EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0838090
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.
Orica Australia Pty Ltd applied for a TCO in respect of certain oxydiethanol on 30 October 2008.
Instrument
TCO No 0838090 was made on 30 January 2009. It declares that those certain oxydiethanol 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. 0838090 is taken to have come into force on 30 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, enacted by the Australian Parliament, provides a framework for the imposition of customs duties on imported goods, among other things. This legislation was introduced to address the need for a systematic approach to managing customs duties and ensuring revenue collection. A significant component of this Act is the ability to grant tariff concessions through Tariff Concession Orders (TCOs), which allow for reduced or waived customs duties on certain goods under specified conditions. The instrument F2009L01080, known as Tariff Concession Instrument No. 0838090, was created under the authority of the Customs Act to facilitate these concessions. The instrument was designed to respond to an application by Orica Australia Pty Ltd for tariff concessions on certain oxydiethanol, ensuring these goods are subject to a reduced duty rate of free, as opposed to the general rate of 5%. This concession was granted after satisfying the core criteria, specifically that no substitutable goods were produced in Australia at the time of the application.
Scope and Application
The Tariff Concession Instrument No. 0838090 under the Customs Act 1901 applies to specific goods, in this case certain oxydiethanol, that are the subject of an application for a Tariff Concession Order (TCO). The legislation is relevant to entities or individuals who are involved in the importation of these goods, as it directly affects the rate of customs duty applied. The Act allows for the reduction or waiver of customs duties on goods that meet certain criteria, namely that no substitutable goods are produced in Australia in the ordinary course of business. The geographic reach of this Act is national, as it applies across Australia and is administered by the Commonwealth through the Chief Executive Officer of Customs. The Act excludes certain goods specified in section 269SJ, which cannot be subject to a TCO. The application process includes a mandatory public consultation period, although in this case, no submissions were received. The TCO itself does not retroactively affect the rights or impose liabilities on anyone other than the Commonwealth, ensuring that it only benefits those importing the goods after the effective date of the order.
Key Provisions
The Customs Act 1901, specifically under Part XVA, outlines a procedure for the Chief Executive Officer of Customs (CEO) to issue Tariff Concession Orders (TCOs) that apply reduced rates of customs duty on certain goods (ss 269C, 269F). A TCO is applicable if an application is made and the CEO is satisfied that the goods are not specified in section 269SJ of the Act as those that cannot receive a concession, and that no substitutable goods were produced in Australia at the time of the application (s 269SJ). The CEO must make a written order if the application meets these core criteria (s 269P(3)). In this case, Orica Australia Pty Ltd applied for a TCO concerning certain oxydiethanol on 30 October 2008, which was subsequently issued as TCO No. 0838090 on 30 January 2009 (s 269P(3)).
The Act imposes specific obligations on the CEO in handling TCO applications. Once an application is accepted as valid, the CEO must publish a notice in the Gazette inviting submissions from any interested parties who believe the TCO should not proceed (s 269K(1)). The CEO must also ensure that the application meets the core criteria, which involves confirming that no substitutable goods were produced in Australia in the ordinary course of business at the time of application (ss 269C, 269D, 269E). In this instance, no submissions were received by the CEO opposing the TCO, and the CEO was satisfied that the application met the necessary criteria.
Failure to comply with the requirements of the Customs Act 1901 regarding TCOs could result in legal consequences. Although the explanatory statement does not detail specific offences or penalties, non-compliance with the Act's provisions generally could lead to civil or criminal penalties. The severity of penalties would depend on the nature and extent of the breach, with potential outcomes including fines or other sanctions as prescribed by the Act. It is essential for all parties involved, including applicants and the CEO, to adhere strictly to the statutory requirements to avoid any adverse legal repercussions.