EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0837700
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.
Iluka (Eucla Basin) Pty Ltd applied for a TCO in respect of certain mineral stock piling and reclaimining plant on 29 October 2008.
Instrument
TCO No 0837700 was made on 16 January 2009. It declares that those certain mineral stock piling and reclaiming 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. 0837700 is taken to have come into force on 29 October 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 establish the framework for the administration of customs duties in Australia. The Act allows for the application of lower rates of customs duty on certain goods through the issuance of Tariff Concession Orders (TCOs). The 2009 Tariff Concession Instrument No. 0837700, which was introduced by the Commonwealth, specifically addresses the application for tariff concessions on certain mineral stock piling and reclaiming plant submitted by Iluka (Eucla Basin) Pty Ltd. The objective of this Instrument was to provide a tariff concession in line with the Act’s provisions by ensuring that the application met the core criteria, specifically that no substitutable goods were produced in Australia. The Instrument was made effective from 29 October 2008, the date the application was lodged, and no submissions were received in opposition to the order. The rights of importers were protected, and they could apply for a refund of duty on the specified goods imported since the commencement date.
Scope and Application
The Tariff Concession Instrument No. 0837700 under the Customs Act 1901 applies to specific goods, namely certain mineral stock piling and reclaiming plant, which have been granted a tariff concession order (TCO) by the Chief Executive Officer (CEO) of Customs. This instrument facilitates a reduction in the customs duty for these goods from the general rate of 5% to a rate of duty that is free. The application of this concession is limited to the goods specifically outlined in the instrument, and it is contingent upon the CEO's determination that no substitutable goods are produced in Australia. This concession directly benefits importers of these goods, allowing them to apply for a refund of any duties paid on imports of these goods since the TCO's effective date, which is 29 October 2008. The application of the TCO does not affect any existing rights or impose liabilities on persons other than the Commonwealth, as it does not disadvantage anyone or impose obligations for actions taken prior to its registration. The Act's provisions allow for further regulation and specification of TCOs through subordinate instruments, extending or restricting its application as necessary.
Key Provisions
The Customs Act 1901 (the Act) contains provisions that allow for the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (the CEO). Section 269F allows a person to apply to the CEO for a TCO in respect of goods, provided that the goods are not specified in section 269SJ, which lists goods that cannot be subject to a TCO. If the CEO is satisfied that the application meets the core criteria, a written order declaring the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies, must be made. Section 269C outlines the core criteria for a TCO application, specifically that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged.
The Act imposes obligations on both applicants and the CEO in the process of issuing TCOs. Section 269K(1) requires the CEO to publish a notice in the Gazette inviting submissions from any person who may have reasons to oppose the TCO. This allows for a degree of public consultation and ensures that all relevant parties have an opportunity to be heard. The CEO must then consider any submissions received before making a decision on whether to issue a TCO. In the case of TCO No. 0837700, no submissions were received, and the CEO proceeded to issue the order. The obligations of the applicant include ensuring that the application meets the core criteria and providing all necessary information for the CEO to make a decision.
Failure to comply with the requirements of the Act may result in various consequences. The Act does not explicitly outline offences or penalties for non-compliance in the context of TCOs. However, it is reasonable to infer that any breaches of the Act or Regulations could potentially lead to legal action, fines, or other penalties as determined by the relevant authorities. Additionally, the rights of importers will be beneficially affected under paragraph 126(1)(r) of the Regulations, which allows for the application of a refund of duty on goods imported since the TCO came into force. The Act also ensures that the TCO does not impose any liabilities on any person, thereby protecting them from any disadvantage or additional obligations as a result of the TCO.