and intent of the breach. However, the maximum penalties are not specified in the explanatory statement, and further reference to the Act or related regulations would be necessary for precise details.