EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0949277
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.
Agnova Technologies applied for a TCO in respect of certain herbicides on 17 December 2009.
Instrument
TCO No 0949277 was made on 12 March 2010. It declares that those certain herbicides 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. 0949277 is taken to have come into force on 17 December 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 was amended to include Part XVA, which introduces a scheme for Tariff Concession Orders (TCOs) to be issued by the Chief Executive Officer of Customs. Enacted by the Parliament of Australia, this provision was introduced to address the need for tariff concessions on certain imported goods, ensuring that Australia can access goods that are not produced locally and thereby supporting economic efficiency and competitiveness. The policy objective is to facilitate the import of goods that are essential for Australian industries but not produced domestically, thereby lowering import costs and potentially reducing consumer prices. The explanatory statement details how Tariff Concession Order No. 0949277 was issued for certain herbicides, with the Customs Act 1901 providing the legislative framework under which these orders can be made, ensuring the process is transparent and subject to public consultation.
Scope and Application
The Tariff Concession Instrument No. 0949277 under the Customs Act 1901 applies specifically to certain herbicides as requested by Agnova Technologies. This instrument, issued by the Chief Executive Officer of Customs, provides a lower rate of customs duty for these specified goods, effectively reducing the duty from the general rate of 5% to free of charge. The instrument is designed to benefit importers who can now apply for a refund of duty on these goods imported since the date the application for the tariff concession was lodged. The Act applies to any individual or entity importing the specified herbicides, and its reach is national, as it pertains to the Commonwealth of Australia. Notably, the instrument does not affect the rights of any person other than the Commonwealth, ensuring that no existing liabilities or disadvantages are imposed on importers or any other parties prior to the registration date. The instrument was published in the Gazette to allow for any objections, though none were received, and it came into effect on the date the application was lodged, which was 17 December 2009.
Key Provisions
The main operative sections of this legislation are sections 269C, 269F, 269P, and 269S of the Customs Act 1901, which provide the framework for Tariff Concession Orders (TCOs). Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of goods. If the application meets the core criteria outlined in section 269C, which involves ensuring that no substitutable goods are produced in Australia in the ordinary course of business, the CEO must make a written order (TCO) (section 269P(3)). This order declares that the goods in question are subject to a lower rate of customs duty as specified in the Customs Tariff Act 1995.
The obligations imposed by the Act on the parties involved are primarily on the CEO of Customs. When an application for a TCO is submitted, the CEO must first verify that the application is valid and does not concern goods listed in section 269SJ, which are ineligible for TCOs. If the application is deemed valid, the CEO must then assess whether it meets the core criteria by confirming that no substitutable goods are produced in Australia. If these criteria are satisfied, the CEO must make the TCO and publish a notice in the Gazette, inviting any interested parties to submit objections. In this case, since no submissions were received, the CEO proceeded to issue TCO No. 0949277.
The legislation includes provisions for potential breaches and their consequences. Although the explanatory statement does not detail specific offences, the general framework of the Customs Act 1901 implies that any misuse or incorrect application of a TCO could lead to legal consequences. For example, falsely claiming eligibility for a TCO could be considered a fraudulent act under the Customs Act, potentially leading to penalties such as fines or imprisonment. The exact penalties would depend on the severity of the breach and could be determined under relevant sections of the Customs Act or other applicable laws.
In the specific case of TCO No. 0949277, the concession does not affect the rights of any person other than the Commonwealth, nor does it impose any liabilities on individuals or entities. Importers of the affected goods can benefit from this concession by applying for a refund of duty on goods imported since the TCO is deemed to have come into force. This is outlined under paragraph 126(1)(r) of the Regulations, which allows for duty refunds under certain conditions. The TCO ensures that no one other than the Commonwealth is disadvantaged or subjected to new liabilities as a result of its implementation.