EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0413472
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.
Bluescope Steel Ltd applied for a TCO in respect of certain refractory powder and oxygen mixture projectors on 10 December 2004.
Instrument
TCO No 0413472 was made on 11 February 2005. It declares that those certain refractory powder and oxygen mixture projectors 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 3%.
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. 0413472 is taken to have come into force on 10 December 2004.
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. 0413472 was enacted in 2005 under the Customs Act 1901, which provides a framework for Tariff Concession Orders (TCOs) aimed at lowering the customs duty rates for specific goods. This particular instrument was introduced to address the need for a tariff concession for certain refractory powder and oxygen mixture projectors, as applied for by Bluescope Steel Ltd. The instrument was designed to ensure that the application for tariff concession met the core criteria, specifically that no substitutable goods were being produced in Australia. The Tariff Concession Order was made on 11 February 2005, reducing the duty rate for these specific goods from 5% to 3%. The instrument was published in the Gazette with an invitation for submissions, although none were received. The policy objective, as stated in the explanatory statement, is to facilitate the reduction of duty rates on goods that meet the specified criteria, thereby benefiting importers.
Scope and Application
The Tariff Concession Instrument No. 0413472 under the Customs Act 1901 applies to entities or individuals who wish to import goods that are subject to a Tariff Concession Order (TCO). Specifically, the Act facilitates the reduction of customs duty on certain goods when an application is made to the Chief Executive Officer of Customs and the criteria outlined in the Act are satisfied. The Act applies to entities or individuals seeking to import goods that are not produced in Australia and for which no suitable substitutes are available domestically. The instrument reduces the customs duty on these goods, in this instance, certain refractory powder and oxygen mixture projectors, from the general rate of 5% to a concessional rate of 3%. The geographic reach of the Act is national, as it pertains to the importation of goods into Australia. The Act does not specify exclusions but inherently excludes goods that are produced in Australia or for which substitutable goods are produced domestically. The Act's application may also be extended or restricted through subordinate instruments, although no such instruments are mentioned in the context of this specific TCO.
Key Provisions
The Customs Act 1901 (the Act) contains provisions that allow for the implementation of Tariff Concession Orders (TCOs) as outlined in sections 269F to 269P. Under section 269F, an application can be made to the Chief Executive Officer of Customs (the CEO) for a TCO in respect of certain goods. Section 269C specifies that for an application to meet the core criteria, no substitutable goods can be produced in Australia in the ordinary course of business on the day the application is lodged. The CEO must then make a written order (a TCO) if satisfied that the application meets these criteria, as stipulated in section 269P(3).
The obligations imposed on parties by this Act include the requirement for the CEO to consider applications for TCOs and ensure that they meet the core criteria. Section 269K(1) mandates that the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting submissions from any interested parties. Furthermore, section 269S(1) specifies that a TCO is deemed to come into force on the date the application was lodged. The Act also stipulates that the TCO does not affect the rights of any person, other than the Commonwealth, in a manner that disadvantages them or imposes liabilities for actions taken before the registration date.
Failure to comply with the provisions of the Act can lead to various consequences. While the explanatory statement does not explicitly list specific offences or penalties, breaches of the Act could potentially result in civil or criminal actions. The severity of these actions would depend on the nature and extent of the breach, with penalties potentially including fines or other legal repercussions as outlined in the broader legal framework governing customs duties and tariffs.
In summary, the key provisions of the Customs Act 1901 concerning TCOs establish a framework for application, assessment, and implementation of tariff concessions, with obligations on the CEO to consider and publish notices regarding applications. The Act ensures that TCOs do not adversely affect the rights of non-Commonwealth entities and imposes no liabilities for actions taken before the registration date of the TCO.