EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0516761
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 Pty Ltd applied for a TCO in respect of certain dilution fans on 8 December 2005.
Instrument
TCO No 0516761 was made on 13 February 2006. It declares that certain scale scraper beam parts 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. 0516761 is taken to have come into force on 8 December 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 Australian Parliament, establishes a framework for the administration of customs duties and provides the authority for the Chief Executive Officer of Customs to issue Tariff Concession Orders (TCOs). These orders allow for the application of a lower rate of customs duty on certain goods. The Tariff Concession Instrument No. 0516761 was introduced to address the specific needs of Bluescope Steel Pty Ltd, which applied for a concession on certain dilution fans. This instrument was enacted to ensure that no substitutable goods were produced in Australia, thus meeting the core criteria set out in section 269C of the Act. The policy objective here is to facilitate the importation of goods that are not produced domestically, thereby supporting trade and potentially reducing costs for importers. The instrument became effective on the date the application was lodged, 8 December 2005, and importers can apply for refunds of duty paid on these goods since that date.
Scope and Application
The Tariff Concession Instrument No. 0516761 under the Customs Act 1901 applies to any individual or entity that imports goods eligible for tariff concessions. This legislation is pertinent to those who seek to benefit from reduced customs duties on specific imported goods, provided that such goods are not substitutable by products manufactured within Australia. The scope of the Act extends to the entire Commonwealth of Australia, as it is a federal statute. However, the application of this legislation is restricted to goods that are not listed in section 269SJ of the Customs Act 1901, which excludes certain goods from tariff concessions. The application process for a Tariff Concession Order (TCO) involves an assessment by the Chief Executive Officer of Customs, who must be satisfied that no substitutable goods are produced in Australia in the ordinary course of business. Once a TCO is registered, it applies retroactively to the date the application was lodged, and it does not disadvantage any person other than the Commonwealth nor impose any liabilities on persons for actions taken before the registration date. The instrument may be further extended or modified through subordinate legislation, which allows for detailed regulation of the tariff concessions scheme.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0516761 are sections 269C, 269P, and 269S. Section 269C stipulates that a Tariff Concession Order (TCO) application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269P(3) requires the Chief Executive Officer (CEO) of Customs to make a written order declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995 if satisfied that the application meets the core criteria. Section 269S 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.
The Act imposes specific obligations and requirements on parties applying for a TCO. An applicant, such as Bluescope Steel Pty Ltd in this case, must ensure that the application is lodged under the correct provisions and that the goods in question are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. The CEO has the responsibility to assess whether the application meets the core criteria by verifying that no substitutable goods were produced in Australia on the application date. Additionally, the CEO must publish a notice in the Gazette, inviting submissions from any interested parties regarding the TCO application, although no submissions were received in this instance.
The Act also outlines potential consequences for non-compliance with its provisions. While specific offences and penalties are not detailed within the text, it can be inferred that failure to adhere to the requirements for a TCO application or improper use of a TCO could lead to civil or criminal consequences. For example, incorrect application or misuse of a TCO might result in the imposition of additional duties, fines, or other penalties as prescribed under the Customs Act 1901 and associated regulations. The precise nature and maximum penalties would be determined based on the specific breach and the relevant provisions of the Act and any subordinate legislation.