EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0927024
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.
Simplot Australia applied for a TCO in respect of certain pea and broad beans harvesters on 27 July 2009.
Instrument
TCO No 0927024 was made on 09 October 2009. It declares that those certain pea and broad beans harvesters 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. 0927024 is taken to have come into force on 27 July 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. 0927024, enacted under the Customs Act 1901, was introduced to address the issue of applying lower rates of customs duty to specific goods that are not produced domestically and for which no suitable domestic substitutes exist. This instrument allows the Chief Executive Officer of Customs to issue Tariff Concession Orders (TCOs) that effectively exempt certain goods from the usual customs duty rates, thereby promoting trade and economic efficiency. The policy objective underpinning this legislation is to encourage the import of goods that cannot be locally manufactured, ensuring that businesses and consumers benefit from reduced costs without compromising the availability of essential goods.
This instrument was enacted by the relevant legislature, with the Tariff Concession Order No. 0927024 specifically concerning pea and broad beans harvesters, which were granted a duty-free status. The process involved a public consultation period where no objections were raised, thereby allowing the order to proceed without any adverse impacts on existing rights or liabilities. The TCO came into effect on the date the application was lodged, providing immediate benefits to importers who can now apply for refunds on duties paid prior to the order's implementation.
Scope and Application
The Tariff Concession Instrument No. 0927024 under the Customs Act 1901 applies to goods, specifically pea and broad beans harvesters, for which a Tariff Concession Order (TCO) has been approved by the Chief Executive Officer of Customs. This instrument is designed to facilitate lower customs duty rates for these particular goods, provided that no substitutable goods are produced in Australia in the ordinary course of business. The legislation primarily affects importers of the specified harvesters by offering them a tariff concession that was not previously available, thus allowing them to benefit from duty-free importation of these goods. The application of this Act is jurisdictional, as it is enacted under the Commonwealth of Australia. It does not apply to goods specified in section 269SJ of the Customs Act 1901, which lists goods that are ineligible for TCOs. The commencement of the TCO coincides with the date the application was lodged, and it does not disadvantage any person or impose new liabilities on anyone, except that it allows for a refund of duty on goods imported since the effective date of the TCO.
Key Provisions
The Tariff Concession Instrument No. 0927024, under the Customs Act 1901, sets out specific provisions regarding the application and issuance of Tariff Concession Orders (TCOs). Section 269F (1) of the Act allows for an application to be made to the Chief Executive Officer of Customs (CEO) for a TCO. If the CEO determines that the application pertains to goods not excluded under section 269SJ and meets the core criteria outlined in section 269C, a TCO will be issued. The core criteria require that, on the date the application was submitted, no substitutable goods were produced in Australia in the ordinary course of business (section 269C).
The obligations under this legislation require that if the CEO is satisfied that the application for a TCO meets the core criteria, they must issue a written order (section 269P(3)). This order specifies that the goods in question are subject to a particular item of Schedule 4 to the Customs Tariff Act 1995, thereby applying a prescribed duty rate. In the case of TCO No. 0927024, certain pea and broad bean harvesters are subject to a duty rate of free, as opposed to the general rate of 5%. Additionally, the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting submissions from any person who believes the TCO should not be made (subsection 269K(1)).
In terms of consequences, the legislation does not impose any liabilities on any person (other than the Commonwealth) in respect of anything done or omitted to be done before the date of registration of the TCO (subsection 269S(1)). However, importers of the goods in question will be able to apply for a refund of duty on goods imported since the day the TCO is taken to have come into force (paragraph 126(1)(r) of the Regulations). There are no specified offences, penalties, or civil/criminal consequences mentioned in the text for breaches of the TCO provisions.