EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0918950
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.
Woodside Burrup Pty Ltd applied for a TCO in respect of certain Christmas tree handling tools on 04 June 2009.
Instrument
TCO No 0918950 was made on 28 August 2009. It declares that those certain Christmas tree handling tools 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. 0918950 is taken to have come into force on 04 June 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, includes provisions for the establishment of Tariff Concession Orders (TCOs) to provide relief from customs duties on certain goods under specific conditions. This legislation was introduced to address the need for a streamlined process to allow for reduced customs duties on goods where appropriate, particularly in cases where no substitutable goods are produced in Australia. The Customs Act 1901 facilitates these concessions through section 269F, which allows for applications to the Chief Executive Officer of Customs (CEO) for a TCO. The policy objective is to encourage the importation of goods that are not produced domestically, thereby supporting trade and potentially lowering costs for businesses and consumers. The explanatory statement for Tariff Concession Instrument No. 0918950, made under this Act, details a specific instance where certain Christmas tree handling tools were granted a tariff concession, reducing their duty from 5% to free, following a successful application by Woodside Burrup Pty Ltd.
Scope and Application
The Tariff Concession Instrument No. 0918950, made under the Customs Act 1901, applies to the specific case of certain Christmas tree handling tools submitted by Woodside Burrup Pty Ltd. This instrument is tailored to the particular goods identified in the application and does not extend to any other goods or entities unless similarly applied for and approved. The Act allows the Chief Executive Officer of Customs to issue a Tariff Concession Order (TCO) if the core criteria are met, specifically that no substitutable goods are produced in Australia in the ordinary course of business. The TCO instrument, which came into effect on the date of the application, 4 June 2009, alters the customs duty rate for the specified goods, reducing it from the general rate of 5% to free, benefiting the rights of importers who can apply for duty refunds for goods imported since the TCO's effective date. This legislation operates at the Commonwealth level and does not impose any liabilities on persons other than the Commonwealth, nor does it disadvantage anyone with rights as of the registration date by affecting actions taken before that date.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0918950 (the Instrument) under the Customs Act 1901 are sections 269F, 269C, 269P(3), and 269K(1). Section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a Tariff Concession Order (TCO) in respect of goods. If the CEO determines that the application meets the core criteria set out in section 269C, and no substitutable goods are produced in Australia, the CEO must make a written order as per section 269P(3). This order specifies that the goods in question are subject to a prescribed rate of duty, which in this case is free. Section 269K(1) mandates that the CEO publish a notice in the Gazette inviting submissions from any person who believes the TCO should not proceed, although in this instance, no submissions were received.
The Act imposes certain obligations on the parties involved. The applicant, in this case Woodside Burrup Pty Ltd, must ensure their application for a TCO is valid and meets the criteria outlined in section 269C of the Act. The CEO is obligated to review the application, assess whether it meets the core criteria, and if so, to make a written TCO. The CEO must also publish a notice in the Gazette inviting any relevant submissions, although it appears from this case that no objections were lodged. The CEO's decision to grant or deny the TCO must be based on the statutory criteria and any submissions received.
Under the Customs Act 1901, breaches of the provisions related to the issuance and operation of a TCO could lead to various legal consequences. If a TCO is made in error, for example by not adhering to the statutory criteria, the TCO could be subject to judicial review. The Act does not explicitly outline penalties for such breaches; however, the consequences could include the revocation of the TCO and potential financial repercussions for any party that has benefited improperly from the concession. The general legal framework for such breaches may include administrative penalties, fines, or other corrective measures as deemed necessary by the court.