EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0618437
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 10 November 2006.
Instrument
TCO No 0618437 was made on 19 January 2007. 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. 0618437 is taken to have come into force on 10 November 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 was enacted to provide a comprehensive framework for the regulation of customs and excise duties, as well as other border control measures. The Act was introduced to address the need for a systematic approach to managing the import and export of goods, ensuring compliance with Australian laws, and protecting the economic interests of the nation. The Tariff Concession Instrument No. 0618437 was made under the authority of the Customs Act 1901 by the Parliament of Australia. This instrument was introduced to provide tariff concessions for certain goods, in this case, pickle line tank parts, by reducing the customs duty from 5% to 0%. The policy objective of this instrument is to provide relief to importers by lowering the duty on these specific goods, thereby encouraging trade and potentially lowering costs for businesses that rely on these parts.
Scope and Application
The Tariff Concession Instrument No. 0618437 under the Customs Act 1901 applies specifically to the goods that are the subject of a Tariff Concession Order (TCO) made by the Chief Executive Officer of Customs (CEO). This legislation is aimed at entities or individuals who are seeking to import goods for which they wish to benefit from reduced customs duty rates. The application of this Act is national, operating under the Commonwealth framework, but its effects are directly felt in the context of international trade and the importation of specific goods into Australia. It is pertinent to note that the Act does not apply to goods specified in section 269SJ of the Customs Act 1901, which outlines those goods that cannot be subject to a TCO. The Act may also be extended or further defined through subordinate instruments, which can provide additional specificity or exceptions not covered in the primary text.
Key Provisions
The main operative sections of the Tariff Concession Order (TCO) No. 0618437 are contained within sections 269C, 269P, and 269S of the Customs Act 1901. According to section 269C, the Chief Executive Officer of Customs (CEO) must determine whether an application for a TCO meets the core criteria, specifically whether no substitutable goods were produced in Australia on the day the application was lodged. If the core criteria are met, the CEO must then issue a TCO under section 269P, which declares that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, with a reduced or zero rate of customs duty. Section 269S outlines the commencement date of a TCO, which is typically the date on which the application was lodged, ensuring that the tariff concession is effective from the application date.
The Customs Act 1901 imposes certain obligations on the CEO when processing a TCO application. Firstly, under section 269K, the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made. The CEO must consider these submissions before deciding whether to issue the TCO. Additionally, the CEO must ensure that the application does not pertain to goods specified in section 269SJ, which cannot be subject to a TCO. If the application meets all the specified criteria and no disqualifying submissions are received, the CEO must proceed to issue the TCO, as mandated by section 269P. Furthermore, the Act stipulates that the TCO does not affect the rights of any person as at the date of registration in a manner that would disadvantage them or impose liabilities for actions taken before the TCO was registered.
Breaching the obligations or requirements outlined in the Customs Act 1900 could result in various civil or criminal consequences. While the explanatory statement does not detail specific penalties for breaches related to the issuance or misuse of TCOs, general penalties for contravening the Customs Act can include fines and imprisonment. For example, section 244 of the Act provides for penalties for fraudulent or negligent acts, which could include fines of up to $22,200 and imprisonment for up to five years. Additionally, the Tariff Concession Orders Regulation 2014 may impose specific penalties for non-compliance with TCO provisions, which could include financial penalties or other regulatory actions. These consequences underscore the importance of adhering to the statutory requirements and ensuring that TCOs are issued and applied correctly.