EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0826920
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.
Radio Frequency Services Pty Ltd applied for a TCO in respect of certain steel plate on 18 August 2008.
Instrument
TCO No 0826920 was made on 07 November 2008. It declares that those certain steel plate 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. 0826920 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 Customs Act 1901 was amended to introduce a scheme for Tariff Concession Orders (TCOs), which allow for a lower rate of customs duty on certain goods. Enacted by the Parliament of Australia, this legislation aimed to address the need for tariff concessions to support Australian industries by providing relief from customs duties on specific goods, provided that no substitutable goods were produced in Australia at the time of the application. The Explanatory Statement for Tariff Concession Instrument No. 0826920, made under this Act, clarifies the process for applying for and granting a TCO, including the requirement for the Chief Executive Officer of Customs to be satisfied that the application meets the core criteria, such as the absence of substitutable goods produced in Australia. The policy objective is to facilitate the import of goods that are not domestically produced, thereby supporting industries and potentially lowering costs for consumers and businesses.
Scope and Application
The Customs Act 1901, through Part XVA, provides a framework for the application of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This Act applies to any individual or entity seeking a tariff concession for specific goods imported into Australia. The process involves an application to the CEO, who assesses whether the goods in question meet the core criteria, including the absence of substitutable goods produced in Australia in the ordinary course of business. If the CEO determines that these criteria are satisfied, a TCO is issued, thereby applying a lower rate of customs duty on the specified goods. The Act’s geographic reach is national, as it pertains to the importation of goods into Australia, and it includes a mechanism for public consultation before the issuance of a TCO. The Act also specifies that TCOs do not retroactively affect the rights of any person, ensuring that they only apply to transactions occurring from the date the TCO is taken to have come into force. Additionally, the application and scope of TCOs may be further detailed through subordinate instruments, which can provide specific rules and regulations that complement the primary legislation.
Key Provisions
The Tariff Concession Instrument No. 0826920, made under the Customs Act 1901 (the Act), establishes specific provisions concerning the application and effects of Tariff Concession Orders (TCOs) (section 269C). This legislation facilitates the granting of TCOs by the Chief Executive Officer of Customs (the CEO) to reduce customs duties on certain goods. To be eligible for a TCO, an applicant must ensure that the goods in question are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO (section 269F). The core criteria for approval, as outlined in section 269C, require that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged.
The obligations imposed by this Act on the parties involved include the requirement for the CEO to carefully evaluate each TCO application to ascertain whether it meets the core criteria (section 269F). If satisfied, the CEO must proceed to make a written order, known as a TCO, specifying the applicable customs duty rate for the goods (section 269P(3)). Additionally, the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application, inviting any interested parties to submit their views on whether the TCO should be granted (subsection 269K(1)). In the case of TCO No. 0826920, the CEO received no submissions opposing the order.
Failure to comply with the requirements set forth in the Customs Act 1901 can lead to various legal consequences. The Act does not explicitly detail specific offences, penalties, or consequences for breach within the provided text. However, general provisions under the Act and associated regulations may impose penalties for non-compliance, which could include fines or other legal actions. It is essential for applicants and the CEO to adhere to the statutory requirements to avoid potential legal repercussions. The TCO itself does not disadvantage any person or impose new liabilities on anyone other than the Commonwealth, ensuring that the rights of importers are beneficially affected (subsection 269S(1)).