EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0839507
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.
Lisec Australia Pty Ltd applied for a TCO in respect of certain glass handling equipment viridian on 11 November 2008.
Instrument
TCO No 0839507 was made on 30 January 2009. It declares that those certain glass handling equipment viridian 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. 0839507 is taken to have come into force on 11 November 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, established a framework under which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs (CEO). This was introduced to address the need for a mechanism to provide tariff concessions for certain goods, thereby encouraging imports and benefiting the Australian market by reducing customs duties on specific items. This particular legislation, Tariff Concession Instrument No. 0839507, was made on 30 January 2009, following an application by Lisec Australia Pty Ltd for certain glass handling equipment known as viridian. The CEO determined that no substitutable goods were produced in Australia, thus meeting the core criteria set out in the Act. As a result, the TCO declared that these specific goods would be subject to a zero rate of duty, down from the general rate of 5%. The policy objective was to ensure that the application process was transparent, with an invitation for public submissions, though none were received in this instance. The TCO came into effect on the date the application was lodged, 11 November 2008, and it was designed to favourably impact the rights of importers by allowing them to apply for duty refunds on imports made since that date, without imposing any liabilities.
Scope and Application
The Tariff Concession Instrument No. 0839507 under the Customs Act 1901 applies to the goods specified in the instrument, namely certain glass handling equipment viridian, and the parties involved in the importation of these goods. This instrument was made pursuant to section 269F of the Act, which allows for the application of tariff concessions to goods not produced in Australia and for which no substitutable goods are produced domestically. The Chief Executive Officer of Customs (CEO) assessed the application from Lisec Australia Pty Ltd and determined that the application met the core criteria as outlined in section 269C of the Act, leading to the issuance of the TCO on 30 January 2009. The application of this Instrument is national in scope, as it falls under the Commonwealth jurisdiction of the Customs Act 1901. Any person involved in the importation of the specified glass handling equipment viridian will be subject to the terms of this TCO, which provides for a reduction in customs duty from the general rate of 5% to free. The TCO does not disadvantage any existing rights of parties other than the Commonwealth and imposes no new liabilities, aligning with the protections outlined in subsection 269S(1) of the Act. The CEO also ensured that any interested parties had an opportunity to submit objections to the TCO, as required by subsection 269K(1), although no submissions were received in this case.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 0839507 are sections 269C, 269P, and 269S of the Customs Act 1901. Section 269C outlines the core criteria that must be met for an application for a Tariff Concession Order (TCO) to be considered valid. According to this section, an application will meet the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269P(3) mandates that if the Chief Executive Officer of Customs (CEO) is satisfied that the application meets these core criteria, they must make a written order declaring the goods in question to be subject to a specified tariff concession. Section 269S(1) stipulates that a TCO is to be considered as having come into force on the day on which the application for the TCO was lodged.
The Customs Act 1901 imposes specific obligations on the CEO regarding the processing and approval of TCO applications. Under section 269F, a person may apply to the CEO for a TCO in respect of goods. If the CEO determines that the application is not for goods specified in section 269SJ, which lists those goods that cannot be subject to a TCO, they must then assess whether the application meets the core criteria as per section 269C. If satisfied, the CEO must publish a notice in the Gazette inviting submissions from any interested parties, as per subsection 269K(1). The CEO must also ensure that the TCO does not adversely affect the rights of any person other than the Commonwealth, in accordance with subsection 269S(3).
Breaching the requirements set out in the Customs Act 1901 may result in various legal consequences. However, the explanatory statement does not explicitly detail offences, penalties, or specific civil or criminal consequences for breaches related to the issuance of TCOs. The Act generally provides for penalties through other sections not specifically mentioned in the explanatory statement, which may include fines or imprisonment depending on the nature and severity of the breach. For more detailed information on penalties, one would need to refer to the broader provisions of the Customs Act 1901 and related regulations.