EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1022539
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.
Metal Manufacturers Pty Ltd applied for a TCO in respect of certain phosphorous deoxidised copper billet casting lines on 19 May 2010.
Instrument
TCO No 1022539 was made on 09 August 2010. It declares that those certain phosphorous deoxidised copper billet casting lines 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. 1022539 is taken to have come into force on 19 May 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, provides a framework for the regulation of customs and excise, including the establishment of a tariff concession scheme to facilitate trade. This scheme allows the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs), which apply lower rates of customs duty to certain goods, provided that no substitutable goods are produced in Australia. The Tariff Concession Instrument No. 1022539 was introduced to address the specific needs of Metal Manufacturers Pty Ltd, which applied for a concession on certain phosphorous deoxidised copper billet casting lines. The instrument, which came into effect on 19 May 2010, grants a free rate of duty on these goods, as no substitutable goods were being produced in Australia at the time of the application. The policy objective of this legislation is to support Australian industry by reducing the duty on specific imported goods, thereby enhancing competitiveness without disadvantaging existing rights or imposing new liabilities on individuals or entities.
Scope and Application
The Customs Act 1901, through Part XVA, provides a framework for the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that apply a lower rate of customs duty to certain goods. This mechanism is available to any person who meets the core criteria set out in section 269C, which requires that, on the day the application is lodged, no substitutable goods are produced in Australia in the ordinary course of business. The scope of the Act applies broadly to any entity or individual seeking to import goods that can benefit from tariff concessions, provided they meet the specified criteria and are not restricted by section 269SJ which outlines exceptions. The geographic reach of the Act is national, as it applies throughout Australia and aligns with the broader Customs Act 1901, which is a Commonwealth Act. The Tariff Concession Instrument No. 1022539, for example, was made on 09 August 2010, declaring that certain phosphorous deoxidised copper billet casting lines would benefit from free duty under item 50 of Schedule 4 to the Customs Tariff Act 1995, as no substitutable goods were produced in Australia. The commencement of a TCO is deemed to be on the date the application is lodged, ensuring no retroactive disadvantages to parties, except for the Commonwealth.
Key Provisions
The key operative sections of this legislation, specifically Tariff Concession Order No. 1022539, pertain to the Customs Act 1901 and the Customs Tariff Act 1995. Section 269C (2) and (3) provide the criteria for determining if a Tariff Concession Order (TCO) application meets the core requirements, which include verifying that no substitutable goods are produced in Australia at the time of application. Section 269F allows for an application to the Chief Executive Officer (CEO) of Customs for a TCO in respect of goods, while section 269P(3) mandates that if the CEO is satisfied with the application, a written order (the TCO) must be made. This order specifies the goods subject to the concession and the applicable rate of duty, as outlined in Schedule 4 of the Customs Tariff Act 1995. In this case, TCO No. 1022539 applies to certain phosphorous deoxidised copper billet casting lines, reducing the duty rate from 5% to free.
The obligations and requirements imposed by this legislation on parties and entities include the application process for a TCO, as detailed in section 269F. The CEO of Customs is required to assess the application against the core criteria, particularly ensuring that no substitutable goods are produced in Australia as per section 269C. If the CEO determines that the application meets these criteria, they must publish a notice in the Gazette (subsection 269K(1)) inviting any objections or submissions from interested parties. Additionally, under section 269S(1), the TCO comes into force on the date the application was lodged, in this case, 19 May 2010. The CEO is also required to ensure that the TCO does not disadvantage any person or impose liabilities on them in respect of actions taken before the TCO's effective date.
The legislation also outlines potential consequences for breaches of its provisions. Although specific offences and penalties are not detailed in the provided text, it is implied that failure to comply with the TCO requirements or any misuse of the concessions granted could result in legal repercussions. Such breaches may lead to civil or criminal penalties, depending on the nature and severity of the offence, although the exact penalties are not specified within the provided excerpt. Generally, breaches of customs regulations can lead to fines, penalties, or other legal actions as determined by the relevant authorities.