EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0930935
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.
South Australian Water Corporation applied for a TCO in respect of certain wasterwater odour control plant on 24 August 2009.
Instrument
TCO No 0930935 was made on 06 November 2009. It declares that those certain wasterwater odour control plant 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. 0930935 is taken to have come into force on 24 August 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. 0930935, enacted in 2009, pertains to the Customs Act 1901 and addresses the need for tariff concessions for specific goods that are not produced in Australia in the ordinary course of business. The Customs Act 1901 allows the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) to lower the rate of customs duty for goods that meet certain criteria, particularly where no substitutable goods are produced domestically. In this instance, the South Australian Water Corporation applied for a TCO for wastewater odour control plant, which was granted as no substitutable goods were produced in Australia. The instrument came into effect on the date of application, 24 August 2009, and provides a free rate of duty for these specified goods, benefiting importers who can apply for duty refunds for imports made from this date. The policy objective here is to facilitate the import of goods that are not domestically produced, thereby supporting specific needs and potentially lowering costs for businesses and consumers.
Scope and Application
The Customs Act 1901, through Part XVA, facilitates the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This process allows for the application of a lower rate of customs duty to specific goods when certain conditions are met. A TCO can be applied for by any person, but the application must not pertain to goods specified in section 269SJ, which outlines those goods ineligible for a TCO. If an application is deemed to meet the core criteria under sections 269B and 269C, the CEO must proceed to make the order. The TCO scheme applies nationally, affecting the rights of importers by potentially allowing them to claim refunds on duty paid on goods imported since the TCO's effective date, without imposing any liabilities on persons other than the Commonwealth. The application of this Act is not restricted by geographic or jurisdictional boundaries, extending to all entities and individuals within the Commonwealth of Australia.
Key Provisions
The Tariff Concession Order (TCO) No. 0930935 under the Customs Act 1901 (section 269F) is an instrument that the Chief Executive Officer of Customs (CEO) issues to provide tariff concessions on specific goods. In this case, the CEO has declared that certain wastewater odour control plant are goods to which item 50 of Schedule 4 to the Customs Tariff Act 1995 applies, effectively setting the duty rate for these goods at free, down from the general rate of 5% (section 269P(3)). This concession applies because the CEO was satisfied that no substitutable goods were produced in Australia at the time the application was lodged, meeting the core criteria outlined in section 269C.
The obligations under this TCO primarily revolve around the application process and the criteria for issuing such concessions. An applicant must submit a valid application to the CEO, who must then determine if the application meets the core criteria (section 269C). If the CEO finds that no substitutable goods are produced in Australia and that the application is not in respect of goods specified in section 269SJ, they are required to issue the TCO. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any interested parties (subsection 269K(1)), although in this case, no submissions were received.
In terms of consequences for non-compliance, while the explanatory statement does not explicitly mention offences or penalties, it is reasonable to infer that failure to adhere to the requirements of the TCO or the Customs Act could lead to legal repercussions. These might include civil or criminal penalties for incorrect declaration of goods, fraud, or other breaches of customs regulations. The specifics of these penalties would depend on the particular breaches and relevant sections of the Customs Act and associated regulations.
The TCO does not affect the rights of any person other than the Commonwealth as at the date of registration, ensuring that no one is disadvantaged or imposed with new liabilities regarding actions taken before the TCO was issued (subsection 269S(1)). Importers of the affected goods can apply for a refund of duty paid on imports since the TCO was taken to have come into force (paragraph 126(1)(r) of the Regulations). This provision ensures that the benefits of the TCO are passed on to those importing the specified goods, without placing additional burdens on any party.