EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0831995
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.
Tyrout Australia applied for a TCO in respect of certain wire saws on 19 September 2008.
Instrument
TCO No 0831995 was made on 05 December 2008. It declares that those certain wire saws 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. 0831995 is taken to have come into force on 05 December 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. 0831995, enacted in 2008, serves to provide tariff concessions on certain wire saws as per the Customs Act 1901. This legislation was enacted by the Australian Parliament to address the need for tariff reductions on specific goods where there is no domestic production of substitutable goods. The core objective of this instrument, as stated in the Act, is to provide tariff concessions when it is determined that no substitutable goods are produced in Australia. The instrument was developed following an application by Tyrout Australia, and the Chief Executive Officer of Customs made a determination that no substitutable goods were produced domestically, thus satisfying the core criteria for tariff concession. The instrument was published in the Gazette, and no submissions were received in opposition to the concession. The tariff concession came into effect on the date the application was lodged, thereby providing immediate benefits to importers by potentially allowing them to apply for a refund of duty on goods imported since the effective date of the concession.
Scope and Application
The Customs Act 1901, through its Part XVA, facilitates the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. These orders apply to specific goods for which an applicant can seek reduced customs duty rates. The Act applies to any individual or entity seeking to import goods into Australia and thereby benefit from lower duty rates if a TCO is granted. The application of a TCO is contingent upon the goods not being substitutable with any produced in Australia, as per the definitions provided in the Act. The instrument operates nationally, aligning with the broader federal jurisdiction of the Customs Act 1901. The application process includes a mandatory publication in the Gazette to invite submissions, although no submissions were received for TCO No. 0831995. The effective date of the TCO is the day the application is lodged, in this case, 5 December 2008, and it does not retroactively affect any rights or impose new liabilities on parties other than the Commonwealth.
Key Provisions
The main operative sections of this legislation, specifically F2009L00550, detail the process and criteria for making Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269F of the Act provides the mechanism for an application to be submitted to the Chief Executive Officer of Customs (CEO) for a TCO in respect of certain goods. The CEO must then determine if the application meets the core criteria as outlined in sections 269C, 269B, and 269D of the Act, particularly considering whether substitutable goods are produced in Australia (section 269C). If the CEO is satisfied that the application meets these criteria, they must make a written TCO, as stipulated in section 269P(3). In this case, TCO No. 0831995 was made on 5 December 2008, declaring that certain wire saws are subject to a lower rate of customs duty, specifically item 50 of Schedule 4 to the Tariff.
The obligations imposed on the parties by this legislation include the requirement for applicants to ensure their applications meet the core criteria outlined in the Act. The CEO has the responsibility to review applications, consider any submissions received, and make a decision on whether to grant the TCO. Additionally, section 269K(1) mandates that the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made. This provision ensures transparency and provides an opportunity for interested parties to voice their concerns. The CEO must then consider these submissions before making a final decision.
In terms of offences and penalties, the Act does not explicitly outline specific penalties for breaches related to TCOs. However, general provisions in the Customs Act 1901 may apply for non-compliance or fraudulent activities. The Act does state that the TCO does not affect the rights of any person as at the date of registration in a way that disadvantages that person or imposes liabilities in respect of anything done or omitted before the registration date. This means that while the TCO may benefit importers by allowing them to apply for a refund of duty on goods imported since the TCO's effective date, it does not impose any new liabilities on individuals or entities.