EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0917315
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.
Callide Oxyfuel Services applied for a TCO in respect of certain carbon dioxide purification units on 21 May 2009.
Instrument
TCO No 0917315 was made on 19 October 2009. It declares that those dioxide purification units 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. One submission objecting to the TCO application was received from Wilson Transformer Co Pty Ltd.
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. 0917315 is taken to have come into force on 21 May 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 customs duties and the import and export of goods. The Act includes provisions for Tariff Concession Orders (TCOs) under Part XVA, which allow for the application of lower rates of customs duty on specified goods. This mechanism was introduced to address the need for flexibility in tariff applications to support economic efficiency and international competitiveness by enabling the exemption of certain goods from standard duty rates if specific conditions are met. The Tariff Concession Instrument No. 0917315, made on 19 October 2009, exemplifies this process by granting a tariff concession to Callide Oxyfuel Services for certain carbon dioxide purification units, effectively setting the duty rate at free, thereby reducing the financial burden on the importer of these goods. This legislative tool aims to facilitate smoother trade operations by aligning with the policy objective of promoting economic activity through targeted tariff relief.
Scope and Application
The Tariff Concession Instrument No. 0917315 under the Customs Act 1901 applies specifically to certain carbon dioxide purification units, as requested by Callide Oxyfuel Services. This legislation concerns entities that seek tariff concessions for specific goods imported into Australia, allowing them to benefit from reduced or no customs duty rates. The Act applies to the Commonwealth and all entities involved in the importation of goods, particularly those who apply for and receive a Tariff Concession Order (TCO) from the Chief Executive Officer of Customs. The geographic reach of this Act is national, as it pertains to the importation of goods into Australia. The Act excludes goods specified in section 269SJ, which are ineligible for a TCO, and applies to any application made under section 269F of the Act that meets the core criteria outlined in sections 269C, 269B, and 269D of the Customs Act 1901. The TCO itself, once issued, takes effect from the date of the application, as specified in subsection 269S(1) of the Act, and does not affect any existing rights or impose new liabilities on persons other than the Commonwealth.
Key Provisions
The primary operative sections of Tariff Concession Instrument No. 0917315 under the Customs Act 1901 (section 269F) allow for the application of a Tariff Concession Order (TCO) to reduce the customs duty on specific goods. Section 269C specifies that a TCO application meets the core criteria if no substitutable goods were produced in Australia at the time the application was lodged. Section 269B and 269D further define terms such as "goods produced in Australia," "ordinary course of business," and "substitutable goods." If the Chief Executive Officer of Customs (CEO) is satisfied that these criteria are met, they must make a written TCO (section 269P(3)), which in this case, pertains to carbon dioxide purification units and applies item 50 of Schedule 4 to the Customs Tariff Act 1995.
The obligations imposed by the Act on parties and entities governed by it include the requirement for applicants to ensure their applications meet the core criteria (section 269C), and the CEO's duty to assess these applications. The CEO must also publish a notice in the Gazette inviting objections to a TCO application as soon as practicable after accepting it as valid (subsection 269K(1)). Additionally, the CEO must consider any submissions received and decide whether to proceed with the TCO. The Act ensures that the TCO does not affect the rights of persons (other than the Commonwealth) as at the date of registration so as to disadvantage them or impose liabilities on them in respect of anything done or omitted to be done before the date of registration (subsection 269S(1)).
In terms of offences, penalties, or civil/criminal consequences for breach, the Customs Act 1901 does not explicitly state maximum penalties within this particular context. However, general provisions of the Act and associated regulations may apply to breaches of customs duties or other related obligations, which could include fines and imprisonment. For instance, under the Crimes Act 1914, any person who wilfully or recklessly contravenes a provision of the Customs Act 1901 may be subject to penalties. The specific consequences would depend on the nature and severity of the breach, and the relevant provisions of the Act and associated regulations.