EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0608567
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 exit scrap conveyors on 15 May 2006.
Instrument
TCO No 0608567 was made on 4 August 2006. It declares that those certain exit scrap conveyors 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. 0608567 is taken to have come into force on 15 May 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. 0608567 was enacted in 2006 under the Customs Act 1901. This Act, administered by the Parliament of Australia, provides a framework for tariff concession orders which allow for a lower rate of customs duty on certain goods. This particular instrument was introduced to address the need for tariff concessions on specific goods, such as certain exit scrap conveyors, where no substitutable goods were produced in Australia. The policy objective behind this concession is to support industries by reducing the cost of importing necessary goods, thereby promoting competitive markets and economic efficiency.
The instrument was created in response to an application by Bluescope Steel Ltd for a tariff concession order on certain exit scrap conveyors, which was accepted by the Chief Executive Officer of Customs. The CEO determined that no substitutable goods were being produced in Australia, thus satisfying the core criteria for a tariff concession. This led to the establishment of a zero percent duty rate for these specific goods, as opposed to the general rate of 5%. The instrument was published in the Gazette with an invitation for submissions, none of which were received, and it came into force on the date of the application, 15 May 2006. This concession does not disadvantage any person other than the Commonwealth and allows importers to apply for a refund of duty on goods imported since the effective date of the concession.
Scope and Application
The Customs Act 1901, specifically Part XVA, provides a framework under which the Chief Executive Officer of Customs can make Tariff Concession Orders (TCOs). These orders apply to goods for which a lower rate of customs duty is specified. An application for a TCO can be made by any person under section 269F of the Act, provided the goods do not fall under the exclusions outlined in section 269SJ. If the CEO determines that the application meets the core criteria, notably the absence of substitutable goods produced in Australia as per section 269C, a TCO is issued under section 269P(3). The application process requires the CEO to publish a notice in the Gazette inviting objections, although in this case, no submissions were received. The TCO takes effect from the date the application was lodged, and it does not disadvantage any person or impose liabilities for actions taken before its registration. Importers of the affected goods can apply for a refund of duty from the commencement date of the TCO. The application of the TCO is subject to the broader regulatory framework under the Customs Tariff Act 1995.
Key Provisions
The main operative sections of the Customs Act 1901, specifically as they pertain to Tariff Concession Orders (TCOs), include sections 269C, 269F, 269S, and 269P. Section 269F enables a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO concerning certain goods. If the CEO determines that the application is not for goods specified in section 269SJ, which lists those goods that cannot be subject to a TCO, the CEO must assess whether the application meets the core criteria set out in section 269C. If the CEO is satisfied that the application meets these criteria, they are required under section 269P to issue a written TCO. This order declares that the goods in question are subject to a prescribed rate of duty specified in the order.
The Customs Act 1901 imposes several obligations and requirements on parties and entities it governs. For example, section 269C mandates that the CEO must decide whether an application for a TCO meets the core criteria, which includes ensuring that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Additionally, section 269K(1) requires the CEO to publish a notice in the Gazette inviting any interested parties to submit objections to the TCO if they believe there are reasons it should not be made. The CEO must then consider these submissions before making a final decision.
Failure to comply with the requirements of the Customs Act 1901 can result in various penalties and consequences. Section 269SJ lists goods that cannot be subject to a TCO, and applications for these goods will be rejected. Moreover, section 269P(3) stipulates that the CEO must make a written order if the application meets the core criteria. While the specific penalties for breaches are not detailed in the explanatory statement, it is implied that non-compliance with the Act could lead to legal repercussions, including potential fines or other civil and criminal penalties as prescribed by the relevant sections of the Act. The exact penalties would depend on the nature and severity of the breach.