EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0504562
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 Walking Beam Furnace Parts on 20 April 2005.
Instrument
TCO No 0504562 was made on 2 September 2005. It declares that those certain Walking Beam Furnace Parts 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 0%.
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. 0504562 is taken to have come into force on 20 April 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, establishes a framework for the regulation of customs and excise duties. Part XVA of this Act allows the Chief Executive Officer of Customs to issue Tariff Concession Orders (TCOs), which provide for reduced customs duty rates on specified goods. The explanatory statement for Instrument No. 0504562, made under this Act, addresses the application by Bluescope Steel Ltd for a TCO on certain Walking Beam Furnace Parts. The instrument was enacted to ensure that these specific goods are subject to a zero per cent duty rate, down from the general rate of five per cent, provided that no substitutable goods were produced in Australia at the time of application. The objective of the TCO, as per section 269C of the Act, is to apply a tariff concession if the application meets the core criteria, which includes the condition that no substitutable goods were produced domestically. The instrument came into force on the date the application was lodged, 20 April 2005, and does not disadvantage any person other than the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0504562 under the Customs Act 1901 applies specifically to certain Walking Beam Furnace Parts. This legislation allows for a lower rate of customs duty for these specified goods when a Tariff Concession Order (TCO) is in effect. The Act applies to entities such as Bluescope Steel Ltd that have applied for and received a TCO, thereby altering the duty on these goods from the general rate of 5% to 0%. The geographic reach of this Act is national, as it pertains to customs duties across Australia, governed by the Commonwealth. Exclusions under this Act include goods specified in section 269SJ of the Customs Act, which are ineligible for a TCO. The application of the Act can be extended or restricted through subordinate instruments, although in this case, no such instruments are noted. The instrument does not disadvantage any person other than the Commonwealth and does not impose any new liabilities, benefiting importers who can apply for a refund of duty on the affected goods.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 0504562 are found within the Customs Act 1901, specifically sections 269C, 269B, 269D, 269E, 269F, 269P, 269K, and 269S. Section 269F allows for an application to be made to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO) concerning particular goods. If the CEO determines that the application meets the core criteria outlined in section 269C, which includes the absence of substitutable goods produced in Australia in the ordinary course of business as per sections 269B and 269D, a TCO is to be issued under section 269P(3). Section 269K mandates the CEO to publish a notice in the Gazette inviting submissions from any interested parties regarding the application, while section 269S specifies that the TCO comes into effect on the day the application is lodged.
The Act imposes certain obligations on the parties involved. The applicant, in this case, Bluescope Steel Ltd, must provide sufficient information and justification to support the TCO application, ensuring it complies with the core criteria. The CEO of Customs has the responsibility to review the application, consider any submissions received, and make a decision based on the evidence and criteria specified in the Act. Upon making a TCO, the CEO must ensure that it is published in the Gazette and made available to the public, thereby providing transparency and allowing interested parties to comment or object if necessary.
Failure to comply with the requirements of the Customs Act 1901 and the related Tariff Concession Instrument can lead to various civil or criminal consequences. While the specific penalties are not detailed in the explanatory statement, breaches of customs legislation generally can result in fines and other penalties under the Act. For instance, providing false or misleading information in an application could be considered an offence, potentially leading to prosecution and significant fines. Additionally, any misuse of the tariff concession by not adhering to the terms set out in the TCO could also result in financial penalties or other enforcement actions by Customs.
In summary, the Tariff Concession Instrument No. 0504562 and the relevant sections of the Customs Act 1901 outline the process for applying for and obtaining a TCO, detailing the obligations of both the applicant and the CEO of Customs, and the potential consequences for non-compliance. The instrument specifically addresses the application for tariff concessions on certain Walking Beam Furnace Parts, providing a lower rate of customs duty for these goods.