EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1038767
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.
Como Glasshouse applied for a TCO in respect of certain industrial glasshouse wetback boiler parts on 23 August 2010.
Instrument
TCO No 1038767 was made on 15 November 2010. It declares that those certain industrial glasshouse wetback boiler parts 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. 1038767 is taken to have come into force on 23 August 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 Tariff Concession Instrument No. 1038767 was enacted in 2010 as part of the Customs Act 1901, aimed at providing relief from customs duties for certain specified goods. This legislation was introduced to address a gap in the tariff concessions scheme by allowing for the application of lower customs duty rates on goods that are not substitutable by Australian-produced alternatives. The instrument was developed following an application from Como Glasshouse for tariff concessions on industrial glasshouse wetback boiler parts, where it was determined that no substitutable goods were produced domestically. The Tariff Concession Order (TCO) was approved by the Chief Executive Officer of Customs, who was satisfied that the application met the core criteria outlined in the Act, specifically that no substitutable goods were produced in Australia. This decision was made in accordance with the legislative framework that requires the publication of applications in the Gazette and invites public submissions, none of which were received in this instance. The TCO came into effect on the date the application was lodged, ensuring that the rights of importers are positively affected and any potential liabilities for past actions are not imposed.
Scope and Application
The Tariff Concession Instrument No. 1038767, made under the Customs Act 1901, applies to specific industrial glasshouse wetback boiler parts by providing a concession on the customs duty rate. This instrument is relevant to importers of the specified goods, as it reduces the duty from the general rate of 5% to free. The application of this concession is contingent upon the Chief Executive Officer of Customs being satisfied that no substitutable goods are produced in Australia in the ordinary course of business. This concession operates nationally, affecting the rights of importers in relation to the importation of these goods from the date the application for the tariff concession was lodged, 23 August 2010. The instrument does not disadvantage any person other than the Commonwealth and does not impose any liabilities on any person. Importantly, it does not affect any existing rights or liabilities incurred before its effective date. Subordinate instruments may further extend or clarify the application of this Tariff Concession Order.
Key Provisions
The key provisions of Tariff Concession Order No. 1038767, which was made under the Customs Act 1901, are outlined in section 269C (1) and (2), which specify the core criteria that must be met for a Tariff Concession Order (TCO) to be made. Section 269C(1) stipulates that a TCO application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. This is further defined in section 269D (for goods produced in Australia), section 269E (for ordinary course of business) and section 269D (for substitutable goods). If the Chief Executive Officer (CEO) of Customs is satisfied that the application meets these criteria, they must make a written order declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The obligations and requirements imposed by this Act on the parties involved are outlined in section 269K(1), which mandates that the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid. This notice must include an invitation for any person who believes the TCO should not be made to lodge a submission with the CEO. In this case, the CEO did not receive any submissions in response to this invitation. Additionally, under section 269S(1), a TCO is taken to have come into force on the day on which the application for the TCO was lodged. The rights of importers will be beneficially affected, as they can apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force under paragraph 126(1)(r) of the Regulations.
In terms of offences, penalties, or consequences for breach, the Customs Act 1901 does not explicitly outline specific criminal or civil penalties for failing to comply with the provisions of a TCO. However, it is important to note that the Act 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. Therefore, the rights of importers will be beneficially affected, and the TCO does not impose any liabilities on any person. It is also worth noting that the Act may impose other administrative or regulatory consequences for non-compliance with the terms of a TCO, such as fines or other penalties, but these are not explicitly outlined in the text of the Act.