EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0829724
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.
Downer Edi Works Pty Ltd applied for a TCO in respect of certain dust collection module asphalt plant on 05 September 2008.
Instrument
TCO No 0829724 was made on 28 November 2008. It declares that those certain dust collection module asphalt 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. 0829724 is taken to have come into force on 05 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, enacted by the Australian Parliament, provides a framework for the imposition of customs duties on imported goods. Among its provisions, Part XVA specifically addresses the issuance of Tariff Concession Orders (TCOs), which allow for reduced customs duties on certain goods. This legislative scheme was designed to address the problem of ensuring that Australian businesses and industries have access to competitively priced goods that are not produced domestically, thus fostering economic efficiency and international competitiveness. In line with the policy objective of promoting economic benefits and supporting industry growth, Tariff Concession Instrument No. 0829724 was introduced. This instrument, issued by the Chief Executive Officer of Customs, granted a tariff concession for certain dust collection module asphalt plants, effective from the date of the application on 5 September 2008. This concession resulted in the elimination of the 5% customs duty on these goods, thereby benefiting importers by potentially reducing their costs and enhancing their competitiveness in the market.
Scope and Application
The Customs Act 1901 applies to a broad range of goods and entities involved in international trade within Australia. Specifically, the Act allows for the implementation of Tariff Concession Orders (TCOs) which reduce customs duty on certain goods, provided that these goods are not substitutes for products already manufactured in Australia and meet other specified criteria. The application process for a TCO involves an assessment by the Chief Executive Officer of Customs, who must determine if the application adheres to the core criteria outlined in the Act. If the criteria are met, a TCO is issued, effectively granting tariff concessions on the specified goods. This process is particularly relevant for businesses and individuals involved in the import of these goods, as it directly impacts the cost of importing and the availability of certain products in the Australian market. The Act's application is national in scope, affecting all states and territories within Australia. However, certain goods are excluded from TCOs, as specified in section 269SJ of the Act, which lists goods that cannot be subject to tariff concessions. The application of the Act can also be extended or refined through subordinate instruments, ensuring that it remains relevant and effective in a changing economic environment.
Key Provisions
The key operative sections of the Tariff Concession Order No. 0829724 under the Customs Act 1901 (the Act) include sections 269C, 269B, 269E, 269P(3), and 269SJ. These sections provide the criteria and process for the Chief Executive Officer of Customs (the CEO) to consider and decide on an application for a Tariff Concession Order (TCO). Section 269C sets out the core criteria for the CEO to determine if a TCO can be granted, specifically focusing on whether no substitutable goods were produced in Australia at the time the application was lodged. Section 269B defines essential terms such as "goods produced in Australia," "ordinary course of business," and "substitutable goods." Section 269P(3) mandates that if the CEO is satisfied with the application, a written TCO must be made, and section 269SJ lists goods that cannot be subject to a TCO.
The Act imposes several obligations and requirements on the parties and entities it governs. Firstly, applicants such as Downer Edi Works Pty Ltd must ensure their applications meet the core criteria specified in section 269C. They must provide sufficient evidence that no substitutable goods were produced in Australia in the ordinary course of business on the date the application was lodged. The CEO must then publish a notice in the Gazette inviting submissions from any interested parties, as required by section 269K(1). The CEO must also decide on the application in a timely manner and, if satisfied, make a written TCO under section 269P(3). Importers, once the TCO is in effect, can apply for a refund of duty on goods imported since the date the TCO was lodged, as per paragraph 126(1)(r) of the Regulations.
Breaches of the requirements set out in the Act can result in various offences, penalties, or civil and criminal consequences. While the explanatory statement does not detail specific offences or penalties for non-compliance with TCO provisions, it is generally understood that failure to adhere to the stipulated criteria or obligations may lead to legal repercussions. For instance, providing false information in an application could result in civil penalties, and more severe breaches might lead to criminal charges. The maximum penalties would depend on the specific nature and severity of the breach, aligning with general provisions of the Customs Act 1901 and related legislation.