EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0618624
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.
Onesteel Manufacturing Pty Ltd applied for a TCO in respect of certain ladle weighers on 17 November 2006.
Instrument
TCO No 0618624 was made on 2 February 2007. It declares that those certain ladle weighers 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. 0618624 is taken to have come into force on 17 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 Tariff Concession Instrument No. 0618624 was enacted under the Customs Act 1901 to address the need for providing tariff concessions for specific imported goods. This instrument was issued in response to an application by Onesteel Manufacturing Pty Ltd for a tariff concession order (TCO) concerning certain ladle weighers, with the aim of providing a lower rate of customs duty on these goods. The Chief Executive Officer of Customs (CEO) was satisfied that the application met the core criteria, specifically that no substitutable goods were produced in Australia at the time of application, leading to the establishment of the TCO which effectively reduced the duty rate from 5% to 0%. The instrument was published in the Gazette with an invitation for submissions, though none were received. The tariff concession order came into force on the date the application was lodged, 17 November 2006, and it benefits importers by allowing them to apply for a refund of duty paid on the goods imported since that date, without imposing any new liabilities.
Scope and Application
The Tariff Concession Instrument No. 0618624 under the Customs Act 1901 applies specifically to certain ladle weighers and is administered by the Chief Executive Officer of Customs. This legislation is pertinent to individuals and entities that are involved in the importation of these specific goods, ensuring they are aware of the applicable duty rates. The geographic and jurisdictional reach of this Act is national, as it operates under the auspices of the Commonwealth of Australia. The Act’s application is confined to goods specified in the application, and it does not extend to goods listed in section 269SJ of the Customs Act 1901, which includes those goods that cannot be subject to a Tariff Concession Order. The application process mandates that if no substitutable goods are produced in Australia, the CEO must grant the Tariff Concession Order, thereby reducing the duty rate from the general 5% to 0%. Furthermore, this order is retroactive to the date of the application, which was 17 November 2006, and does not impose any liabilities on any person beyond this date. The CEO published a notice in the Gazette inviting any interested parties to lodge submissions, but none were received, leading to the instrument's registration on 2 February 2007.
Key Provisions
The main sections of the Tariff Concession Instrument No. 0618624 under the Customs Act 1901 (section 269F) require the Chief Executive Officer (CEO) of Customs to assess applications for Tariff Concession Orders (TCOs). Section 269C stipulates that an application meets the core criteria if no substitutable goods were produced in Australia on the day the application was lodged, as defined by sections 269D and 269E of the Act. If the CEO determines that the application meets these criteria, they must issue a TCO, as per section 269P(3). This particular TCO, No. 0618624, specifies that certain ladle weighers are subject to a 0% customs duty rate, down from the general rate of 5%, as outlined in item 50 of Schedule 4 to the Customs Tariff Act 1995.
The obligations imposed by the Act on parties or entities governed by this legislation include ensuring that applications for TCOs are submitted in accordance with the provisions set out in sections 269F and 269C. The CEO must then assess whether the application meets the core criteria and make a decision on the issuance of the TCO within the stipulated timeframe. Once the TCO is issued, the entities involved must adhere to the terms of the order, which in this case involves the importation of ladle weighers at a reduced duty rate.
Failure to comply with the requirements of the Customs Act 1901 can result in various civil and criminal consequences. The Act does not explicitly detail the specific penalties for non-compliance with the TCO provisions; however, general penalties for breaches of the Customs Act may apply. These could include fines, imprisonment, or both, depending on the nature and severity of the breach. The maximum penalties for breaches of customs regulations can be substantial, with fines reaching up to $126,000 for individuals and $630,000 for corporations, alongside potential imprisonment terms of up to five years for serious offences. Additionally, there may be further civil liabilities for any financial losses caused by non-compliance.
The TCO, No. 0618624, which came into force on 17 November 2006, does not adversely affect the rights of any person, except the Commonwealth, and does not impose any liabilities on any person in respect of actions taken before the date of registration. Importers of the specified goods can benefit from applying for a refund of duty on goods imported since the effective date of the TCO, as per paragraph 126(1)(r) of the Regulations. The CEO is required to publish a notice in the Gazette inviting submissions from any interested parties, although no submissions were received in response to the notice for this particular TCO.