EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0904876
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.
Anz Winemakers applied for a TCO in respect of certain tartaric stabilisation plant on 13 February 2009.
Instrument
TCO No 0904876 was made on 08 May 2009. It declares that those certain tartaric stabilisation plant 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. 0904876 is taken to have come into force on 13 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 Tariff Concession Instrument No. 0904876 was enacted in 2009 under the Customs Act 1901 to address the need for tariff concessions on specific goods that are not produced domestically. This legislation was introduced to support industries that require imported goods not readily available in Australia. The instrument was created in response to an application by Anz Winemakers for tariff concessions on certain tartaric stabilisation plant. The Customs Act 1901 provides a framework for the Chief Executive Officer of Customs to consider and grant tariff concession orders if certain criteria are met, such as the absence of substitutable goods produced in Australia. The enactment of this instrument aims to facilitate the importation of these specific goods without imposing duties, thereby benefiting the relevant industry and importers. The instrument came into force on the date the application was lodged, and no submissions were received against its implementation.
Scope and Application
The Customs Act 1901 provides a framework for Tariff Concession Orders (TCOs) under which the Chief Executive Officer of Customs (CEO) may apply a lower rate of customs duty to certain goods, provided that specific criteria are met. This instrument is specifically tailored to benefit industries by potentially reducing their import costs. For instance, TCO No. 0904876, made on 8 May 2009, applies to certain tartaric stabilisation plant, reducing the duty rate from 5% to free. The application of this Act is national, impacting all entities involved in the importation of the specified goods within Australia. Exclusions apply to goods specified in section 269SJ of the Act, which cannot be subject to a TCO. The scope of the Act is further extended through subordinate instruments which may provide additional details or specific cases where TCOs can be applied. The Act does not disadvantage any person by affecting their rights as at the date of registration, nor does it impose any liabilities for actions taken prior to the TCO's effective date.
Key Provisions
The key operative sections of the Customs Act 1901, specifically under Part XVA, pertain to the creation and implementation of Tariff Concession Orders (TCOs) (section 269F). Section 269C sets the core criteria for a TCO, which requires that no substitutable goods were produced in Australia on the day the application was lodged (section 269P(3)). If the Chief Executive Officer of Customs (CEO) is satisfied that these criteria are met, they must make a written order (section 269P(3)) declaring that the goods in question are subject to a prescribed item in Schedule 4 to the Customs Tariff Act 1995, effectively reducing the customs duty rate. In this instance, TCO No. 0904876 was made for certain tartaric stabilisation plant, reducing the duty rate from 5% to free (section 269S).
The Customs Act 1901 imposes specific obligations on the CEO and applicants for TCOs. The CEO must review the application to ensure it does not pertain to goods specified in section 269SJ of the Act and verify that the core criteria in section 269C are met. If satisfied, the CEO must make a written TCO. Additionally, the CEO is required to publish a notice in the Gazette inviting submissions from interested parties if any exist (subsection 269K(1)). This ensures transparency and allows for public input before a TCO is made. The CEO must also ensure that the TCO does not disadvantage or impose liabilities on anyone other than the Commonwealth in respect of actions taken before the registration date (subsection 269S(1)).
Under the Customs Act 1995, breaches of the Act can lead to both civil and criminal consequences. Although the explanatory statement does not explicitly detail penalties, breaches of customs regulations typically result in fines and potential imprisonment. The severity of the penalty depends on the nature and severity of the breach, with maximum penalties available for serious or repeated offences. It is also worth noting that importers may seek refunds for duties paid on goods imported after the TCO comes into effect, as outlined in paragraph 126(1)(r) of the Regulations.
The Tariff Concession Instrument No. 0904876, which was made on 8 May 2009, effectively reduces the customs duty on certain tartaric stabilisation plant to zero, provided the CEO determines that no substitutable goods were produced in Australia at the time of application. The instrument does not disadvantage any person other than the Commonwealth or impose any liabilities on individuals for actions taken before its effective date. This legislative action ensures that the rights of importers are protected and benefits them by reducing their customs duty burden.