EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0829844
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.
Primo Smallgoods Pty Ltd applied for a TCO in respect of certain pig slaughter and processing line on 05 September 2008.
Instrument
TCO No 0829844 was made on 28 November 2008. It declares that those certain pig slaughter and processing line 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. 0829844 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 Tariff Concession Instrument No. 0829844 was enacted in 2008 under the Customs Act 1901 to address the need for tariff concessions on specific goods. This legislation, implemented by the Chief Executive Officer of Customs, allows for a lower rate of customs duty on goods specified in a Tariff Concession Order (TCO). This was introduced to support industries by reducing the financial burden of customs duties on certain imported goods, thus fostering competitiveness and efficiency. The enacting body for this instrument is the Commonwealth Parliament, aiming to align with the policy objective of providing tariff concessions to promote economic growth and efficiency in targeted sectors.
The instrument was enacted following an application by Primo Smallgoods Pty Ltd for a TCO on certain pig slaughter and processing lines. After reviewing the application, the CEO determined that no substitutable goods were produced in Australia, thus meeting the core criteria under the Customs Act. The resulting Tariff Concession Instrument No. 0829844, which came into force on 5 September 2008, exempts these specified pig slaughter and processing lines from the general duty rate of 5%, instead applying a duty-free rate as per item 50 of Schedule 4 to the Customs Tariff Act 1995. This measure ensures that the rights of importers are not adversely affected and provides them with the opportunity to apply for a refund of any duties paid prior to the TCO’s effective date.
Scope and Application
The Customs Act 1901, specifically Part XVA, governs the process through which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs (CEO). The Act applies to individuals and entities seeking tariff concessions for certain goods, aiming to reduce the customs duty on these goods. The application process requires the applicant to demonstrate that no substitutable goods are produced in Australia in the ordinary course of business, a criterion laid out in section 269C of the Act. The scope of the Act extends to all Commonwealth jurisdictions, and the application of a TCO is effective from the date of the application's lodgement, as stipulated in subsection 269S(1). Notably, the Act does not disadvantage any person other than the Commonwealth by imposing liabilities for actions taken prior to the TCO's registration. TCO No. 0829844, concerning certain pig slaughter and processing lines, exemplifies this legislative application by setting the duty rate at free, whereas the general rate is 5%.
Key Provisions
The primary sections of the Tariff Concession Instrument No. 0829844 (the Instrument) under the Customs Act 1901 (the Act) pertain to the making of Tariff Concession Orders (TCOs) (s 269F). Section 269C outlines the core criteria that an application for a TCO must meet, which includes ensuring that no substitutable goods are produced in Australia in the ordinary course of business on the day the application is lodged (s 269P(3)). If these criteria are satisfied, the Chief Executive Officer of Customs (the CEO) is mandated to issue a TCO, effectively applying a prescribed rate of duty to the specified goods (s 269P(3)). The Instrument specifically addresses pig slaughter and processing lines, declaring them to be subject to a zero rate of duty (item 50 of Schedule 4 to the Customs Tariff Act 1995).
The obligations imposed by the Act on the parties involved include the requirement for the CEO to assess whether an application for a TCO meets the core criteria (s 269C). This involves verifying that no substitutable goods are produced in Australia at the time of application, as defined by the Act (s 269D and s 269E). Additionally, the CEO must publish a notice in the Gazette inviting submissions from any interested parties who might have reasons to oppose the TCO (s 269K(1)). In this case, no submissions were received, indicating that the CEO proceeded with the TCO as no objections were raised. The rights of importers are also protected under the Act, allowing them to apply for a refund of duty on goods imported since the TCO came into effect (Regulation 126(1)(r)).
The Act does not explicitly outline specific offences, penalties, or consequences for breaches related to TCOs. However, the general legal framework under the Customs Act 1901 provides for various offences and penalties. For instance, section 268 of the Act stipulates that any person who makes a false or misleading statement in an application for a TCO may face criminal penalties, including fines and imprisonment. Additionally, the Tariff Act and related regulations may impose civil penalties for non-compliance with customs duties and related obligations. While the specific penalties for breaches related to TCOs are not detailed in the Instrument, the overarching legislative framework ensures that any misconduct or non-compliance is subject to appropriate legal consequences.