EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0516065
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 refractory resin bond hot repair powder on 17 November 2005.
Instrument
TCO No 0516065 was made on 13 February 2006. It declares that those certain refractory resin bond hot repair powders 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. 0516065 is taken to have come into force on 17 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 Customs Act 1901, enacted by the Parliament of Australia, provides for the imposition of customs duty on goods imported into Australia. Part XVA of this Act facilitates the making of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which can reduce or eliminate customs duty on certain goods. The purpose of this legislative framework is to allow for the application of lower rates of customs duty on specified goods where appropriate. In this context, Tariff Concession Instrument No. 0516065 was introduced to address a specific application by Bluescope Steel Limited for tariff concessions on certain refractory resin bond hot repair powders. The instrument was enacted on 13 February 2006, following an application lodged on 17 November 2005, and is effective from the date of the application. This instrument ensures that no substitutable goods were produced in Australia at the time of the application, thus justifying the tariff concession. The policy objective here is to provide tariff relief to importers of these specific goods, thereby facilitating their access to cheaper materials without imposing any liabilities or disadvantaging existing parties.
Scope and Application
The Tariff Concession Instrument No. 0516065 applies to the goods specified within the instrument, namely certain refractory resin bond hot repair powders, and is an application of the Customs Act 1901. The instrument was made pursuant to the authority conferred by section 269F of the Act, following an application by Bluescope Steel Limited for a Tariff Concession Order (TCO) on 17 November 2005. The instrument came into effect on the same date the application was lodged, in accordance with the commencement provisions outlined in subsection 269S(1) of the Act. The instrument's purpose is to grant tariff concessions to the specified goods, altering their customs duty rate from the general rate of 5% to free, as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995. The instrument applies to the named applicant, Bluescope Steel Limited, but its benefits extend to any importers of the specified goods, who may apply for a refund of duty under the Customs Act 1901. Importantly, the instrument does not disadvantage any person or impose any liabilities in respect of actions taken before its registration, and it does not affect the rights of persons other than the Commonwealth.
Key Provisions
The key provisions of Tariff Concession Instrument No. 0516065 under the Customs Act 1901 include the process by which Tariff Concession Orders (TCOs) are made and the circumstances in which a TCO may be granted. Section 269F (2) states that a person may apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. If the CEO is satisfied that the application meets the core criteria, as set out in section 269C, they must make a written order declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. In this case, the CEO determined that the application for certain refractory resin bond hot repair powders met the core criteria, as no substitutable goods were produced in Australia on the date the application was lodged. Consequently, the CEO issued a TCO, reducing the rate of duty on these goods from the general rate of 5% to free (Section 269P(3)).
The Act imposes several obligations on the parties involved in the TCO process. The CEO must assess whether an application meets the core criteria for a TCO by ensuring that no substitutable goods were produced in Australia on the date the application was lodged (Section 269C). Furthermore, as soon as practicable after accepting a TCO application as valid, the CEO must publish a notice in the Gazette, inviting any interested parties to lodge submissions if they believe the TCO should not be made (Subsection 269K(1)). Additionally, the CEO is required to consider any submissions received and make a decision on the application based on the criteria outlined in the Act. Importers of the goods affected by the TCO may also have obligations, such as applying for a refund of duty on goods imported since the date the TCO is taken to have come into force (Paragraph 126(1)(r) of the Regulations).
The Act does not explicitly outline specific offences, penalties, or civil/criminal consequences for breaches related to TCOs. However, the failure to comply with the requirements of the Customs Act 1901, including the process for making a TCO, could potentially result in legal action or penalties as outlined in other sections of the Act or related legislation. For instance, any person found guilty of an offence under the Customs Act 1901 could be subject to penalties such as fines, imprisonment, or both, depending on the nature and severity of the offence. It is important for all parties involved to adhere to the provisions of the Act to avoid any potential legal repercussions.