EXPLANATORY STATEMENT
Tariff Concessions Revocation Instrument 6/2011
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 subsections 269SC(1) and (3) of the Act, the CEO must make an order revoking the TCO if the CEO 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; and
− 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.
Ausco Modular Pty Limited requested that the CEO revoke TCO 0900935 which covers prefabricated buildings.
Instrument
Tariff Concessions Revocation Instrument No 6/2011 was made on 24 May 2010. It revokes TCO 0900935 as the CEO is satisfied that Ausco Modular Pty Limited is a producer in Australia of substitutable goods and that the CEO would not have made the 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 239SD(8) provides, in part, that subsection 269SC(6) has effect despite section 12 of the Legislative Instruments Act 2003. Section 12 prohibits the making of certain retrospective legislative instruments.
Tariff Concessions Revocation Instrument No.6/2010, TCO 0900935, was revoked on 24 May 2010 with the Revocation date of effect as from 1 April 2010.
Overview
The Customs Act 1901, enacted by the Parliament of Australia, establishes a framework for the imposition of customs duty and the administration of customs and excise laws. Part XVA of the Act allows for the creation and revocation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which apply lower rates of customs duty to specific goods under certain conditions. The Tariff Concessions Revocation Instrument No. 6/2011 addresses the issue of revoking a TCO when the conditions for its existence no longer apply. This instrument revokes TCO 0900935, which covered prefabricated buildings, following a request from Ausco Modular Pty Limited. The revocation was enacted as the CEO determined that Ausco Modular Pty Limited is now a producer of substitutable goods in Australia, and that if the TCO had not been in force, it would not have been issued. This legislative instrument aims to ensure that tariff concessions are only applied when they remain beneficial and necessary, reflecting the policy objective of maintaining fair and competitive market conditions in Australia.
Scope and Application
The Tariff Concessions Revocation Instrument 6/2011 applies to the revocation of Tariff Concession Orders (TCOs) under Part XVA of the Customs Act 1901. This instrument specifically addresses the revocation of TCO 0900935, which pertains to prefabricated buildings, following a request by Ausco Modular Pty Limited. The legislation is designed to manage the conditions under which tariff concessions are granted and subsequently revoked, ensuring that such concessions are only in place when justified by the absence of substitutable goods being produced in Australia. The revocation process is triggered when a producer of substitutable goods requests the Chief Executive Officer of Customs (CEO) to revoke the TCO, and the CEO is satisfied that the conditions for revocation have been met. The geographic reach of this legislation is confined to Australia, and its application is subject to the specific criteria outlined in the Customs Act 1901. The revocation order is effective from the date the request to revoke the TCO was lodged, notwithstanding certain prohibitions on retrospective legislative instruments.
Key Provisions
The Tariff Concessions Revocation Instrument 6/2011 (Instrument) revokes Tariff Concession Order (TCO) 0900935, which applied to prefabricated buildings, under section 269SC of the Customs Act 1901 (the Act). This revocation is grounded on the Chief Executive Officer of Customs (CEO) being satisfied that Ausco Modular Pty Limited, a producer in Australia of goods substitutable to those covered by TCO 0900935, has requested its revocation. Additionally, the CEO is satisfied that, if TCO 0900935 were not in force on the day the revocation request was lodged, it would not have been made in the first place.
Under the Act, the CEO is mandated to revoke a TCO if certain conditions are met. Specifically, under section 269SC(1) and (3), the CEO must revoke a TCO if they are satisfied that the applicant for revocation is a producer in Australia of goods substitutable to those the TCO covers, and that, had the TCO not been in force on the day the request for revocation was made, it would not have been issued. This provision ensures that tariff concessions are not granted if local production of substitutable goods exists or would exist if the concession were not in place.
The Act imposes certain obligations on the CEO in the process of revoking a TCO. Firstly, under section 269SC(1A), the CEO must publish in a Gazette a notice of the request for revocation, including the full particulars of the TCO, as soon as practicable after receiving the request. This requirement ensures transparency and provides interested parties with timely information regarding the revocation process. Furthermore, the revocation order itself takes effect on the day the request for revocation was lodged, as stipulated in section 269SC(6), and this is despite the prohibitions in section 12 of the Legislative Instruments Act 2003 against the making of retrospective legislative instruments.
The Act does not explicitly state any offences, penalties, or civil/criminal consequences for failure to comply with the requirements of revoking a TCO. However, the revocation of a TCO can have significant financial implications for businesses that relied on the tariff concessions provided by the TCO, as they would be subject to the standard rates of customs duty. Additionally, the CEO’s failure to publish the notice of a revocation request in the Gazette, as required by section 269SC(1A), could lead to legal challenges regarding the validity of the revocation process.