EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0609976
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 oil film bearing water deflectors on 05 June 2006.
Instrument
TCO No 0609976 was made on 18 August 2006. It declares that those certain oil film bearing water deflectors 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 10%. 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. 0609976 is taken to have come into force on 05 June 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. 0609976 was enacted in 2006 under the Customs Act 1901 to provide a lower rate of customs duty on certain oil film bearing water deflectors. This instrument was introduced to address the need for tariff concessions for specific goods that are not produced in Australia, thereby ensuring fair trade practices and supporting the importation of essential products. The instrument was enacted by the Chief Executive Officer of Customs, following an application by Bluescope Steel Limited, and it came into force on the date the application was lodged, 5 June 2006. The objective was to provide a tariff concession without disadvantaging existing rights or imposing liabilities on any person, while allowing importers to seek refunds for duties paid prior to the concession's effective date.
Scope and Application
The Tariff Concession Instrument No. 0609976, made under Part XVA of the Customs Act 1901, applies to goods specified in the instrument, which in this case are certain oil film bearing water deflectors. This Act facilitates the application process for tariff concession orders (TCO) by allowing the Chief Executive Officer of Customs to reduce or eliminate customs duty on specific goods, provided the application meets certain criteria. The Act applies to entities or individuals who seek to import goods that are subject to a TCO, thereby benefiting from reduced or no customs duty on those goods. The scope of the Act extends to any industry that imports the specified goods, and it is designed to streamline import processes by lowering duty rates on particular goods, as determined by the CEO. The Act operates on a national level within Australia, affecting all states and territories uniformly. However, it is noted that certain goods, as specified in section 269SJ of the Customs Act 1901, are ineligible for TCOs. This particular TCO No. 0609976 came into effect on 5 June 2006, the date the application was lodged, and it does not retroactively affect any transactions or rights accrued before this date, thus ensuring that it does not impose any new liabilities or disadvantage existing parties.
Key Provisions
The primary sections of the Tariff Concession Instrument No. 0609976 under the Customs Act 1901 (sections 269C, 269B, 269P(3) and 269SJ) establish the criteria and process for Tariff Concession Orders (TCOs). These sections detail how a TCO can be applied for and granted, focusing on the condition that no substitutable goods are produced in Australia (section 269C). The instrument specifically pertains to certain oil film bearing water deflectors, which are subject to a lower rate of customs duty, as outlined in item 50 of Schedule 4 to the Customs Tariff Act 1995 (section 269P(3)). The instrument was made on 18 August 2006, and it came into effect on 5 June 2006, the date the application was lodged (subsection 269S(1)).
The obligations imposed by the Act on the Chief Executive Officer of Customs (CEO) include assessing whether an application meets the core criteria for a TCO, which is determined by whether substitutable goods are produced in Australia in the ordinary course of business (section 269C). The CEO must also publish a notice in the Gazette inviting submissions from any interested parties who might oppose the making of the TCO (subsection 269K(1)). If no submissions are received, the CEO is required to proceed with making the TCO if the application meets the criteria (section 269P(3)). The CEO did not receive any submissions in response to the notice published for this TCO.
Failure to comply with the requirements set out in the Customs Act 1901 may result in civil or criminal consequences. However, the explanatory statement does not provide specific details about offences, penalties, or consequences for breaches of the Act in the context of this TCO. The Act generally provides for various penalties for breaches of customs laws, which may include fines and imprisonment, but the exact penalties are not detailed in the explanatory statement for this particular TCO. Importers, however, will be able to apply for a refund of duty on goods imported since the date the TCO came into force (paragraph 126(1)(r) of the Regulations).