EXPLANATORY STATEMENT
Tariff Concession Instrument No.0501480
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 hot blast stove shut-off valves on 7 February 2005.
Instrument
TCO No0501480 was made on 18 April 2005. It declares that those certain hot blast stove shut-off valves 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 No0501480 is taken to have come into force on 7 February 2005.
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 Parliament of Australia, provides a framework for the regulation of customs duties and other import and export requirements. In particular, Part XVA of the Act outlines a scheme for the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO), which reduce the rate of customs duty on specified goods. This mechanism was introduced to address the issue of ensuring fair trade practices by providing tariff relief to imported goods where no suitable Australian-made alternatives exist. The Tariff Concession Instrument No. 0501480, which was made on 18 April 2005, exemplifies the application of this scheme. In this case, Bluescope Steel Ltd applied for a TCO concerning certain hot blast stove shut-off valves, and the CEO granted the concession after determining that no substitutable goods were produced in Australia, thereby reducing the duty rate from 5% to 3%. This legislative instrument aims to facilitate trade by providing tariff relief, thereby supporting the policy objective of promoting efficient and fair international trade practices.
Scope and Application
The Tariff Concession Instrument No. 0501480, made under the Customs Act 1901, applies to the specific goods known as certain hot blast stove shut-off valves. This instrument was enacted to provide tariff concessions, thereby reducing the rate of customs duty on these particular goods from the general rate of 5% to a concessional rate of 3%. The application for this tariff concession was made by Bluescope Steel Ltd on 7 February 2005, and the instrument came into force on the same date. The concession was granted after the Chief Executive Officer of Customs was satisfied that the application met the core criteria, specifically that no substitutable goods were being produced in Australia on the date the application was lodged. The instrument does not disadvantage any person other than the Commonwealth and does not impose any liabilities on any person for actions taken prior to the date of registration. It is pertinent to note that this tariff concession is specific to the named goods and does not extend to other goods unless similarly applied for and approved.
Key Provisions
The main operative sections of this legislation concern the process and criteria for making Tariff Concession Orders (TCOs) under the Customs Act 1901. Specifically, section 269F allows for an application to the Chief Executive Officer of Customs (CEO) for a TCO in respect of certain goods. To meet the core criteria, the CEO must be satisfied that, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business, as outlined in section 269C. This means that if the goods in question are not being produced domestically, a lower customs duty rate can be applied. Once the CEO determines that an application meets the core criteria, they are required under section 269P(3) to issue a written order declaring the goods eligible for the concession.
Under this legislation, the obligations imposed on the parties primarily involve the CEO and the applicant. The CEO must ensure that the application meets the core criteria by verifying that no substitutable goods are being produced domestically. This involves assessing whether the goods in question have Australian alternatives that could serve the same purpose. Additionally, the CEO is required to publish a notice in the Gazette, inviting any interested parties to lodge submissions if they believe the TCO should not be made, as stipulated in section 269K(1). The applicant, in this case Bluescope Steel Ltd, must provide sufficient information to satisfy the CEO that the goods meet the eligibility criteria for a TCO.
Regarding consequences for breach, the Act does not explicitly state offences, penalties, or specific consequences for failing to comply with the TCO requirements. However, the nature of the concessions implies that misuse or fraudulent applications could result in the revocation of the TCO, leading to the reinstatement of the higher duty rates. Additionally, any person found to have provided false information in their application could face legal action for misrepresentation or fraud. The specific penalties would depend on the nature and severity of the breach, aligning with general legal principles and potentially involving civil or criminal proceedings.