EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1101012
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.
Meridian Pty Ltd applied for a TCO in respect of certain ore concentrator cyclones on 10 January 2011.
Instrument
TCO No 1101012 was made on 28 March 2011. It declares that those certain ore concentrator cyclones 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. 1101012 is taken to have come into force on 10 January 2011.
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 Australian Parliament, establishes a framework for the regulation of imports and exports within Australia. A significant part of this framework is the provision for Tariff Concession Orders (TCOs) under Part XVA, which allows the Chief Executive Officer of Customs to reduce the customs duty on certain imported goods. This was introduced to address the need for tariff flexibility to support specific economic needs and to encourage trade by reducing the cost of importing certain goods. Instrument No. 1101012, issued on 28 March 2011, exemplifies this process by granting a tariff concession to Meridian Pty Ltd for certain ore concentrator cyclones, reducing the duty on these goods from 5% to free, effective from 10 January 2011. This legislative instrument ensures that the concession does not adversely affect existing rights or impose new liabilities, while potentially benefiting importers by allowing them to seek refunds on duties paid prior to the concession's effective date.
Scope and Application
The Tariff Concession Instrument No. 1101012 under the Customs Act 1901 applies to the goods specified in the instrument, namely certain ore concentrator cyclones, which Meridian Pty Ltd applied for a tariff concession on. The application of this Act extends to the Chief Executive Officer of Customs, who is responsible for deciding whether the application meets the core criteria for a tariff concession. This decision process hinges on whether substitutable goods were produced in Australia on the day the application was lodged. The geographic reach of this legislation is national, as it pertains to the Customs Act 1901, which is a Commonwealth Act. The instrument exempts these specified goods from the general rate of duty, which is 5%, and instead subjects them to a tariff concession rate of free. The instrument does not affect the rights of any person other than the Commonwealth, nor does it impose any liabilities on any person. The instrument came into effect on the date the application was lodged, which was 10 January 2011, and no submissions were received in response to the invitation for objections published in the Gazette.
Key Provisions
The primary sections of the Tariff Concession Instrument No. 1101012 under the Customs Act 1901 include section 269C, which sets the core criteria that a Tariff Concession Order (TCO) application must meet, and section 269P(3), which outlines the process for the Chief Executive Officer (CEO) of Customs to make a TCO if the application satisfies these criteria. Section 269F allows a person to apply for a TCO in respect of goods, and section 269SJ specifies goods that cannot be subject to a TCO. If the CEO is satisfied that the application meets the core criteria, they must issue a written order, a TCO, that declares the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies, as per subsection 269P(3). The instrument also specifies that a TCO comes into force on the day the application is lodged, under subsection 269S(1).
The Act imposes several obligations on the CEO when considering a TCO application. Firstly, under subsection 269K(1), the CEO must publish a notice in the Gazette inviting any person who believes the TCO should not be made to lodge a submission. This ensures transparency and allows for public input. Additionally, the CEO must determine whether the application meets the core criteria specified in section 269C, particularly focusing on whether no substitutable goods were produced in Australia in the ordinary course of business at the time of application. If the application meets these criteria, the CEO must make a written TCO as per section 269P(3). The CEO must also ensure that the TCO does not affect the rights of any person adversely, other than the Commonwealth, in respect of actions taken before the date of registration, as per the instrument's provisions.
Failure to comply with the requirements set out in the Customs Act 1901 or the Tariff Concession Instrument No. 1101012 may result in civil or criminal consequences. However, the specific offences, penalties, or consequences for breach are not detailed in the explanatory statement. It is important for parties to adhere to the statutory requirements to avoid any potential legal ramifications. The CEO's decisions and actions are guided by the Act and the instrument to ensure that TCOs are issued fairly and in accordance with the law. Any breach of these provisions could lead to legal action, but the exact penalties are not specified in the provided text.