EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0944650
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.
Everwater Australia applied for a TCO in respect of certain pipe purging system on 24 November 2009.
Instrument
TCO No 0944650 was made on 29 January 2010. It declares that those certain pipe purging system 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. 0944650 is taken to have come into force on 24 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. 0944650, enacted under the Customs Act 1901, addresses the issue of applying tariff concessions to certain imported goods. This instrument was introduced to facilitate a reduction in the customs duty rate for specified goods, ensuring that these goods are subject to a lower rate of duty when they do not have substitutable counterparts produced in Australia. The enacting authority for this instrument is the Chief Executive Officer of Customs, who is mandated under section 269F of the Act to consider and approve applications for tariff concession orders (TCOs). The policy objective of this legislation is to support industries by providing tariff relief, thereby making imported goods more competitive with locally produced alternatives and potentially stimulating economic activity in sectors where Australia does not domestically produce the goods in question. The instrument was introduced without any adverse submissions, reflecting a consensus that the tariff relief would be beneficial without imposing undue liabilities on any parties.
Scope and Application
The Tariff Concession Instrument No. 0944650, made under the Customs Act 1901, applies to the reduction of customs duty for certain pipe purging systems. The instrument is applicable to any entity that imports these specific goods, allowing them to benefit from a lower rate of duty, or in this case, duty-free importation, as determined by the Chief Executive Officer of Customs. The instrument is effective from the date the application for the concession was lodged, which is 24 November 2009, and does not retroactively affect any import transactions prior to this date. The geographic and jurisdictional reach of this Act is Commonwealth, as it is administered by the federal authority of the Chief Executive Officer of Customs. There are no exclusions or exemptions specified in this particular instrument, but the Act generally excludes goods listed in section 269SJ of the Customs Act 1901. The scope of the Act can be further extended or modified through subordinate instruments, such as regulations, which may provide additional details or specific conditions for the application of tariff concessions.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0944650 (Section 269F) establish the procedure for applying for a Tariff Concession Order (TCO). Section 269C outlines the core criteria that must be met for the CEO to consider the application. If the CEO is satisfied that the application meets these criteria, as per Section 269P(3), they must make a written TCO. The TCO itself is detailed in Section 269S, which specifies the effective date of the concession and its application to the particular goods.
The obligations imposed by the Act on parties include ensuring that any application for a TCO is lodged in accordance with the requirements set out in Section 269F. The CEO, as per Section 269K(1), has an obligation to publish a notice in the Gazette inviting submissions from any interested parties. This transparency measure allows for any objections or submissions to be considered before the TCO is finalised. Furthermore, the CEO must verify that the core criteria in Section 269C are met before issuing the TCO.
Should any party fail to comply with the obligations set out in the Act, there may be significant consequences. For instance, if an entity fails to properly apply for a TCO or provides misleading information, this could be considered an offence. While the specific penalties are not detailed in the explanatory statement, breaches of similar provisions in related legislation often result in substantial fines and potential legal action. The penalties can vary but may include fines up to a certain monetary amount as determined by relevant statutes. Additionally, there could be civil or administrative penalties for non-compliance, which might further include restitution or compensation for any losses incurred due to the breach.