EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0832371
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.
Hillgrove Copper Pty Limited applied for a TCO in respect of certain trommel on 23 September 2008.
Instrument
TCO No 0832371 was made on 12 December 2008. It declares that those certain trommel 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. 0832371 is taken to have come into force on 23 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. 0832371 was enacted in 2008 to address a specific issue under the Customs Act 1901. This legislation was introduced to facilitate tariff concessions for certain goods, specifically in the case of trommel applied for by Hillgrove Copper Pty Limited, aiming to provide a lower rate of customs duty for those goods. The Customs Act 1901 provides a framework through which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs, allowing for reduced customs duty on specified goods. The primary objective of this instrument was to ensure that such tariff concessions could be effectively implemented, thereby benefiting importers by potentially reducing their duty liabilities on specified goods.
The Australian Parliament enacted this instrument to streamline the process of applying for and granting tariff concessions. By declaring that certain trommel are subject to a zero percent duty rate under item 50 of Schedule 4 to the Customs Tariff Act 1995, the legislation ensures that no substitutable goods were produced in Australia at the time of the application. This legislative action facilitates smoother importation processes and aligns with the broader policy objective of supporting Australian businesses by reducing certain import costs.
Scope and Application
The Tariff Concession Instrument No. 0832371 under the Customs Act 1901 applies to specific goods, in this case certain trommel, which are declared to be subject to a lower rate of customs duty as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995. The Act provides a framework through which the Chief Executive Officer (CEO) of Customs can make Tariff Concession Orders (TCOs) for goods, provided that certain criteria are met, including the absence of substitutable goods being produced in Australia. This instrument is applicable to any entity or individual involved in the importation of the specified goods, thereby directly affecting their customs duties. The application of this Act is national in scope, given the Customs Act's overarching authority in regulating customs and excise duties across Australia. The instrument does not impose any new liabilities on persons other than the Commonwealth and does not affect the rights of individuals as they stood on the date of the application. Furthermore, while the Act extends its application through subordinate instruments, such as the Tariff Concession Instrument, these instruments are specifically tailored to the goods and conditions outlined in each case.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 0832371 under the Customs Act 1901 (section 269F) allow for the application of lower rates of customs duty on goods specified in a Tariff Concession Order (TCO). When an application is made to the Chief Executive Officer of Customs (CEO) (section 269F), the CEO must consider whether the application meets the core criteria (section 269C). If satisfied that no substitutable goods are produced in Australia (section 269C), the CEO must issue a TCO (section 269P(3)) that specifies the reduced rate of duty for the goods in question.
The Customs Act imposes several obligations on the parties involved. For applicants, it is necessary to ensure that the goods for which a TCO is sought are not specified in section 269SJ, which lists goods ineligible for a TCO (section 269F). The CEO is required to publish a notice in the Gazette inviting submissions from interested parties if they believe a TCO should not proceed (subsection 269K(1)). Additionally, the CEO must evaluate whether the application meets the core criteria, which includes verifying that no substitutable goods are produced in Australia (section 269C). The TCO is considered effective from the date of the application (subsection 269S(1)), and it does not affect any existing rights or liabilities of non-Commonwealth persons prior to its registration.
Breaching the requirements set out in the Customs Act can lead to both civil and criminal consequences. While specific offences and penalties are not detailed in the explanatory statement, generally under the Customs Act, breaches may result in fines, imprisonment, or both, depending on the severity of the offence. The exact penalties would be determined by the courts based on the specific breach and its impact. For instance, providing false information in an application or failing to comply with a TCO could lead to significant penalties, including fines up to several thousand dollars and potential imprisonment terms.
In summary, the Tariff Concession Instrument No. 0832371 simplifies the process for obtaining reduced customs duty rates for specific goods by establishing clear criteria and obligations for both applicants and the CEO. The Act ensures that rights and liabilities are preserved for non-Commonwealth persons, and it outlines the commencement date for the TCO. While the explanatory statement does not detail specific penalties for breaches, the Customs Act generally provides for severe consequences, including fines and imprisonment, for non-compliance with its provisions.