EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0843546
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.
BHP Billiton applied for a TCO in respect of certain vacuum rotary disc filters on 11 December 2008.
Instrument
TCO No 0843546 was made on 06 March 2009. It declares that those certain vacuum rotary disc filters 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. 0843546 is taken to have come into force on 11 December 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. 0843546, enacted in 2009, addresses the need for tariff concessions under the Customs Act 1901, facilitating reduced customs duties for specified goods. This instrument was introduced to streamline the application process for tariff concessions, allowing for lower duty rates on goods that meet specific criteria, thereby enhancing trade efficiency and competitiveness. The instrument was enacted by the Chief Executive Officer of Customs in accordance with section 269F of the Customs Act 1901, ensuring that the application aligns with the legislative framework and policy objectives of the Act. The policy objective of this instrument is to provide tariff relief for goods where no substitutable goods are produced in Australia, thus benefiting importers and promoting economic activity by reducing the cost of imported goods.
Scope and Application
The Tariff Concession Instrument No. 0843546 under the Customs Act 1901 applies specifically to the entities or persons seeking tariff concessions for certain goods imported into Australia. The Act enables the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that reduce the rate of customs duty on specified goods. The instrument in question relates to a TCO application by BHP Billiton for certain vacuum rotary disc filters, which were granted a concession reducing the duty rate from 5% to free. This concession applies to goods imported from the date the application was lodged, 11 December 2008, without retroactively affecting the rights of any party other than the Commonwealth. The Act mandates that any person who believes a TCO should not be made can submit objections; however, in this instance, no such submissions were received. The scope of the Act extends to all entities and individuals subject to the customs duty regime in Australia, with the TCO applying nationally across all states and territories. The application process and criteria for concessions are outlined in sections 269C to 269SJ of the Act, which detail the conditions under which a TCO can be granted, including the requirement that no substitutable goods are produced in Australia at the time of application.
Key Provisions
The primary operative sections of this legislation involve the creation and implementation of Tariff Concession Orders (TCOs) as outlined in Part XVA of the Customs Act 1901 (sections 269C, 269F, and 269P). Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of certain goods. If the CEO determines that the application meets the core criteria (section 269C), they must make a written order (section 269P). This order declares that the specified goods are subject to a reduced rate of customs duty as outlined in the Customs Tariff Act 1995. In this case, Instrument TCO No. 0843546 was made on 6 March 2009, declaring that certain vacuum rotary disc filters would be subject to a 0% duty rate.
The obligations imposed on the parties by this Act include the requirement for the CEO to assess whether an application for a TCO meets the core criteria, which involves determining if no substitutable goods are being produced in Australia on the day the application was lodged (section 269C). Additionally, the CEO must publish a notice in the Gazette inviting submissions from interested parties if they believe the TCO should not be granted (subsection 269K(1)). The CEO must also consider any submissions received and make a decision based on the evidence and criteria provided in the Act. In the case of TCO No. 0843546, the CEO did not receive any submissions opposing the order.
In terms of offences, penalties, or consequences for breach, the Customs Act 1901 does not explicitly detail penalties for failing to comply with the TCO provisions. However, breaches of the Customs Act generally can lead to civil or criminal penalties, including fines and imprisonment, depending on the severity of the offence. For example, knowingly making a false statement or representation in a customs matter can result in a penalty of up to 10 years imprisonment or a fine of up to $220,000, or both, under section 229 of the Act. The specifics of penalties for breaches related to TCOs would likely be governed by the broader provisions of the Customs Act and any associated regulations. In this case, the TCO itself does not impose any liabilities on any person, and the rights of importers will be beneficially affected.