EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0943498
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.
Beckman Coulter Australia Pty Ltd applied for a TCO in respect of certain laboratory processing systems on 17 November 2009.
Instrument
TCO No 0943498 was made on 05 February 2010. It declares that those certain laboratory processing systems 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. 0943498 is taken to have come into force on 17 November 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. 0943498, enacted under the Customs Act 1901, was introduced to address the issue of providing tariff concessions on certain goods, specifically in this case, certain laboratory processing systems, thereby reducing the customs duty rate for these goods. This instrument was enacted by the Chief Executive Officer of Customs (CEO) in response to an application from Beckman Coulter Australia Pty Ltd, dated 17 November 2009, seeking a tariff concession order (TCO) for their specified goods. The core objective, as outlined in the Act, is to ensure that if no substitutable goods are produced in Australia, the CEO must make a written order, declaring the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies, effectively setting the rate of duty for these goods to free. The instrument came into force on the same day as the application was lodged, which was 17 November 2009.
Scope and Application
The Tariff Concession Instrument No. 0943498 under the Customs Act 1901 applies to any person or entity seeking to import specified goods, namely certain laboratory processing systems, into Australia. The Act mandates that the Chief Executive Officer of Customs (CEO) must consider applications for Tariff Concession Orders (TCOs) to determine if they meet core criteria, which include ensuring that no substitutable goods are produced in Australia in the ordinary course of business. This legislation aims to provide relief by applying a lower rate of customs duty, or in some cases, making the goods duty-free if the criteria are satisfied. The geographical scope of this Act is national, as it pertains to the importation of goods into Australia, and the jurisdictional reach is under Commonwealth law. The Act does not impose any liabilities or disadvantage existing rights of persons other than the Commonwealth, and it allows for importers to apply for duty refunds for goods imported since the effective date of the TCO. The Act’s application may be extended or restricted through subordinate instruments, ensuring flexibility in administering tariff concessions as required.
Key Provisions
The key provisions of the Tariff Concession Instrument No. 0943498 revolve around the application and implementation of a Tariff Concession Order (TCO) under the Customs Act 1901 (section 269F). Specifically, section 269C outlines the core criteria for a TCO application, which must be satisfied by the Chief Executive Officer (CEO) of Customs, including that no substitutable goods were produced in Australia on the day the application was lodged (section 269P(3)). If these criteria are met, the CEO must issue a written order (section 269P(3)) specifying that the goods in question are subject to a reduced rate of customs duty, as per item 50 of Schedule 4 to the Customs Tariff Act 1995, with the general rate being 5% and the concessional rate being free.
The Act imposes several obligations on parties involved. For instance, applicants like Beckman Coulter Australia Pty Ltd must ensure their applications meet the core criteria, particularly demonstrating that no substitutable goods are produced in Australia (section 269C). The CEO, on the other hand, has the duty to evaluate applications promptly and decide whether they meet the specified criteria (section 269P(3)). Additionally, the CEO must publish a notice in the Gazette inviting submissions from any interested parties (subsection 269K(1)), although no submissions were received in this case.
In terms of consequences for non-compliance or breaches, the Act does not specify criminal offences or penalties directly related to the TCO process. However, failure to adhere to the stipulated criteria or obligations could indirectly result in financial repercussions, such as the imposition of the higher duty rate if the CEO determines that the criteria for a TCO are not met. The Act ensures that the TCO does not affect the rights of individuals adversely, nor does it impose new liabilities on persons other than the Commonwealth (subsection 269S(1)). It also provides a mechanism for importers to apply for a refund of duty paid on goods imported since the TCO was taken to have come into force (paragraph 126(1)(r) of the Regulations).