EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0839894
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.
Minco Australia Pty Ltd applied for a TCO in respect of certain molten metal samplers on 27 October 2008.
Instrument
TCO No 0839894 was made on 16 January 2009. It declares that those certain molten metal samplers 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. 0839894 is taken to have come into force on 27 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 Tariff Concession Instrument No. 0839894, issued under the Customs Act 1901, addresses the need for tariff concessions on specific goods by providing a mechanism for reduced customs duty rates. Enacted in 2009, this legislation aims to facilitate the importation of goods that are not produced domestically, thereby promoting economic efficiency and competitiveness. The instrument was introduced to ensure that applications for tariff concessions are handled by the Chief Executive Officer of Customs, who assesses whether the goods in question meet the criteria for concession, specifically if no substitutable goods are produced in Australia. This process ensures that the application of tariff concessions does not disadvantage domestic producers or impose undue liabilities on individuals or entities other than the Commonwealth. The policy objective is to provide clarity and procedural fairness in the application and assessment of tariff concession orders.
Scope and Application
The Tariff Concession Instrument No. 0839894 under the Customs Act 1901 applies to the person or entity making an application for a Tariff Concession Order (TCO) in respect of goods, as provided for in section 269F of the Act. The instrument is specifically concerned with certain molten metal samplers for which Minco Australia Pty Ltd applied on 27 October 2008. The application was processed by the Chief Executive Officer of Customs (CEO) and, upon meeting the core criteria outlined in sections 269C, 269B, and 269D of the Act, resulted in the issuance of the TCO on 16 January 2009. This instrument imposes a free rate of duty on the specified goods, which otherwise attract a general rate of 5%. The instrument does not affect any rights or impose any liabilities on persons other than the Commonwealth, and it does not disadvantage any individual or entity as it pertains only to actions taken post the date of the instrument’s registration.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0839894 (F2009L01047) pertain to the process and criteria for the approval and application of Tariff Concession Orders (TCOs) under the Customs Act 1901. Specifically, section 269F outlines the application process for a TCO, where an individual or entity can apply to the Chief Executive Officer of Customs (CEO) for a concession on customs duty rates for certain goods. Section 269C establishes that a TCO application meets the core criteria if, on the day of application, no substitutable goods were produced in Australia in the ordinary course of business, as defined by sections 269D and 269E. Upon satisfying these criteria, the CEO is mandated to make a written order under section 269P(3), which declares that the goods subject to the TCO application will be subject to a reduced duty rate as specified in the Customs Tariff Act 1995.
The Act imposes several obligations on the parties involved. For applicants, the primary requirement is to ensure that their application is lodged in accordance with the provisions of section 269F and that it meets the core criteria specified in section 269C. The CEO, on the other hand, is obligated to review the application, determine whether the core criteria are met, and, if so, proceed to make a written order under section 269P(3). Additionally, under section 269K(1), the CEO must publish a notice in the Gazette inviting any interested parties to submit objections to the TCO within a specified period.
Breaches of the provisions outlined in the Customs Act 1901 can lead to various penalties and consequences. Although the Explanatory Statement does not explicitly detail penalties for non-compliance, the Act generally provides for both civil and criminal sanctions for violations of customs regulations. Typically, civil penalties may include fines, while criminal penalties could involve imprisonment, depending on the severity and nature of the breach. The specifics of these penalties are usually outlined in the relevant sections of the Act and any associated regulations.
In summary, Tariff Concession Instrument No. 0839894 facilitates the reduction of customs duty rates for certain goods through the issuance of TCOs, provided that the application meets the stipulated criteria and no substitutable goods are produced in Australia. The obligations primarily rest on the applicant to ensure compliance with the application process and on the CEO to review and act on valid applications. Any breaches of the provisions under the Customs Act 1901 may result in civil or criminal penalties, though the exact penalties are not specified in this particular Explanatory Statement.