EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0601595
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 Ltd applied for a TCO in respect of certain pickle line tank parts on 29 December 2005.
Instrument
TCO No 0601595 was made on 17 March 2006. It declares that those certain pickle line tank 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 0%.
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. 0601595 is taken to have come into force on 29 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 was enacted to establish a regulatory framework for customs and border control in Australia. The Act was introduced to address the need for streamlined processes in the administration of customs duties and to provide a legal basis for the regulation of imports and exports. In 2006, Tariff Concession Instrument No. 0601595 was introduced as part of this legislative framework to facilitate tariff concessions for specific goods. This instrument was created by the Parliament of Australia and aims to provide policy objectives such as promoting fair trade practices and supporting industry competitiveness by reducing customs duties on certain goods where no substitutable Australian-made alternatives exist.
Scope and Application
The Tariff Concession Instrument No. 0601595, made under the Customs Act 1901, applies to Bluescope Steel Ltd in respect of certain pickle line tank parts, reducing the customs duty rate from 5% to 0% for these goods. The Instrument was issued following a valid application by Bluescope Steel Ltd, which met the core criteria as no substitutable goods were produced in Australia in the ordinary course of business at the time of application. The scope of the Act encompasses the authority granted to the Chief Executive Officer of Customs to make Tariff Concession Orders, thereby altering the duty rates for specific imported goods under the Customs Tariff Act 1995. This legislation applies to any entity or person seeking tariff concessions for imported goods, provided the goods do not fall within the prohibited categories specified in section 269SJ of the Act. The geographic reach of the Act is national, as it pertains to the importation of goods into Australia. The application of the Act can be further extended or restricted through subordinate instruments, such as regulations, which can provide additional criteria or conditions for tariff concessions. The Instrument itself does not disadvantage any person other than the Commonwealth and does not impose any liabilities on any person, including importers who can apply for a refund of duty on goods imported since the effective date of the Tariff Concession Order.
Key Provisions
The Tariff Concession Instrument No. 0601595 under the Customs Act 1901 provides for a reduction in customs duty for certain pickle line tank parts, as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995 (sections 269F and 269P(3)). This instrument was enacted to ensure that if the Chief Executive Officer of Customs (CEO) is satisfied that no substitutable goods are produced in Australia, a lower rate of duty applies to the goods in question. In this case, the general rate of duty is reduced from 5% to 0% for the specified parts (section 269C).
The obligations imposed by this legislation are primarily on the CEO, who must assess whether an application for a Tariff Concession Order (TCO) meets the core criteria. If the CEO determines that no substitutable goods are produced in Australia, they are mandated to issue a written TCO, effectively lowering the duty on the specified goods (sections 269K and 269P(3)). Additionally, the CEO is required to publish a notice in the Gazette, inviting any interested parties to submit their views on why the TCO should not be granted, although no submissions were received for this particular TCO (section 269K(1)).
Failure to comply with the provisions of the Customs Act 1901 in relation to TCOs could result in significant consequences. While the specific Act does not detail penalties for breaches, the broader legislative framework of the Customs Act 1901 and associated regulations could impose civil or criminal penalties for non-compliance. These may include fines, imprisonment, or other sanctions as prescribed by the relevant legislation. The exact penalties would depend on the nature and severity of the breach.