EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1010525
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.
Acciona Windpower Oceania Pty Ltd applied for a TCO in respect of certain wind powered generator blades on 01 March 2010.
Instrument
TCO No 1010525 was made on 21 May 2010. It declares that those certain wind powered generator blades 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. 1010525 is taken to have come into force on 01 March 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, enacted by the Parliament of Australia, establishes a framework under which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs. The primary purpose of this Act is to allow for tariff concessions on goods, providing relief on customs duties under specific circumstances. Specifically, the Act aims to facilitate the import of goods for which there are no domestically produced substitutes, thus encouraging trade and supporting industries that rely on imported components. The instrument in question, Tariff Concession Instrument No. 1010525, was introduced to address the particular needs of Acciona Windpower Oceania Pty Ltd for wind-powered generator blades. By declaring these blades to be subject to a zero percent customs duty, the instrument aims to reduce the cost of importing these goods, thereby supporting the renewable energy sector in Australia.
Scope and Application
The Tariff Concession Instrument No. 1010525, made under section 269F of the Customs Act 1901, applies to the specific goods—certain wind powered generator blades—for which Acciona Windpower Oceania Pty Ltd applied on 01 March 2010. The Act facilitates tariff concessions for goods not produced in Australia in the ordinary course of business, as defined by the Act. The geographic scope of this Act is national, affecting the entire Commonwealth of Australia, and its application is limited to the goods specified in the TCO. The Act does not specify any exclusions, but it does exclude certain goods listed in section 269SJ from being subject to a TCO. The instrument is effective as of the date the application was lodged, and it does not disadvantage or impose liabilities on any person other than the Commonwealth, with potential benefits for importers in the form of duty refunds under the Customs (Tariff) Regulations 1995. The scope and application of this legislation are further extended or restricted through subordinate instruments, which provide additional details on the administration and enforcement of tariff concessions.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 1010525 under the Customs Act 1901 (sections 269C, 269F, 269P(3), and 269S) establish a framework for the Chief Executive Officer (CEO) of Customs to consider and grant tariff concessions on specific goods. Section 269F allows an individual or entity to apply to the CEO for a Tariff Concession Order (TCO) in respect of goods, provided those goods are not specified in section 269SJ, which lists goods ineligible for a TCO. If the application meets the core criteria stipulated in section 269C, the CEO must make a TCO, as per section 269P(3). The CEO must also publish a notice in the Gazette, inviting any interested parties to submit objections to the TCO, as per section 269K(1). The TCO is considered to have come into force on the date the application was lodged, according to section 269S(1).
The obligations imposed by the Act on the parties or entities it governs include ensuring that applications for TCOs are made in compliance with the eligibility criteria specified in section 269F. The CEO of Customs has the duty to review each application, determine whether it meets the core criteria outlined in section 269C, and decide whether to grant a TCO. The CEO must also publish a notice in the Gazette inviting submissions from any interested parties, as per section 269K(1). The CEO’s decision must be made in writing, and if a TCO is granted, it must specify the prescribed item of Schedule 4 to the Customs Tariff Act 1995 that applies to the goods in question. Additionally, the Act mandates that the rights of persons other than the Commonwealth should not be adversely affected by the TCO, and any applicable refunds for duties paid before the TCO’s effective date must be processed according to the relevant regulations.
The Customs Act 1901 imposes specific civil and administrative consequences for non-compliance with the provisions of a TCO or related obligations. Any person found to have contravened the terms of a TCO may face legal action, including fines and penalties. The maximum penalties for such offences are detailed in the relevant sections of the Customs Act 1901 and associated regulations. Additionally, failure to adhere to the requirements for publishing notices in the Gazette or for considering submissions from interested parties can result in administrative penalties. These consequences serve to ensure compliance with the legislative framework governing tariff concessions and to uphold the integrity of the customs duty system.