EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0827187
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 Ltd applied for a TCO in respect of certain steel structure parts on 19 August 2008.
Instrument
TCO No 0827187 was made on 07 November 2008. It declares that those certain steel structure parts 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. 0827187
is taken to have come into force on 19 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 Parliament of Australia, establishes a framework under which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs. These orders allow for a reduced rate of customs duty on specified goods, provided certain conditions are met. The primary objective of this legislative framework is to facilitate the import of goods that are not produced domestically in a way that corresponds to their intended use, thereby supporting trade and economic efficiency. In this context, Tariff Concession Instrument No. 0827187 was introduced to address the need for tariff concessions on certain steel structure parts imported by Origin Energy Power Pty Ltd, ensuring these goods benefit from a lower customs duty rate and aligning with the broader policy goal of fostering competitive and efficient markets.
Scope and Application
The Tariff Concession Instrument No. 0827187 is an instrument under the Customs Act 1901, which pertains specifically to the scheme of Tariff Concession Orders (TCOs) established in Part XVA of the Act. This instrument applies to any entity or individual who seeks tariff concessions for certain goods imported into Australia, with the specific instance here involving Origin Energy Power Pty Ltd’s application for certain steel structure parts. The application was processed and approved by the Chief Executive Officer of Customs (CEO), who determined that no substitutable goods were produced in Australia, thereby meeting the core criteria outlined in section 269C of the Act. The geographic scope of the Act is national, as it concerns the importation of goods into Australia and the application of customs duties. The Act does not specify exclusions, exemptions, or thresholds for eligibility of goods for a TCO, other than those explicitly stated in section 269SJ. The instrument does not disadvantage any person other than the Commonwealth and imposes no liabilities on persons other than the Commonwealth in relation to actions taken before the instrument’s registration. The instrument came into force on 19 August 2008, the date the application was lodged, as per subsection 269S(1) of the Act.
Key Provisions
The Tariff Concession Order No. 0827187 (section 269P) under the Customs Act 1901 applies to certain steel structure parts, reducing the duty from 5% to free. This concession is granted upon the application of Origin Energy Power Pty Ltd, provided the Chief Executive Officer of Customs (CEO) is satisfied that no substitutable goods are produced in Australia (section 269C). The CEO must make a written order declaring these parts to be subject to a prescribed item in Schedule 4 of the Customs Tariff Act 1995. The order is considered to have come into force on the day the application was lodged, which was 19 August 2008 (subsection 269S(1)).
The Act imposes obligations on the CEO to ensure that the application meets the core criteria, including verifying that no substitutable goods are produced in Australia on the day the application is lodged (section 269C). The CEO must also publish a notice in the Gazette inviting any interested parties to submit objections to the TCO, though in this case, no submissions were received (subsection 269K(1)). Furthermore, the TCO does not affect any existing rights of individuals other than the Commonwealth and does not impose any liabilities on persons other than the Commonwealth in respect of actions taken before the registration date of the TCO.
Breaches of the provisions under the Customs Act 1901, including the making of false statements or omissions in an application for a Tariff Concession Order, may lead to criminal and civil consequences. Section 281 of the Act provides that any person who contravenes an offence provision commits an offence. The penalties can include fines and imprisonment. Specifically, under section 281(1), a person can be fined up to 120 penalty units or imprisoned for up to 12 months, or both, for each offence. These penalties reflect the seriousness of non-compliance and aim to deter fraudulent activities within the customs duty framework.