EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0840468
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.
Koeppern Machinery Australia Pty Ltd applied for a TCO in respect of certain roller press parts on 19 November 2008.
Instrument
TCO No 0840468 was made on 06 February 2009. It declares that those certain roller press parts 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. 0840468 is taken to have come into force on 19 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 Tariff Concession Instrument No. 0840468, enacted in 2009, amends the Customs Act 1901 by providing tariff concessions for certain roller press parts, specifically those identified by Koeppern Machinery Australia Pty Ltd. This legislative instrument aims to address the gap in tariff concessions for these specific parts by providing a lower rate of customs duty, thereby facilitating the importation of these goods into Australia. The instrument was introduced to ensure that these goods are subject to the appropriate duty rate as stipulated by the Customs Tariff Act 1995. The enacting body responsible for this instrument is the Chief Executive Officer of Customs, who must assess applications for Tariff Concession Orders (TCOs) and ensure they meet the core criteria outlined in the Customs Act 1901. The policy objective is to promote the efficient and competitive importation of goods by providing necessary tariff concessions where applicable.
Scope and Application
The Customs Act 1901, through its Part XVA, establishes a framework for the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. These orders provide for a reduced rate of customs duty on specified goods, provided that certain criteria are met. An application for a TCO can be made by any person, but it must not relate to goods that are explicitly excluded under section 269SJ of the Act. The CEO evaluates applications against the core criteria outlined in sections 269C and 269D, which require, among other things, that no substitutable goods are produced in Australia at the time of application. Once these criteria are satisfied, a written TCO is issued, and the reduced duty rate specified in the Customs Tariff Act 1995 becomes applicable. The TCO does not retroactively affect the rights of any person other than the Commonwealth and does not impose any new liabilities. Importantly, the rights of importers are positively affected as they can apply for duty refunds on goods imported since the TCO's effective date. The TCO does not extend to affect any transactions or duties that occurred prior to its registration date.
Key Provisions
The Tariff Concession Instrument No. 0840468 (the Instrument) applies under section 269P(3) of the Customs Act 1901 (the Act) to declare certain roller press parts as goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies. This means that the general rate of duty of 5% is reduced to free duty for these goods. This concession is contingent upon the Chief Executive Officer of Customs (the CEO) being satisfied that no substitutable goods are produced in Australia (section 269C).
The Instrument outlines the obligations of the CEO in processing a Tariff Concession Order (TCO) application under section 269F. If the CEO determines that the application meets the core criteria, as outlined in sections 269B to 269E, they must make a written order (section 269P(3)). For this specific Instrument, the CEO was satisfied that no substitutable goods were produced in Australia in the ordinary course of business. Consequently, the CEO issued TCO No. 0840468 on 6 February 2009, declaring that the goods in question are to which item 50 of Schedule 4 to the Tariff applies.
The CEO is required to publish a notice in the Gazette under subsection 269K(1) as soon as practicable after accepting a TCO application as valid, inviting any person who considers there are reasons why the TCO should not be made to lodge a submission with the CEO. In this case, the CEO did not receive any submissions in response to the invitation. The TCO is taken to have come into force on the day on which the application was lodged, which was 19 November 2008 (subsection 269S(1)). Importantly, the TCO does not affect the rights of any person as at the date of registration so as to disadvantage that person or impose liabilities on a person in respect of anything done or omitted to be done before the date of registration.
The Act does not specify any offences, penalties, or civil/criminal consequences for breach in the context of TCOs. However, it is implied that any improper application or misuse of the concessions granted by a TCO could potentially lead to legal consequences under the broader framework of the Customs Act 1901, including potential penalties for fraudulent or improper declarations. The specific consequences would depend on the nature and extent of the breach.