EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0515398
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 unpickled hot rolled steel sheet on 04 November 2005.
Instrument
TCO No 0515398 was made on 23 January 2006. It declares that those certain unpickled hot rolled steel sheets 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. 0515398 is taken to have come into force on 04 November 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. 0515398, enacted in 2006, amends the Customs Act 1901 to provide tariff concessions on certain unpickled hot rolled steel sheets. This legislative instrument was introduced to address the need for specific tariff reductions for certain imported goods, in this case, steel sheets, to ensure they are not subject to higher duties than those that would apply if they were produced domestically. The instrument was enacted by the Commonwealth Parliament and aims to facilitate the importation of these goods by applying a reduced or free rate of customs duty, thereby addressing potential economic barriers to trade. The process involves an application to the Chief Executive Officer of Customs, who evaluates whether the application meets the core criteria and decides on the tariff concession order accordingly.
The instrument was implemented following a successful application by Bluescope Steel Limited, which sought the tariff concession for certain unpickled hot rolled steel sheets, effective from the date the application was lodged. The concession provides a free rate of duty on these goods, significantly lowering the financial burden on importers. The enactment of this instrument aligns with the policy objective of promoting fair and competitive trade practices by ensuring that imported goods are not unduly disadvantaged compared to locally produced alternatives.
Scope and Application
The Customs Act 1901, specifically under Part XVA, outlines the process through which Tariff Concession Orders (TCO) can be issued by the Chief Executive Officer of Customs (CEO). This legislation applies to any person or entity that wishes to apply for a tariff concession in respect of goods, provided these goods are not specified in section 269SJ of the Act. The application process requires the applicant to demonstrate that no substitutable goods are produced in Australia, as defined under sections 269D and 269E, thereby meeting the core criteria set out in section 269C. The geographic and jurisdictional reach of this Act is national, applying across the Commonwealth of Australia. There are no exclusions or exemptions outlined within the explanatory statement, although the application process does exclude certain goods as per section 269SJ. The application of this Act may be further detailed or adjusted through subordinate instruments, such as regulations or further orders, but these are not elaborated upon in the provided text.
Key Provisions
The Tariff Concession Instrument No. 0515398 under the Customs Act 1901 provides a concessional tariff treatment for certain unpickled hot rolled steel sheets. Pursuant to section 269F, the Chief Executive Officer (CEO) of Customs is responsible for making Tariff Concession Orders (TCOs) when an application is made by a person and it is established that the goods in question do not have substitutable Australian-produced equivalents (section 269C). In this case, Instrument 0515398 was made on 23 January 2006, following an application by Bluescope Steel Limited on 4 November 2005. The TCO specifies that these goods are subject to item 50 of Schedule 4 of the Customs Tariff Act 1995, resulting in a duty-free rate for these goods, down from the general rate of 5%.
The obligations under this Act primarily involve the CEO, who must ensure that applications for TCOs are assessed against the criteria outlined in section 269C, including verifying the absence of substitutable goods produced in Australia. The CEO is also mandated to publish a notice in the Gazette as soon as practicable after accepting a valid application, inviting any interested parties to submit any reasons why the TCO should not be made (subsection 269K(1)). In this instance, no submissions were received in response to the published notice.
The Act does not impose direct obligations on entities other than the Commonwealth, but it does provide benefits to importers. Importers of the specified goods can apply for a refund of duty on goods imported since the TCO is deemed to have come into force on the date the application was lodged (subsection 269S(1)). Importantly, the TCO does not affect any pre-existing rights of persons (other than the Commonwealth) and does not impose any new liabilities on any person.
Breaching the provisions of the Customs Act 1901 that govern the application and implementation of TCOs can lead to various civil and criminal consequences. The specifics of these penalties are not detailed in the explanatory statement, but generally, the Act provides for penalties for non-compliance with its requirements. Such penalties can include fines and, in some cases, imprisonment, depending on the severity and intent of the breach. However, the maximum penalties are not explicitly stated in this particular explanatory statement.