EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0943735
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.
Inoxihp Australia applied for a TCO in respect of certain positive displacement pumps on 19 November 2009.
Instrument
TCO No 0943735 was made on 29 January 2010. It declares that those certain positive displacement pumps 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. 0943735 is taken to have come into force on 19 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. 0943735 was enacted under the Customs Act 1901, and it addresses the need for tariff concessions for certain goods that are not produced in Australia. The instrument was created in response to an application by Inoxihp Australia for tariff concessions on specific positive displacement pumps, which were not being produced domestically. The Customs Act 1901 establishes a framework for Tariff Concession Orders (TCOs), allowing the Chief Executive Officer of Customs to grant lower customs duty rates on goods that meet specific criteria. The Tariff Concession Instrument No. 0943735 was published in the Gazette, inviting submissions, but none were received, leading to the instrument's enactment on 29 January 2010. The instrument declares that the certain positive displacement pumps are subject to a free duty rate, as no substitutable goods were produced in Australia. The instrument aims to benefit importers by allowing them to apply for a refund of duty on these goods since the date the TCO was taken to have come into force, without imposing any liabilities on any person.
Scope and Application
The Customs Act 1901 provides a framework for the administration of customs and excise duties in Australia, and under this Act, Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs to offer lower rates of customs duty on certain goods. The application for a TCO can be made by any person, but the order applies to specific goods that meet the criteria outlined in the Act. This includes ensuring that no substitutable goods are produced in Australia in the ordinary course of business on the day the application was lodged. The scope of the Act applies nationally, as it is a Commonwealth Act, and its application is not limited to specific industries or entities, but rather to any goods that meet the criteria for a tariff concession. The TCO No. 0943735, for example, applies to certain positive displacement pumps and was made effective from the date of the application, 19 November 2009. This instrument provides a free rate of duty on these specified goods, which contrasts with the general duty rate of 5%. The Act ensures that the TCO does not disadvantage any person by affecting their rights as at the date of registration or imposing liabilities for actions taken prior to the registration of the TCO.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0943735 under the Customs Act 1901 (the Act) include section 269F, which allows for applications to the Chief Executive Officer of Customs (the CEO) for Tariff Concession Orders (TCOs) in respect of goods. Section 269C sets out the core criteria that a TCO application must meet, specifically that on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269P(3) mandates that if the CEO is satisfied that the application meets the core criteria, a written order (the TCO) must be made. This specific TCO No. 0943735, issued on 29 January 2010, applies to certain positive displacement pumps and declares that these goods are subject to item 50 of Schedule 4 of the Customs Tariff Act 1995 (the Tariff), resulting in a free rate of duty instead of the general 5%.
The Act imposes several obligations and requirements on the parties it governs. For instance, section 269K(1) requires the CEO to publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made. Additionally, section 269S(1) specifies that a TCO is to be taken to have come into force on the day the application for the TCO was lodged, which in this case is 19 November 2009. The Act also ensures that the TCO does not affect the rights of any person (other than the Commonwealth) as at the date of registration, so as to disadvantage that person or impose liabilities in respect of anything done or omitted before the date of registration. Importers of the goods will be able to apply for a refund of duty on goods imported since the TCO came into force under paragraph 126(1)(r) of the Regulations.
The Act does not specify any direct offences, penalties, or civil/criminal consequences for breaches of the TCO provisions. However, the failure to comply with the conditions set out in the TCO or the Tariff could potentially lead to disputes or investigations by Customs, which might result in the imposition of duties or penalties as per the general provisions of the Customs Act 1901. Any non-compliance with the Act’s requirements for publishing notices and inviting submissions could also be subject to review or challenge under the Administrative Decisions (Judicial Review) Act 1977. It is essential for parties governed by the Act to adhere to these provisions to avoid any potential legal repercussions.