EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0511963
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 (AIS) Pty Ltd applied for a TCO in respect of walking beam furnace fans on 8 September 2005.
Instrument
TCO No 0511963 was made on 25 November 2005. It declares that those certain walking beam furnace fans 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 free.
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.0511963 is taken to have come into force on 8 September 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 to manage the importation of goods into Australia, including setting the rates of duty and providing mechanisms for tariff concessions. This Act was introduced to address the need for a structured approach to tariff reductions and concessions to support Australian industries and consumers. The Tariff Concession Instrument No. 0511963, made under this Act, was introduced to provide tariff concessions to specific goods, facilitating lower customs duty rates on those items and thus benefiting certain industries. The instrument was enacted by the Parliament of Australia with the objective of promoting fair trade practices and supporting the competitiveness of Australian businesses by reducing the cost of importing specific goods. The instrument is designed to ensure that if no substitutable goods are produced in Australia, then a lower rate of duty can be applied to the specified goods, aiding in their affordability and availability in the local market.
Scope and Application
The Tariff Concession Instrument No. 0511963 applies to specific goods, namely walking beam furnace fans, as designated by the Customs Act 1901. The Act allows the Chief Executive Officer of Customs to grant a Tariff Concession Order (TCO) if certain criteria are met, such as the absence of substitutable goods produced in Australia at the time the application was lodged. This instrument is applicable to entities involved in the import of these goods, thereby granting them tariff concessions and effectively reducing the customs duty on these items from the general rate of 5% to free. The geographic reach of this Act is national, as it pertains to the Commonwealth of Australia and its customs regulations. The application of this Act is not restricted by any stated exclusions, exemptions, or thresholds beyond what is specified in section 269SJ of the Customs Act 1901, which excludes certain goods from being subject to a TCO. The Act may extend or restrict its application through subordinate instruments, but no such extensions or restrictions are mentioned in the explanatory statement.
Key Provisions
The primary operative sections of this legislation include sections 269C, 269F, and 269P of the Customs Act 1901, which provide the framework for applying for and granting Tariff Concession Orders (TCOs). Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of certain goods. If the CEO is satisfied that the application meets the core criteria, including that no substitutable goods are produced in Australia (as outlined in section 269C), the CEO must make a TCO, which is a written order declaring that the goods in question are subject to a prescribed lower rate of customs duty (section 269P(3)).
The obligations and requirements imposed by the Act include the necessity for the CEO to ensure that any TCO application does not pertain to goods specified in section 269SJ, which are ineligible for tariff concessions. The CEO must also determine whether the application meets the core criteria specified in section 269C, which includes verifying that no substitutable goods are produced in Australia. If the CEO is satisfied with the application, they must publish a notice in the Gazette inviting any objections and consider any submissions received. Once the TCO is made, it is effective from the date the application was lodged, as stipulated in subsection 269S(1). Importantly, the TCO does not affect the rights of any person, except to the extent that it provides benefits such as potential refunds of duty for importers of the affected goods.
There are no specific offences, penalties, or consequences outlined in the Act for the breach of its provisions concerning TCOs. However, the Act ensures that the implementation of a TCO does not disadvantage any person or impose liabilities for actions taken before the TCO's effective date. The primary consequence of a TCO is the alteration of customs duty rates for the specified goods, which can benefit importers by potentially entitling them to refunds of duty paid on those goods since the effective date of the TCO.