EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0918399
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.
ACO Polycrete applied for a TCO in respect of certain rails channel protectors on 29 May 2009.
Instrument
TCO No 0918399 was made on 21 August 2009. It declares that those certain rails channel protectors 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. 0918399 is taken to have come into force on 29 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 Tariff Concession Instrument No. 0918399, enacted under the Customs Act 1901, addresses the need for tariff concessions on specific goods to foster economic efficiency and competitiveness in the Australian market. This instrument, issued by the Chief Executive Officer of Customs, was designed to lower the customs duty for certain rails channel protectors, effective from 29 May 2009, the date the application was lodged. The primary objective is to ensure that the application for tariff concessions adheres to the criteria set by the Act, specifically that no substitutable goods were produced in Australia at the time of the application, thus ensuring that the concessions do not undermine local production. The instrument was introduced without any submissions opposing it, reflecting a smooth process and potentially broad acceptance of the tariff reductions.
Scope and Application
The Tariff Concession Instrument No. 0918399 under the Customs Act 1901 applies to entities or individuals seeking a tariff concession order (TCO) for certain goods imported into Australia. The scope of the Act encompasses the application process for TCOs, which is initiated by an application to the Chief Executive Officer of Customs (CEO) by any person, as per section 269F of the Act. The application is subject to the core criteria outlined in sections 269C and 269SJ of the Act, particularly focusing on whether substitutable goods are produced in Australia in the ordinary course of business. If the CEO determines that no such goods are produced domestically, they must issue a TCO, as per section 269P(3), which declares the specific goods to which a reduced customs duty rate applies. This instrument extends to the national jurisdiction of Australia and affects the importation of specified goods, as indicated by the application for certain rails channel protectors.
The geographic and jurisdictional reach of this Act is national, applying to all entities involved in the importation of goods within Australia. The application process involves public consultation, as stipulated in section 269K(1) of the Act, although in this case, no submissions were received. The TCO is effective from the date the application was lodged, on 29 May 2009, and does not retroactively affect the rights or impose liabilities on persons other than the Commonwealth. Importers, however, benefit from the ability to claim a refund of duty on goods imported since the effective date of the TCO, as provided under paragraph 126(1)(r) of the Regulations. The application of the Act is further extended through subordinate instruments that may specify additional criteria or details regarding the TCO process.
Key Provisions
The key operative sections of the Tariff Concession Instrument No. 0918399 under the Customs Act 1901 (the Act) include section 269C, which sets out the core criteria for approving a Tariff Concession Order (TCO). This section requires that, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business (s 269C). Further, section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a TCO in respect of goods. If the CEO is satisfied that the application meets the criteria, they must make a written order (a TCO) declaring that the goods are subject to a specified item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff) (s 269P(3)).
The obligations imposed by the Act on parties include the requirement for the CEO to assess whether an application for a TCO meets the core criteria (s 269C). If the application is for goods that are not specified in section 269SJ of the Act, which lists those goods that cannot be subject to a TCO, the CEO must determine whether the application meets the criteria based on whether substitutable goods were produced in Australia (s 269P(3)). Additionally, subsection 269K(1) mandates that the CEO publish a notice in the Gazette inviting submissions from interested parties if they consider there are reasons why the TCO should not be made.
There are no specific offences or penalties outlined for breaches of the provisions in this Instrument. However, any failure to comply with the requirements of the Customs Act 1901 could potentially lead to enforcement actions under other provisions of the Act or related legislation. The CEO's decision-making process is guided by the statutory criteria, and any failure to follow these criteria could result in the TCO being subject to judicial review or other administrative action. It is also important to note that the TCO does not affect the rights of persons (other than the Commonwealth) as at the date of registration and does not impose any liabilities on any person.