EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0903794
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.
Esso Australia Resources applied for a TCO in respect of certain umbilicals subsea on 05 February 2009.
Instrument
TCO No 0903794 was made on 08 May 2009. It declares that those certain umbilicals subsea 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. 0903794 is taken to have come into force on 05 February 2009.
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 Customs Act 1901, enacted by the Parliament of Australia, establishes a framework for the regulation of imports and exports, including the imposition of customs duties. Part XVA of the Act introduces the concept of Tariff Concession Orders (TCOs), which allow for the reduction of customs duties on certain imported goods under specific circumstances. This mechanism aims to address the problem of ensuring that imported goods for which there are no Australian-made substitutes receive preferential tariff treatment, thereby supporting industries that might otherwise be uncompetitive due to the lack of domestic production of similar goods.
The Tariff Concession Instrument No. 0903794, issued under the authority of the Customs Act 1901, was enacted to provide a tariff concession for certain umbilicals subsea. This concession was made after Esso Australia Resources applied for a TCO on 5 February 2009, and the Chief Executive Officer of Customs was satisfied that no substitutable goods were produced in Australia. The policy objective of this instrument is to support the importation of these specific goods by eliminating customs duties, thereby potentially enhancing the competitiveness of Australian industries that rely on such imports.
Scope and Application
The Tariff Concession Instrument No. 0903794, enacted under the Customs Act 1901, applies to individuals or entities seeking tariff concessions for specific goods that are not produced in Australia in the ordinary course of business. The instrument pertains to the application submitted by Esso Australia Resources for certain umbilicals subsea, which were declared to be subject to a lower rate of customs duty as per item 50 of Schedule 4 to the Customs Tariff Act 1995. The Act ensures that the application process is transparent by requiring the Chief Executive Officer of Customs to publish a notice in the Gazette inviting any interested party to lodge submissions if they believe the tariff concession should not be granted. This particular application, which was submitted on 05 February 2009, was made effective from the same date, providing immediate benefit to importers who can now apply for a refund of duty on goods imported since the commencement date. The instrument does not impose any liabilities on any person other than the Commonwealth and does not affect existing rights as at the date of registration.
Key Provisions
The main operative sections of this legislation pertain to Tariff Concession Orders (TCOs) under the Customs Act 1901 (section 269C). They establish the framework for the Chief Executive Officer (CEO) of Customs to grant lower rates of customs duty on certain goods. When a person applies for a TCO, the CEO must first ensure that the goods are not excluded from such concessions (section 269SJ). If the application is valid, the CEO must decide if it meets the core criteria, primarily that no substitutable goods were produced in Australia at the time of application (section 269C). If these criteria are met, a TCO is issued (section 269P(3)).
The Act imposes certain obligations on the parties involved. For instance, applicants must submit their requests in a manner compliant with the Act, ensuring they meet the specified criteria for a TCO (section 269F). The CEO, in turn, is obligated to review applications promptly and decide whether they meet the core criteria (section 269C). Additionally, the CEO must publish a notice in the Gazette inviting public submissions on the proposed TCO and consider any submissions received (section 269K(1)). This transparency ensures that all interested parties have an opportunity to voice any concerns regarding the proposed concession.
There are no explicit offences, penalties, or civil/criminal consequences outlined for breaches of this legislation in the provided text. However, failure to comply with the requirements for TCO applications or non-compliance with the conditions set out in a TCO could potentially lead to disputes or challenges regarding the validity of the TCO or the duty rates applied. The Customs Act 1901 and associated regulations would govern any such disputes, with potential remedies including duty refunds or adjustments in accordance with the legal framework.