EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0946616
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.
Rio Tinto Aluminium applied for a TCO in respect of certain water distribution sprayers on 08 January 2009.
Instrument
TCO No 0946616 was made on 03 April 2009. It declares that those certain water distribution sprayers 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. 0946616 is taken to have come into force on 08 January 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. 0946616 was introduced under the Customs Act 1901 to address a specific gap in the tariff concession scheme, ensuring that certain goods not produced in Australia can benefit from reduced customs duty rates. Enacted in 2009, the instrument enables the Chief Executive Officer of Customs to grant tariff concessions on goods that do not have Australian substitutes, thereby encouraging the importation of these goods. This initiative was undertaken by the CEO in response to an application from Rio Tinto Aluminium for certain water distribution sprayers. The policy objective behind this measure is to foster the availability of goods that are not domestically produced, thereby benefiting importers and potentially lowering costs for end consumers. The instrument came into force on the date the application was lodged, 8 January 2009, and ensures that no existing rights or liabilities of non-Commonwealth entities are adversely affected.
Scope and Application
The Tariff Concession Instrument No. 0946616, made under the Customs Act 1901, applies to specific goods, in this case, certain water distribution sprayers, and pertains to the reduction or exemption of customs duties on these goods. This instrument is applicable to any person or entity importing these goods, thereby potentially benefiting importers by reducing their customs duty liabilities. The geographic and jurisdictional reach of this Act is Commonwealth, meaning it applies across Australia as part of the national customs framework. The Act allows for the application of tariff concession orders by the Chief Executive Officer of Customs, provided the goods do not fall under the exclusions specified in section 269SJ of the Customs Act 1901, which includes certain prohibited or restricted goods. The application process and criteria for approval are detailed within sections 269C, 269D, 269E, and 269P of the Act, ensuring a structured approach to determining the eligibility of goods for tariff concessions. Additionally, the Act mandates consultation with the public through a notice in the Gazette, inviting submissions on the proposed concession; however, in this instance, no submissions were received. The commencement of this tariff concession is effective from the date the application was lodged, 08 January 2009, and it does not retroactively affect the rights or liabilities of any person other than the Commonwealth.
Key Provisions
The key operative sections of this legislation pertain to Tariff Concession Orders (TCOs) under Part XVA of the Customs Act 1901 (section 269F). When a person applies for a TCO in respect of goods (section 269F), the Chief Executive Officer of Customs (CEO) is required to consider the application and determine whether it meets the core criteria (section 269C). If the CEO is satisfied that the application meets the core criteria, they must make a written order (section 269P(3)). In this case, TCO No. 0946616 was made on 03 April 2009, declaring that certain water distribution sprayers are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies, thus granting them a duty-free status (section 269P(3)). The TCO came into force on the date the application was lodged, 08 January 2009 (subsection 269S(1)).
The Customs Act 1901 imposes several obligations and requirements on the parties involved in the TCO process. The CEO is required to publish a notice in the Gazette, inviting any interested parties to submit their views on the application for a TCO (subsection 269K(1)). The CEO must also ensure that the application does not pertain to goods specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. Furthermore, the CEO must assess whether no substitutable goods were produced in Australia on the day the application was lodged (section 269C). If the CEO is satisfied that the application meets the core criteria, they must make a written TCO (section 269P(3)).
There are no specific offences, penalties, or civil/criminal consequences outlined for breaches of the TCO provisions in the Customs Act 1901. However, the Act does state that 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 (subsection 269S(1)). The rights of importers will be beneficially affected, and they 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 (paragraph 126(1)(r) of the Regulations). The TCO does not impose any liabilities on any person.