EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0845337
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.
Universal Biosensors applied for a TCO in respect of certain spacer machine on 24 December 2008.
Instrument
TCO No 0845337 was made on 20 March 2009. It declares that those certain spacer machine 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. 0845337 is taken to have come into force on 24 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 Order Instrument No. 0845337, enacted under the Customs Act 1901, addresses the issue of tariff concessions for specific goods by providing a mechanism for reducing customs duty. This instrument was introduced to facilitate the application process for tariff concessions, ensuring that the Chief Executive Officer of Customs can efficiently assess and approve applications where appropriate. The instrument was created by the Parliament of Australia with the objective of promoting fair trade practices by ensuring that goods not produced domestically are subject to reduced tariffs, thereby encouraging import and use of such goods.
The instrument was made on 20 March 2009, following an application by Universal Biosensors for tariff concession on certain spacer machines. The Customs Act 1901 mandates that the CEO must ensure no substitutable goods are produced in Australia before approving an application. In this case, the CEO determined that no such goods were produced and thus issued a Tariff Concession Order, which came into effect on 24 December 2008. This order provides significant relief to importers of these machines by exempting them from the usual 5% duty, allowing for a more competitive market and potential cost savings for businesses.
Scope and Application
The Customs Act 1901, specifically Part XVA, governs the procedure for issuing Tariff Concession Orders (TCO) which allow for a lower rate of customs duty on certain goods. The Act applies to any person or entity that seeks a concession on customs duty for goods they wish to import, provided that these goods are not specified in section 269SJ of the Act as those ineligible for TCOs. The Act's application is national in scope, extending to all jurisdictions under the Commonwealth of Australia. An application for a TCO is assessed by the Chief Executive Officer of Customs (CEO), who must determine whether the application meets the core criteria, primarily whether no substitutable goods are produced in Australia at the time of application. If the CEO is satisfied that the application meets these criteria, they must issue a written order declaring the goods eligible for a tariff concession, with the concession effective from the date the application was lodged. The application process includes a requirement for the CEO to publish a notice in the Gazette, inviting submissions from interested parties, though in this instance, no submissions were received. The issuance of a TCO does not retroactively affect the rights of any person and does not impose any liabilities on persons other than the Commonwealth.
Key Provisions
The main operative sections of the Customs Act 1901, as outlined in Tariff Concession Instrument No. 0845337, establish a framework for the creation of Tariff Concession Orders (TCOs) (s 269C, s 269F, s 269K, s 269P, s 269S). Under this scheme, a TCO can be made by the Chief Executive Officer (CEO) of Customs when a person applies for a TCO for certain goods (s 269F). The CEO must assess the application to determine whether it meets the core criteria, which include verifying that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (s 269C). If the application satisfies these criteria, the CEO must make a written order (a TCO) specifying the lower rate of customs duty applicable to the goods (s 269P(3)).
The obligations imposed on the parties by this Act include the requirement for the CEO to publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO (s 269K(1)). The CEO is also required to decide whether the TCO application meets the core criteria, which involves determining if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (s 269C). Additionally, the TCO must be published in the Gazette, and any submissions received must be considered before a decision is made.
Offences, penalties, or consequences for breach of this Act are not explicitly detailed in the provided text. However, the Act does not impose any liabilities on any person, and the rights of importers will be beneficially affected, as they can apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force (s 269S(1)). 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 Tariff Concession Instrument No. 0845337, which was made on 20 March 2009, declares that certain spacer machines are goods to which item 50 of Schedule 4 to the Tariff applies, as the CEO was satisfied that no substitutable goods were produced in Australia. The general rate of duty on these goods is 5%, but the rate of duty for the goods subject to the TCO is free. This instrument came into force on 24 December 2008, the day on which the application for the TCO was lodged. The TCO does not impose any liabilities on any person, and the rights of importers will be beneficially affected as they can apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force.