EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0829428
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.
Rio Tinto Aluminium Limited applied for a TCO in respect of certain pipe fittings on 04 September 2008.
Instrument
TCO No 0829428 was made on 28 November 2008. It declares that those certain pipe fittings 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. 0829428 is taken to have come into force on 04 September 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 enacted to provide a regulatory framework for customs duties and related matters in Australia, and it was introduced to address the need for efficient and fair administration of customs duties. Part XVA of the Act allows the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs), which reduce the customs duty payable on specific goods. F2009L00349, also known as Tariff Concession Instrument No. 0829428, was made under this provision to provide tariff concessions on certain pipe fittings. This instrument was introduced to benefit importers by providing a lower rate of customs duty, and it was enacted by the relevant authority in accordance with the Customs Act 1901. The policy objective of this instrument is to provide tariff concessions for goods that are not substitutable by Australian-made products, thereby promoting fair competition and supporting the importation of goods that are not produced domestically.
Scope and Application
The Customs Act 1901, through its Tariff Concession Orders (TCOs) scheme, applies to individuals and entities seeking to import goods that qualify for reduced customs duty rates. The Act specifically targets the Chief Executive Officer of Customs, who is responsible for evaluating applications for TCOs and deciding whether they meet the core criteria set out in the Act. These criteria include ensuring that no substitutable goods are produced in Australia at the time the application is lodged. The geographic reach of this legislation is national, applying across all states and territories of Australia, and its application is not limited by any specific industry. However, certain goods specified in section 269SJ of the Act are excluded from the TCO scheme, such as those that are sensitive or critical to national security. The application process for TCOs involves public consultation, where the CEO invites submissions from interested parties, although no submissions were received for TCO No. 0829428. The commencement of a TCO is effective from the date the application is lodged, with the rights of importers potentially benefiting from duty refunds on goods imported since the TCO's effective date. The Act does not impose any new liabilities on persons other than the Commonwealth.
Key Provisions
The main operative sections of this legislation, particularly sections 269C, 269B, 269P, and 269S, outline the process for applying for a Tariff Concession Order (TCO) under the Customs Act 1901. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. The CEO must then determine whether the application meets the core criteria, which are specified in section 269C. This involves verifying that no substitutable goods are produced in Australia at the time the application is lodged, as defined by section 269B. If the CEO is satisfied that the application meets these criteria, they must make a written order (a TCO), as required by section 269P(3), declaring that the goods specified in the application are subject to a prescribed item in Schedule 4 of the Customs Tariff Act 1995. This particular TCO, No. 0829428, was made on 28 November 2008 for certain pipe fittings, which are now subject to a zero rate of duty instead of the general 5% duty rate.
The obligations imposed on the parties governed by this Act include the requirement for applicants to ensure their applications are made in good faith and meet the criteria set out in the Act. The CEO has the duty to review applications promptly and publish notices in the Gazette inviting submissions from interested parties. This process ensures transparency and allows for any objections to be considered before a TCO is made. Additionally, the CEO must consider whether the goods specified in the TCO application are substitutable by goods produced in Australia, adhering to the definitions and criteria specified in the Act. Importers, in turn, have the obligation to ensure they are aware of the TCO and can apply for refunds of duties paid on goods imported after the TCO's effective date.
The Act does not explicitly detail specific offences, penalties, or consequences for breaches of the TCO provisions. However, it is reasonable to infer that any failure to comply with the requirements of the Customs Act 1901, including the submission of false information in a TCO application or the misuse of a TCO, could result in civil or criminal penalties under the broader provisions of the Customs Act. These may include fines or imprisonment, depending on the severity and intent of the breach. The specific penalties would be determined in accordance with the general legal framework governing the administration and enforcement of the Customs Act.