EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0615152
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 cooling rolls on 29 September 2006.
Instrument
TCO No 0615152 was made on 22 December 2006. It declares that those certain cooling rolls 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. 0615152 is taken to have come into force on 29 September 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 Customs Act 1901, enacted by the Parliament of Australia, establishes a framework for the imposition and regulation of customs duties. The Act introduced a scheme allowing for Tariff Concession Orders (TCOs) to be made by the Chief Executive Officer of Customs. This scheme aims to address the need for tariff relief for specific goods under certain conditions. The Tariff Concession Instrument No. 0615152, made under the authority of the Customs Act, provides a practical application of this scheme. In this instance, Bluescope Steel Ltd applied for a TCO concerning certain cooling rolls, which was approved on the basis that no substitutable goods were being produced in Australia. Consequently, a lower rate of customs duty was applied to these goods. The policy objective of this measure is to facilitate trade by reducing the duty on specific imported goods, thereby benefiting importers who can apply for refunds on duties paid prior to the TCO's effective date.
Scope and Application
The Tariff Concession Instrument No. 0615152 under the Customs Act 1901 applies to the specific case of Bluescope Steel Ltd’s application for a Tariff Concession Order (TCO) concerning certain cooling rolls. The legislation is administered by the Chief Executive Officer of Customs, who must determine if the application for a TCO meets the core criteria set out in the Act. This involves confirming that no substitutable goods were produced in Australia at the time of the application. The scope of the Act extends to any person or entity seeking a tariff concession for goods that are not specified as ineligible under section 269SJ of the Act. The instrument applies nationally, given its basis in Commonwealth legislation, and it is effective from the date the application was lodged, which is 29 September 2006. Notably, the TCO does not adversely affect the rights of any person other than the Commonwealth and does not impose any liabilities on individuals or entities. The CEO is also required to publish a notice in the Gazette inviting submissions from interested parties, although in this instance, no submissions were received.
Key Provisions
The Customs Act 1901 (the Act), particularly Part XVA, allows the Chief Executive Officer of Customs (CEO) to issue Tariff Concession Orders (TCOs) which provide lower rates of customs duty on specified goods (section 269F). To qualify for a TCO, the application must meet the core criteria set out in section 269C, which requires that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (section 269C). Definitions of key terms, such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods', are provided in sections 269D, 269E, and 269F respectively. If the CEO is satisfied that the application meets these criteria, they must issue a written order (section 269P(3)).
The obligations imposed on applicants under this legislation include the requirement to submit an application to the CEO and provide sufficient information to demonstrate that the application meets the core criteria (section 269F). The CEO is obligated to assess the application against the criteria, consult with relevant parties by publishing a notice in the Gazette inviting submissions (section 269K(1)), and decide whether to issue a TCO. The TCO, once issued, applies from the date the application was lodged (section 269S(1)). The CEO’s decision-making process must ensure that the rights of existing parties are not adversely affected and that the concession does not impose new liabilities on them.
Failure to comply with the requirements of the Act, such as submitting a false application or providing misleading information, could result in legal consequences. However, the explanatory statement does not explicitly mention offences, penalties, or specific civil or criminal consequences for breaches of the Act. Instead, it emphasises the procedural correctness in applying for and issuing TCOs, with the focus on ensuring that the rights of importers and other stakeholders are protected and not adversely affected by the issuance of a TCO. The explanatory statement does not detail maximum penalties for non-compliance but implies that the Act provides for such measures to maintain its integrity.