EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0932752
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.
Crane Copper Tube applied for a TCO in respect of certain copper alloy tube fittings on 3 September 2009.
Instrument
TCO No 0932752 was made on 8 January 2010. It declares that those certain copper alloy tube fittings 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. 0932752 is taken to have come into force on 3 September 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 and excise duties, and provides a mechanism for tariff concession orders (TCOs). This Act aims to facilitate the importation of goods by granting lower rates of customs duty where appropriate. Specifically, under section 269F, the Chief Executive Officer of Customs can make a TCO, which applies a lower duty rate to goods that meet certain criteria. In this context, TCO No. 0932752 was introduced to provide tariff concessions on certain copper alloy tube fittings, as applied for by Crane Copper Tube on 3 September 2009. The policy objective is to ensure that such concessions are granted only where no substitutable goods are produced domestically, thereby encouraging the importation of goods that are not readily available within Australia. This approach is intended to benefit importers by potentially reducing their duty liabilities.
Scope and Application
The Tariff Concession Order No. 0932752 under the Customs Act 1901 applies to the specific category of copper alloy tube fittings, as identified by Crane Copper Tube, which were subject to the application for tariff concession. The Act applies to these goods by granting them a lower rate of customs duty through the issuance of the Tariff Concession Order. The geographic reach of this legislation is national, as it pertains to the Commonwealth of Australia. The application of the Act extends to any person or entity importing the specified copper alloy tube fittings into Australia, thus impacting the import industry and the conduct related to these goods. The Act does not specify any exclusions, exemptions, or thresholds for the application of the tariff concession, other than those outlined in section 269SJ which prohibits certain goods from being subject to a Tariff Concession Order. The Act's application can be further extended or restricted through subordinate instruments, such as regulations or further orders, which may specify additional conditions or details regarding the implementation and scope of the tariff concessions.
Key Provisions
The main operative sections of the Customs Act 1901, as outlined in Tariff Concession Instrument No. 0932752, focus on the application and creation of Tariff Concession Orders (TCOs) (sections 269C, 269F, and 269P). Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO concerning certain goods. If the CEO determines that the application meets the core criteria, as defined by section 269C, and that the goods are not listed in section 269SJ, a TCO is made under section 269P. This TCO lowers the rate of customs duty on the specified goods.
The Act imposes specific obligations on the parties involved. The CEO of Customs must ensure that no substitutable goods are produced in Australia when assessing a TCO application (section 269C). Once the CEO accepts an application, a notice must be published in the Gazette inviting submissions from any interested parties (subsection 269K(1)). The CEO must consider any submissions before making a final decision. Additionally, the Act mandates that the TCO does not disadvantage any person other than the Commonwealth or impose liabilities on them for actions taken before the TCO's effective date (subsection 269S(1)).
In terms of penalties and consequences, the Act does not explicitly outline specific offences or penalties for non-compliance with TCO provisions. However, it does state that the TCO does not impose liabilities on any person (subsection 269S(1)). The Act provides for refunds of duty for importers of goods affected by the TCO under paragraph 126(1)(r) of the Regulations, thus ensuring that importers benefit from the tariff concessions without incurring any liabilities for past transactions.