EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0515401
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 hot rolled steel sheet unpickled in coils on 07 November 2005.
Instrument
TCO No 0515401 was made on 23 January 2006. It declares that those certain hot rolled steel sheets unpickled in coils 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. 0515401 is taken to have come into force on 07 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. 0515401 was enacted in 2006 under the Customs Act 1901 with the purpose of providing tariff concessions for specific goods, reducing the customs duty rate for these goods. This instrument was introduced to address the need for a streamlined process for businesses to apply for lower customs duty rates on goods that are not produced in Australia and for which there are no suitable substitutes available domestically. The instrument was made by the Chief Executive Officer of Customs, in accordance with the provisions of the Customs Act 1901, and it specifies the tariff concession for certain hot rolled steel sheets unpickled in coils. The policy objective is to facilitate trade by providing tariff concessions that benefit importers without imposing any liabilities or disadvantaging any person other than the Commonwealth. The Tariff Concession Order No. 0515401 was published in the Gazette and no submissions were received against its implementation.
Scope and Application
The Customs Act 1901, specifically through its Tariff Concession Orders (TCO) provisions under Part XVA, allows the Chief Executive Officer of Customs to reduce the customs duty rates for certain goods if the application for such a concession meets specific criteria. This legislative framework applies to any person or entity seeking to import goods eligible for a tariff concession, provided the goods do not fall under the list of items excluded in section 269SJ of the Act. The TCO mechanism aims to facilitate the importation of goods for which no substitutable products are produced domestically, as outlined in sections 269C, 269D, and 269E. The application process requires the applicant to demonstrate that no substitutable goods are produced in Australia, and if satisfied, the CEO issues a TCO which specifies the reduced customs duty applicable to the goods in question. The application and subsequent concession are subject to publication and invitation for public submissions, although in the case of TCO No. 0515401, no submissions were received. The concession takes effect from the date the application is lodged, and it does not retroactively affect the rights of any person other than the Commonwealth. The application of the Act is national in scope, covering all states and territories within Australia.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0515401 under the Customs Act 1901 (section 269F) pertain to the application process for Tariff Concession Orders (TCOs). Specifically, section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO regarding certain goods. If the CEO determines that the application is valid and does not pertain to goods that cannot be subject to a TCO, as outlined in section 269SJ, the CEO must assess whether the application meets the core criteria established by section 269C. This core criteria requirement stipulates that, on the date of the application, no substitutable goods were produced in Australia in the ordinary course of business. If the CEO is satisfied that the application meets these criteria, they must make a written TCO (section 269P(3)). For example, in TCO No. 0515401, certain hot rolled steel sheets unpickled in coils are subject to a tariff concession, as the CEO determined no substitutable goods were produced in Australia.
The Customs Act 1901 imposes several obligations on the parties involved in the TCO process. For applicants, the primary obligation is to ensure that their application is valid and meets the core criteria. This includes providing sufficient evidence that no substitutable goods were produced in Australia on the date of application. The CEO has the responsibility to review the application, assess whether it meets the core criteria, and make a decision based on the evidence presented. Additionally, once an application is accepted as valid, the CEO must publish a notice in the Gazette (subsection 269K(1)) inviting any interested parties to lodge submissions if they believe the TCO should not be made. In this case, no submissions were received.
The Customs Act 1901 also outlines potential consequences for non-compliance with the Act's provisions. Although the explanatory statement does not detail specific offences, breaches of the Act could lead to various civil and criminal penalties. For instance, providing false information in an application could be considered a misleading or deceptive conduct under the Australian Consumer Law, potentially resulting in fines or other penalties. Similarly, any misuse of a TCO could lead to legal action, including the imposition of additional duties or fines. The explanatory statement does not provide maximum penalties for these potential breaches, but they would generally be in line with other breaches of the Customs Act 1901.