EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0910797
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.
Waterform Technologies applied for a TCO in respect of certain wastewater foam skimmers on 31 March 2009.
Instrument
TCO No 0910797 was made on 19 June 2009. It declares that those certain wastewater foam skimmers 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. 0910797 is taken to have come into force on 31 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. 0910797, enacted in 2009 under the Customs Act 1901, aims to provide tariff concessions for certain goods by the Chief Executive Officer of Customs. This legislative instrument addresses the gap in providing lower customs duty rates for specific goods that meet the core criteria set out in the Act, such as those not being substitutable by goods produced in Australia in the ordinary course of business. The enacting body, the Chief Executive Officer of Customs, ensures that applications for tariff concession orders are processed according to the statutory provisions outlined in the Customs Act, enhancing the efficiency and effectiveness of the customs duty regime.
This instrument was developed to facilitate the concession for certain wastewater foam skimmers, as per the application by Waterform Technologies, and was enacted without any submissions opposing the concession, reflecting the policy objective of streamlining customs processes while ensuring no adverse impacts on rights or liabilities predating the registration of the order. The tariff concession effectively benefits importers by potentially allowing them to apply for refunds of duty paid on the specified goods from the date the order came into force.
Scope and Application
The Customs Act 1901, specifically under Part XVA, provides a framework for the creation of Tariff Concession Orders (TCO) by the Chief Executive Officer of Customs. This legislation applies to applications for tariff concessions in respect of goods, ensuring that the orders are made when certain core criteria are met. These criteria include the absence of substitutable goods produced in Australia in the ordinary course of business at the time the application is lodged. The TCO mechanism is designed to benefit importers by providing them with the opportunity to apply for a refund of duty on goods imported since the TCO is taken to have come into force, without imposing any liabilities on any person. The scope of the Act applies to the Commonwealth, and it extends to any goods that are not specified in section 269SJ of the Act, which excludes certain goods from being subject to a TCO. The Act’s application is further clarified by the Customs Tariff Act 1995, which specifies the rates of duty applicable to the goods subject to the TCO. The TCO does not affect any existing rights of a person other than the Commonwealth in a manner that would disadvantage them or impose liabilities for actions taken prior to the registration of the TCO.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0910797 pertain to the declaration of certain wastewater foam skimmers as goods subject to a Tariff Concession Order (TCO) under section 269P(3) of the Customs Act 1901 (section 269P(3)). This section requires that if the Chief Executive Officer of Customs (CEO) is satisfied that no substitutable goods were produced in Australia on the day the application was lodged, they must make a written order declaring the goods to which a specified item of Schedule 4 to the Customs Tariff Act 1995 applies. In this case, the CEO declared that the wastewater foam skimmers are subject to item 50 of Schedule 4, which applies a duty rate of free instead of the general rate of 5%.
The Act imposes certain obligations on parties involved with the TCO. For instance, section 269K(1) requires the CEO to publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made. In this instance, the CEO published the notice but did not receive any submissions. Additionally, section 269S(1) specifies that the TCO is effective from the date the application was lodged, which was 31 March 2009 for this particular TCO.
There are no specific offences, penalties, or consequences outlined in the explanatory statement for breach of the TCO or the Act as it pertains to this specific instrument. However, it is important to note that the Act generally provides for various offences and penalties for breaches of customs regulations, which may apply in different contexts. The consequences of non-compliance with customs laws can include fines and imprisonment, depending on the severity of the breach. It is advisable to consult the full text of the Customs Act 1901 for a comprehensive understanding of the potential penalties and enforcement mechanisms.