EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0906259
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.
Acergy Australia applied for a TCO in respect of certain marine drive reels on 23 February 2009.
Instrument
TCO No 0906259 was made on 15 May 2009. It declares that those certain marine drive reels 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. 0906259 is taken to have come into force on 23 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. 0906259 was enacted in 2009 under the Customs Act 1901 to address the issue of tariff concessions for specific goods. The Customs Act 1901 establishes a framework for Tariff Concession Orders (TCOs), which allow for lower customs duty rates on certain goods. This legislation was introduced to facilitate applications for tariff concessions, ensuring that the Chief Executive Officer of Customs (CEO) could assess and approve these applications based on specific criteria, such as the production status of substitutable goods in Australia. The Tariff Concession Instrument No. 0906259, which came into effect on 23 February 2009, was made in response to an application by Acergy Australia for tariff concessions on certain marine drive reels, ultimately resulting in a duty rate of free for these goods. The process involved publishing a notice in the Gazette inviting submissions from interested parties, though none were received. This instrument ensures that the rights of importers are positively affected, allowing for potential duty refunds for goods imported since the TCO's effective date, while imposing no liabilities on any person.
Scope and Application
The Tariff Concession Instrument No. 0906259 under the Customs Act 1901 applies to individuals or entities seeking tariff concessions on specific goods entering Australia. The Act allows the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) for goods that meet certain criteria, such as the absence of substitutable goods produced in Australia. This concession effectively lowers or eliminates customs duties on these specified goods. The scope of the Act extends to all individuals and entities who apply for such tariff concessions and the goods they seek to import under these concessions. The Act operates nationally across Australia, as it is a Commonwealth Act. However, it excludes goods listed in section 269SJ of the Act, which cannot be subject to a TCO. The application of the Act may be further detailed through subordinate instruments, although the primary legislation itself sets out the core criteria and processes for TCOs.
Key Provisions
The main operative sections of this legislation pertain to Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269F (1) allows for applications to the Chief Executive Officer of Customs (CEO) to establish a TCO for specific goods. Section 269C sets out the core criteria for the CEO to consider when deciding whether to grant a TCO, focusing on whether substitutable goods are produced in Australia. Section 269B provides definitions for key terms such as "goods produced in Australia", "ordinary course of business", and "substitutable goods". Upon meeting the core criteria, Section 269P(3) mandates the CEO to issue a written TCO.
The obligations and requirements imposed by the Act on the parties involved are primarily centred around the application process and the criteria for granting a TCO. The CEO must ensure that any TCO application complies with the core criteria outlined in Section 269C. This includes verifying that no substitutable goods are produced in Australia at the time the application is made. Furthermore, Section 269K(1) requires the CEO to publish a notice in the Gazette after accepting a TCO application, inviting submissions from interested parties. The CEO is also obligated to consider any submissions received in response to the notice.
Regarding the potential consequences for non-compliance, the Customs Act 1901 does not explicitly detail offences, penalties, or civil/criminal consequences for breach of the TCO provisions within this specific legislation. However, general provisions within the Act and related regulations may apply. For instance, any misuse or fraudulent claims related to customs duties could lead to legal action under the broader customs laws. The penalties for such actions could range from fines to imprisonment, depending on the severity and intent behind the breach. It is important for all parties to adhere strictly to the guidelines and obligations set out to avoid any potential repercussions.