EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0840473
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.
Austral Wright Metals applied for a TCO in respect of certain copper nickel tubes or pipes on 20 November 2008.
Instrument
TCO No 0840473 was made on 27 February 2009. It declares that those certain copper nickel tubes or pipes 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. 0840473 is taken to have come into force on 20 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. 0840473, enacted in 2009 under the Customs Act 1901, was introduced to address the need for tariff concessions on specific imported goods. This instrument allows the Chief Executive Officer of Customs to grant tariff concessions that lower the rate of customs duty on certain goods. The Act provides a framework for applications for tariff concession orders (TCOs) and outlines the conditions under which such orders can be made, such as when no substitutable goods are produced in Australia. The policy objective is to provide relief to importers by reducing the duty on certain imported goods, thereby promoting trade and economic efficiency. The instrument came into force on the date the application was lodged, 20 November 2008, and does not affect any pre-existing rights or impose new liabilities on individuals or entities.
Scope and Application
The Customs Act 1901, through its Tariff Concession Orders, applies to any person or entity seeking a lower rate of customs duty on specific imported goods, provided those goods are not listed in section 269SJ as ineligible for such concessions. The application process requires that the goods in question are not substitutable by any produced domestically in the ordinary course of business, as defined in sections 269D and 269E. This Act's reach is national, operating under the Commonwealth jurisdiction, yet its implementation and the specifics of the concessions are detailed in the subordinate Customs Tariff Act 1995. The application process mandates public notice and consultation, ensuring transparency and opportunity for objections. The effective date of any Tariff Concession Order is the date of the application, as per subsection 269S(1), and it does not retroactively affect pre-existing rights or liabilities, thus safeguarding the interests of all parties involved.
Key Provisions
The Tariff Concession Instrument No. 0840473 (the Instrument) applies to certain copper nickel tubes or pipes, as declared by the Chief Executive Officer of Customs (the CEO) under section 269P(3) of the Customs Act 1901 (the Act). This Instrument, TCO No. 0840473, was made on 27 February 2009 and is based on an application submitted by Austral Wright Metals on 20 November 2008. The Instrument specifies that these goods are subject to a lower rate of customs duty as per item 50 of Schedule 4 to the Customs Tariff Act 1995 (the Tariff), with the duty rate being free instead of the general rate of 5%.
In accordance with section 269C of the Act, the CEO was required to determine if the application for the Tariff Concession Order (TCO) met the core criteria, which involves confirming that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. As per the definitions provided in the Act, ‘substitutable goods’ are those produced in Australia that can be put to a use corresponding with the use of the goods in question. The CEO was satisfied that no such goods existed, thereby allowing the TCO to proceed. The Instrument came into force on 20 November 2008, the day the application was lodged, as per subsection 269S(1) of the Act.
The obligations under this Instrument include the requirement for Austral Wright Metals, or any other entity applying for a TCO, to ensure that their application is made in accordance with the provisions of the Act. This involves demonstrating that no substitutable goods are produced in Australia in the ordinary course of business on the application date. The CEO, upon receiving a valid application, must publish a notice in the Gazette inviting submissions from any interested parties who may object to the making of the TCO. In this case, no submissions were received, allowing the CEO to proceed with the order. The Instrument does not affect the rights of any person other than the Commonwealth as at the date of registration, nor does it impose any liabilities on any person.
In terms of compliance and enforcement, the Act does not specify any particular offences, penalties, or civil or criminal consequences for breaches related to the making or non-compliance with a TCO. However, general compliance with the Customs Act 1901 and associated regulations is critical. Failure to adhere to the conditions specified in a TCO or the broader obligations under the Customs Act could result in legal action, including potential fines and other penalties as prescribed under the Act. It is important for parties involved to ensure strict adherence to the terms and conditions set forth in the Instrument and the Act to avoid any legal repercussions.