EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0601822
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 walking beam furnace parts on 05 January 2006.
Instrument
TCO No 0601822 was made on 17 March 2006. It declares that those certain walking beam furnace 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. 0601822 is taken to have come into force on 05 January 2006.
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. 0601822, enacted in 2006, is an amendment to the Customs Act 1901, designed to address the need for tariff concessions on certain imported goods. This legislation allows for the application of reduced or free customs duty on specified goods that are not produced in Australia and for which no suitable substitute is available domestically. The Tariff Concession Order (TCO) scheme is managed by the Chief Executive Officer of Customs, who assesses applications based on criteria outlined in the Customs Act, such as the absence of substitutable goods produced in Australia. Bluescope Steel Limited’s application for a TCO on specific walking beam furnace parts was approved, resulting in a duty rate of free, which contrasts with the general duty rate of 5%. The instrument does not affect existing rights or impose new liabilities on individuals, except for the beneficial change in duty rates for importers.
Scope and Application
The Tariff Concession Instrument No. 0601822 under the Customs Act 1901 applies specifically to certain walking beam furnace parts for which Bluescope Steel Limited submitted an application on 05 January 2006. The instrument is applicable to the goods specified in the application, with the purpose of granting a tariff concession that reduces the duty rate from the general rate of 5% to free. This applies to the particular industry involved in the production or importation of these furnace parts and is limited to the conduct of applying for and receiving a tariff concession order. The geographical scope of the Act is national, as it operates under the Commonwealth of Australia, and the instrument extends to all relevant parties within this jurisdiction. The Act does not specify exclusions or exemptions other than those outlined in section 269SJ of the Act, which prohibits certain goods from being subject to a tariff concession order. Additionally, the application of the Act may be further extended or restricted through subordinate instruments as necessary.
Key Provisions
The Tariff Concession Instrument No. 0601822, as referenced in the Customs Act 1901, specifically addresses the application of Tariff Concession Orders (TCOs) to certain goods, in this case, walking beam furnace parts. Section 269F allows for an application to the Chief Executive Officer (CEO) of Customs for a TCO, provided that the goods do not fall under the category specified in section 269SJ. For an application to be considered, section 269C stipulates that it must meet the core criteria, which include the absence of substitutable goods produced in Australia on the date of application, as defined by section 269D. If the CEO is satisfied that the application meets these criteria, they are mandated to issue a written order under section 269P(3) that declares the goods to which the concession applies.
In compliance with subsection 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any interested parties who believe the TCO should not proceed. In the case of TCO No. 0601822, no submissions were received, indicating general acceptance or lack of opposition to the concession. The commencement of the TCO, as per subsection 269S(1), is deemed to be effective from the date the application was lodged, which in this instance was 05 January 2006. This means that the TCO has been in effect from that date, benefiting the rights of importers who can now apply for duty refunds on goods imported since the concession came into force.
The obligations imposed by this Act on the parties involved are primarily centred around the application process and the criteria for eligibility. The CEO must ensure that the application is valid and meets the core criteria set out in the Act. Bluescope Steel Limited, as the applicant, must provide all necessary information to substantiate their application. Additionally, any interested parties have an opportunity to voice their objections by submitting to the CEO. The Act ensures that the rights of persons other than the Commonwealth are not adversely affected by the TCO, and that no new liabilities are imposed on these parties. Importers, as beneficiaries of the TCO, are entitled to apply for duty refunds for goods imported since the TCO's effective date.
Breaching the provisions of the Customs Act 1901, particularly in relation to the improper application or misuse of a TCO, can lead to various legal consequences. While the specific penalties for such breaches are not detailed in the explanatory statement, it is known that violations of customs legislation can result in both civil and criminal penalties. Civil penalties may include fines, while criminal penalties can involve imprisonment, reflecting the seriousness with which customs breaches are treated under Australian law. The exact penalties would depend on the nature and severity of the breach, as well as any applicable provisions within the broader customs and tariff framework.