EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1131848
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.
Maccaferri Australia applied for a TCO in respect of certain drains on 19 September 2011.
Instrument
TCO No 1131848 was made on 12 December 2011. It declares that those certain drains 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. 1131848 is taken to have come into force on 19 September 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 was enacted by the Parliament of Australia to provide a comprehensive framework for the regulation of customs and excise duties, and it includes provisions for Tariff Concession Orders (TCOs). This instrument, F2012L00536, addresses the specific issue of granting tariff concessions for certain goods, in this case, certain drains, when there are no substitutable goods produced in Australia. The explanatory statement indicates that Maccaferri Australia applied for this concession on 19 September 2011, and after the Chief Executive Officer of Customs determined that the core criteria were met, TCO No. 1131848 was issued on 12 December 2011. This order effectively applies a free rate of duty to the specified drains, reducing it from the general rate of 5%. The process involved public consultation, which in this instance did not receive any submissions opposing the concession. The instrument is designed to ensure that the rights of importers are positively affected and that no existing liabilities or rights are adversely impacted by the concession.
Scope and Application
The Customs Act 1901 applies to individuals and entities involved in the importation of goods into Australia, particularly in the context of tariff concessions. The Act provides a framework under which the Chief Executive Officer of Customs can make Tariff Concession Orders (TCOs), which lower the rate of customs duty on specified goods. Specifically, the Act applies to applications for TCOs made under section 269F, provided that the goods in question do not fall under the exclusions listed in section 269SJ. The application process requires that the CEO be satisfied that no substitutable goods are produced in Australia in the ordinary course of business, as defined by sections 269D, 269E and 269F of the Act. The CEO must make a written order if the core criteria are met, as per section 269P(3). The TCO's scope extends nationally and its effects are governed by the commencement date specified in section 269S(1). The Act ensures that TCOs do not adversely affect the rights of any person other than the Commonwealth and do not impose new liabilities on individuals or entities.
Key Provisions
The main operative sections of this Tariff Concession Instrument (TCO) are sections 269C, 269P, and 269S of the Customs Act 1901 (the Act). Section 269C (1) outlines the core criteria that must be satisfied for an application for a Tariff Concession Order (TCO) to be approved, primarily that no substitutable goods were produced in Australia on the date the application was lodged. Section 269P (3) states that if the Chief Executive Officer (CEO) of Customs is satisfied that the application meets these core criteria, the CEO must make a written order declaring the goods to which the TCO applies. Section 269S (1) provides that the TCO is taken to have come into force on the date the application for the TCO was lodged.
The Act imposes certain obligations and requirements on the parties involved. Firstly, section 269F allows a person to apply to the CEO for a TCO in respect of goods. The CEO is then required to decide if the application meets the core criteria as specified in section 269C. If the CEO is satisfied, they must make a written order declaring that the goods are subject to a TCO, as per section 269P (3). The CEO must also, as soon as practicable after accepting a TCO application as valid, publish a notice in the Gazette inviting any person who believes the TCO should not be made to lodge a submission, in accordance with section 269K (1). This ensures transparency and an opportunity for interested parties to voice any objections.
Under this legislation, any breach of the obligations and requirements outlined can lead to civil or criminal consequences. However, the explanatory statement does not detail specific offences, penalties, or consequences for breach. It is important to note that while the Act does not impose any liabilities on any person under the TCO, it is prudent for all parties to adhere to the statutory requirements to avoid potential legal ramifications. Non-compliance with the Act could potentially result in the invalidation of the TCO, financial penalties, or legal action as prescribed by other sections of the Customs Act and related regulations. The precise penalties would depend on the nature and severity of the breach, and any applicable laws or regulations.