EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0910617
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.
Boronia Technologies applied for a TCO in respect of certain copper tubing on 30 March 2009.
Instrument
TCO No 0910617 was made on 19 June 2009. It declares that those certain copper tubing 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. 0910617 is taken to have come into force on 30 March 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. 0910617 was enacted in 2009 under the Customs Act 1901, aiming to address the need for tariff concessions on specific goods imported into Australia. This legislation enables the Chief Executive Officer of Customs to provide tariff relief by reducing customs duty rates on certain goods through the creation of Tariff Concession Orders (TCOs). The primary objective of this instrument is to provide a streamlined process for businesses to apply for tariff concessions, facilitating more efficient trade practices by lowering the cost of imported goods. The process includes a mechanism for public consultation to ensure transparency and fairness in the decision-making process regarding tariff concessions.
The enacting body responsible for this legislation is the Australian Parliament, which established the framework for tariff concessions to foster economic growth and support industry competitiveness by providing relief from customs duties on specific imported goods. The policy objective is to ensure that Australian businesses can access necessary imported goods at a reduced cost, thereby enhancing their ability to compete in the global market. This approach helps to mitigate the financial burden on businesses and consumers while promoting economic activity.
Scope and Application
The Tariff Concession Instrument No. 0910617, enacted under the Customs Act 1901, applies to the specific entity that applied for the tariff concession, Boronia Technologies, and concerns the particular goods for which the concession was sought, certain copper tubing. The application and subsequent concession pertain to the importation of these goods, allowing them to benefit from a reduced or free rate of customs duty as outlined in item 50 of Schedule 4 to the Customs Tariff Act 1995. This Act operates at the Commonwealth level, providing a legislative framework for customs duties and tariff concessions across Australia. Notably, the legislation excludes any goods specified in section 269SJ of the Customs Act 1901, which lists those ineligible for tariff concessions. The application process requires that no substitutable goods are produced in Australia in the ordinary course of business, ensuring that the concession is granted only in appropriate circumstances. The instrument extends its application through subordinate instruments by specifying the precise goods and the applicable tariff concession, thereby ensuring that the terms of the concession are clearly defined and implemented.
Key Provisions
The Tariff Concession Instrument No. 0910617, made under section 269P(3) of the Customs Act 1901, declares that certain copper tubing is eligible for a tariff concession order (TCO), effective from 30 March 2009 (subsection 269S(1)). Section 269P(3) specifies that the CEO must make a written order if satisfied that the application meets the core criteria, which is that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (section 269C). This means that the CEO must ensure that there are no equivalent goods produced domestically that could substitute for the imported goods. If these conditions are met, the CEO issues a TCO, as was done in this instance on 19 June 2009.
The obligations imposed by this Act on the parties involved include the requirement for the CEO to assess whether a TCO application meets the core criteria (section 269C). The applicant, in this case Boronia Technologies, must provide all necessary information to support their application, ensuring it complies with the conditions outlined in the Act. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any interested parties who may have reasons to oppose the TCO (subsection 269K(1)). If no submissions are received, as in this case, the CEO proceeds with the order. The CEO also has the responsibility to ensure that the TCO does not disadvantage any person or impose liabilities on them in respect of actions taken before the order’s effective date (subsection 269S(1)).
Breaches of the conditions set out in the Customs Act 1901 may lead to various civil or criminal consequences. While the specific offences and penalties are not detailed in the explanatory statement, under Australian law, breaches of customs regulations can typically result in substantial fines and, in severe cases, imprisonment. The Act provides for penalties under sections such as 245 and 246, which generally involve fines up to a significant amount, depending on the nature and severity of the breach. It is important for all parties to adhere to the requirements of the Act to avoid these potential consequences.