EXPLANATORY STATEMENT
Tariff Concession Instrument No.0501738
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 Limited applied for a TCO in respect of certain uncoiler DC motors and/or drag generators on 11 February 2005.
Instrument
TCO No 0501738 was made on 22 April 2005. It declares that those certain uncoiler DC motors and/or drag generators 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. 0501738 is taken to have come into force on 11 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 was enacted by the Australian Parliament to regulate the import and export of goods in Australia, among other things. In 2005, a specific problem arose concerning the need for tariff concessions for certain imported goods, which led to the introduction of the Tariff Concession Instrument No. 0501738. This instrument was created to address the gap in the application process for tariff concession orders, ensuring that certain imported goods could receive a lower rate of customs duty when it was established that no substitutable goods were produced in Australia. The policy objective behind this instrument was to facilitate trade by reducing the duty on specific imported goods, thereby making them more competitive in the Australian market and supporting economic efficiency. The instrument was published in the Gazette and no submissions were received against it, indicating broad acceptance of the tariff concession for these specific goods.
Scope and Application
The Tariff Concession Instrument No. 0501738 under the Customs Act 1901 applies to certain uncoiler DC motors and/or drag generators, specifically those identified by Bluescope Steel Limited. This legislation is concerned with the imposition of a lower rate of customs duty on these goods, as outlined in the instrument. The instrument was created after the CEO of Customs determined that no substitutable goods were produced in Australia at the time the application was lodged, meeting the core criteria specified in the Act. The application of this concession is restricted to the goods explicitly mentioned in the instrument, and it does not extend to any other goods unless similarly specified in a subsequent order. The TCO does not impact the rights of any person, including the Commonwealth, in relation to actions taken before the date of registration, ensuring that no existing rights or obligations are adversely affected.
Geographically, the scope of this Act is national, applying across Australia in accordance with the provisions of the Customs Act 1901. The Act’s jurisdictional reach is established under Commonwealth law, with the CEO of Customs having the authority to issue TCOs as specified. There are no exclusions or exemptions stated within the specific terms of this Instrument, but the broader Act includes provisions that may exclude certain goods from TCO eligibility. The Act allows for the extension and restriction of application through subordinate instruments, thereby providing flexibility in managing tariff concessions for various goods as needed.
Key Provisions
The key sections of Tariff Concession Instrument No. 0501738 (F2005L00972) under the Customs Act 1901 (the Act) include sections 269C, 269B, 269D, 269E, and 269P, which define the criteria and processes for applying for and granting a Tariff Concession Order (TCO). Section 269C stipulates that a TCO application meets the core criteria if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Sections 269B, 269D, and 269E provide definitions for terms such as 'goods produced in Australia,' 'ordinary course of business,' and 'substitutable goods.' Finally, section 269P(3) mandates that if the Chief Executive Officer (CEO) of Customs is satisfied that the application meets the core criteria, a written order must be made declaring that the specified goods are subject to a prescribed item in Schedule 4 of the Customs Tariff Act 1995 (the Tariff).
The obligations imposed by the Act on the parties involved primarily revolve around the application and assessment process for TCOs. The CEO of Customs must review applications to ensure they meet the core criteria, particularly that no substitutable goods were produced in Australia in the ordinary course of business. Upon satisfying these criteria, the CEO must issue a TCO. Additionally, the CEO is required to publish a notice in the Gazette inviting any interested parties to submit reasons why the TCO should not be made. If no submissions are received, the CEO proceeds to grant the TCO. The applicant, in this case, Bluescope Steel Limited, must submit a valid application detailing the goods in question and ensuring that the core criteria are met. The CEO is then responsible for verifying these claims and making a decision.
In terms of consequences for breaches or non-compliance, the Act does not specify any particular offences, penalties, or civil/criminal consequences for failing to comply with the provisions of a TCO. However, any party aggrieved by the decision of the CEO may have recourse to judicial review under the Administrative Decisions (Judicial Review) Act 1977. This means that if a party believes that the CEO's decision to grant or refuse a TCO was unlawful, they can seek a review in the Federal Court. While specific penalties are not outlined in the Act for breaches of the TCO process itself, any subsequent misuse of the TCO or fraudulent claims could lead to penalties under other relevant legislation, such as fines or imprisonment for customs-related offences.
The Tariff Concession Instrument No. 0501738, as made under the Customs Act 1901, outlines a structured process for granting tariff concessions on specific goods. By adhering to the legislative requirements and ensuring all criteria are met, the CEO facilitates the reduction of customs duties for the applicants, thereby impacting the rights of importers favourably. The instrument does not impose liabilities on persons other than the Commonwealth and does not disadvantage any party by affecting rights as at the date of registration. The effective date of the TCO, in this case, 11 February 2005, ensures that any import duties accruing from that date onward are subject to the reduced rate specified in the TCO.