EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0509758
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 Roller Jackets and/or Electro Magnetic Stirrer Sleeves on 21 July 2005.
Instrument
TCO No 0509758 was made on 30 September 2005. It declares that those certain Roller Jackets and/or Electro Magnetic Stirrer Sleeves 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. 0509758 is taken to have come into force on 21 July 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 Tariff Concession Instrument No. 0509758 was enacted in 2005 under the Customs Act 1901, addressing the need for a streamlined process to facilitate tariff concessions on specific goods. This legislative instrument was introduced by the Chief Executive Officer of Customs in response to an application from Bluescope Steel Ltd for a Tariff Concession Order (TCO) in respect of certain Roller Jackets and/or Electro Magnetic Stirrer Sleeves. The instrument aims to ensure that if no substitutable goods are produced in Australia, a lower rate of customs duty can be applied to the specified goods. The policy objective is to provide economic relief to industries that rely on importing specific components, thus encouraging trade and reducing costs for businesses. The Tariff Concession Instrument does not adversely affect any rights or impose new liabilities on individuals or entities, apart from potentially benefiting importers by allowing them to claim refunds on duties paid before the TCO came into effect.
Scope and Application
The Customs Act 1901, under Part XVA, governs the process for making Tariff Concession Orders (TCOs) through which the Chief Executive Officer of Customs (CEO) can reduce the rate of customs duty applicable to certain goods. This Act applies to any person or entity seeking to import goods that are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. For a TCO to be issued, the CEO must determine that the goods in question are not substitutable by any goods produced in Australia in the ordinary course of business, as defined by the Act. The scope of the Act extends to the Commonwealth level, with the CEO having the authority to make these orders. The TCO No. 0509758, for example, was issued in respect of certain Roller Jackets and/or Electro Magnetic Stirrer Sleeves after it was determined that no substitutable goods were produced in Australia, resulting in a reduction of duty from 5% to 0%. The Act ensures that the issuance of a TCO does not adversely affect the rights of any person as they stood before the TCO was registered and does not impose any liabilities on any person.
Key Provisions
The Tariff Concession Instrument No. 0509758, established under section 269F of the Customs Act 1901, provides for the application of a lower rate of customs duty on certain goods through a Tariff Concession Order (TCO). Specifically, this instrument concerns Roller Jackets and/or Electro Magnetic Stirrer Sleeves. The Act requires that for a TCO to be granted, the goods in question must not be produced in Australia and must not be substitutable by any goods that are produced domestically. If these criteria are met, the Chief Executive Officer of Customs (CEO) must make a written order declaring that the specified goods are subject to the concession, with the general duty rate of 5% reduced to 0%.
The obligations imposed by this legislation on the parties involved include ensuring that the application for a TCO is made in accordance with the Act's requirements. The CEO is mandated to publish a notice in the Gazette once an application is accepted as valid, inviting any interested parties to lodge submissions if they believe the TCO should not be made. In this case, no submissions were received. Furthermore, the Act ensures that the rights of persons, other than the Commonwealth, are not adversely affected by the TCO. The TCO also stipulates that it does not impose any new liabilities on any person.
In terms of breaches and consequences, the Customs Act 1901 does not explicitly detail specific offences or penalties related to the TCO process itself. However, general provisions of the Act apply, where breaches may result in civil or criminal penalties, including fines and imprisonment. The precise penalties would depend on the nature and severity of the breach as interpreted under the overarching provisions of the Customs Act and any related regulations.