EXPLANATORY STATEMENT
Tariff Concessions Revocation Instrument 24/2010
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 and revoked 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 sections 269C and 269P of the Act, a TCO will be made if the application for the TCO meets the core criteria, that is, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business.
Section 269SB of the Act provides, in part, that a person claiming to be a producer in Australia of substitutable goods in relation to the goods covered by a TCO may request the CEO to revoke the TCO.
Under subsection 269SC(1) of the Act, the CEO must decide whether of not her or she is satisfied:
− that, on the day of lodgement of the request, the person requesting the revocation of the TCO is a producer in Australia of goods that are substitutable goods in relation to the goods the subject of the TCO;
− that, if the TCO were not in force on that day but that day were the day on which the application for that TCO was lodged, the CEO would not have made the TCO.
If the CEO is satisfied of those matters but is also satisfied that a narrower TCO could have been made on the day the request to revoke was lodged, the TCO must revoke the TCO and make, in its place, such a narrower TCO (subsection 269SC(4) refers).
Rotary Heat Exchangers Pty Ltd requested that the CEO revoke TCO 0843193 which covers heat exchangers.
Instrument
Tariff Concession Instrument No 24/2010 was made on 28 October 2009. It revokes TCO 0843193 and remakes a narrower TCO 0939949 covering heat exchangers as the CEO is satisfied that he or she would not have made the old TCO but could have made the narrower TCO.
Consultation
Subsection 269SC(1A) of the Act provides that as soon as practicable after receiving a request for revocation of a TCO, the CEO must publish in a Gazette a notice which includes a statement that a request has been lodged and the full particulars of the TCO to which the request relates.
Commencement
Subsection 269SC(6) provides that an order revoking a TCO comes into force on the day on which the request to revoke the TCO was lodged.
Subsection 269SC(7) provides that if a narrower TCO is made in place of another TCO, that narrower TCO comes into force from the date of effect of the revocation of the other TCO.
Subsection 239SD(8) provides that subsections 269SC(6) and 269SC(7) have effect despite section 12 of the Legislative Instruments Act 2003. Section 12 prohibits the making of certain retrospective legislative instruments.
Tariff Concession Instrument No.24/2010 revoked 0843193 and made the narrower TCO No. 0939949 on 28 October.2009, with the revocation date of effect 7 September 2009
Overview
The Customs Act 1901, enacted by the Australian Parliament, establishes a framework for imposing customs duty on imported goods, with provisions for tariff concessions where certain conditions are met. Specifically, Part XVA of the Act allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which apply reduced customs duty rates to specified goods when no substitutable goods are produced in Australia. The Tariff Concessions Revocation Instrument 24/2010 addresses the gap in the legislative framework by providing a mechanism for the revocation of TCOs in cases where new information indicates that the original conditions for concession may no longer apply. This instrument was made to respond to a request by Rotary Heat Exchangers Pty Ltd to revoke an existing TCO pertaining to heat exchangers, which was subsequently revoked and replaced with a narrower TCO. The policy objective behind this revocation is to ensure that tariff concessions are dynamically aligned with the current state of production in Australia, preventing undue benefits to importers when domestic production capabilities have developed or changed.
Scope and Application
The Customs Act 1901, through Part XVA, governs the creation, revocation, and management of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). This Act applies to any person or entity seeking to lodge an application for a TCO or requesting its revocation, specifically where goods subject to the TCO are involved. The geographic reach of this Act is national, as it is a Commonwealth Act. The CEO must assess whether the applicant for the revocation of a TCO is a producer of substitutable goods in Australia and if the TCO would not have been made if the request was lodged on the day the initial application was made. If these conditions are met and a narrower TCO could be applied, the CEO revokes the existing TCO and issues a narrower one. The Act also mandates the CEO to publish details of the revocation request in a Gazette as soon as practicable. The revocation of a TCO and the issuance of a narrower TCO take effect from the date the request to revoke was lodged, notwithstanding certain retrospective legislative restrictions.
Key Provisions
The Tariff Concessions Revocation Instrument 2010 (F2010L02288) primarily focuses on the revocation and remaking of Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269SB of the Act allows a person claiming to be a producer in Australia of substitutable goods to request the Chief Executive Officer of Customs (CEO) to revoke a TCO. The CEO, as outlined in section 269SC(1), must then determine whether the requester is indeed a producer of substitutable goods and whether they would have made the TCO if it were being considered on the day the revocation request was lodged. If satisfied, the CEO must revoke the TCO and, if possible, replace it with a narrower TCO as per section 269SC(4). This process was applied in the case of Rotary Heat Exchangers Pty Ltd, where TCO 0843193, which covers heat exchangers, was revoked and replaced with the narrower TCO 0939949 on 28 October 2009, effective from 7 September 2009.
The obligations imposed by the Act on the CEO include the requirement to publish a notice in a Gazette as soon as practicable after receiving a request for the revocation of a TCO, detailing the request and the full particulars of the TCO in question (subsection 269SC(1A)). Additionally, the CEO must ensure that any new TCO made in place of the revoked one comes into force from the date of the revocation of the original TCO (subsection 269SC(7)). These provisions ensure transparency and adherence to the legislative process.
Failure to comply with the requirements of the Customs Act 1901 may result in legal consequences. While the Act does not explicitly detail specific offences, penalties, or civil/criminal consequences for breaches related to TCOs, it is implied that non-compliance with the CEO's obligations could lead to legal action. The Act's provisions are designed to ensure that TCOs are appropriately managed and that the interests of Australian producers are protected. The revocation and remaking of TCOs must follow the stipulated procedures to maintain the integrity of the tariff concession scheme.