EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1006218
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.
Syngenta Crop Protection applied for a TCO in respect of certain rodenticide on 04 February 2010.
Instrument
TCO No 1006218 was made on 23 April 2010. It declares that those certain rodenticide 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. 1006218 is taken to have come into force on 04 February 2010.
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 established a scheme under which Tariff Concession Orders (TCOs) could be made by the Chief Executive Officer of Customs (CEO). Enacted by the Parliament of Australia, this scheme was designed to address the need for tariff concessions for certain goods that do not have Australian-made equivalents. Such concessions aim to reduce customs duties for imported goods, thereby making them more affordable and accessible. The Tariff Concession Instrument No. 1006218, made on 23 April 2010, is an example of this legislative intent, as it granted a tariff concession for specific rodenticides, reducing their customs duty from 5% to free, effective from 4 February 2010. This instrument was introduced without any objections from the public, indicating broad support for the policy objective of facilitating the importation of essential goods that are not produced domestically.
Scope and Application
The Tariff Concession Instrument No. 1006218, issued under the Customs Act 1901, pertains to the application of Tariff Concession Orders (TCOs) for specific goods, in this case, certain rodenticides. The Act applies to any individual or entity that imports or intends to import the specified goods into Australia. The primary purpose of this instrument is to allow for a concession on the customs duty for these goods, effectively reducing the duty rate from the general rate of 5% to zero. The scope of the Act extends to the importation of goods and the application of customs duty, ensuring that the specified rodenticides are treated favourably in accordance with the provisions of Schedule 4 to the Customs Tariff Act 1995. The instrument's jurisdiction is under the Commonwealth, and it does not impose any disadvantages or liabilities on individuals or entities other than the Commonwealth for actions taken before the instrument's effective date. Additionally, the instrument does not apply to goods that are specified as ineligible for TCOs under section 269SJ of the Customs Act 1901. The application of this TCO is limited to the goods specified in the instrument and does not extend to other goods unless specifically included in subsequent TCOs.
Key Provisions
The Customs Act 1901, under Part XVA, provides the framework for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). Section 269F enables an individual to apply to the CEO for a TCO in respect of goods, provided that the goods are not specified in section 269SJ, which lists goods that cannot be subject to a TCO. The CEO's decision to grant a TCO hinges on whether the application meets the core criteria, as stipulated in section 269C. Specifically, the CEO must be satisfied that, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. This definition of 'substitutable goods' is given in section 269D, and the terms 'goods produced in Australia' and 'ordinary course of business' are defined in sections 269E and 269F respectively.
Entities subject to the Act must ensure their applications for TCOs are valid and that they meet the core criteria. The CEO's process involves accepting the application and publishing a notice in the Gazette, inviting any interested party to lodge a submission if they believe the TCO should not be made. If no submissions are received, the CEO proceeds to make the TCO. The Act mandates that the TCO is effective from the date the application was lodged, as outlined in section 269S(1). In this case, TCO No. 1006218, which was made on 23 April 2010, is considered effective from 4 February 2010, the date the application was lodged.
Breaches of the conditions set by the TCO may result in civil or criminal consequences. The Act does not specify particular offences or penalties for non-compliance with the TCO. However, any failure to adhere to the terms of the TCO could lead to disputes, and in severe cases, legal action could be taken against the non-compliant party. Importers, however, benefit from being able to apply for a refund of duty on goods imported since the TCO came into effect, as per paragraph 126(1)(r) of the Regulations. This provision ensures that the rights of importers are positively affected without imposing any new liabilities on them or other parties.