EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0618982
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 blast furnace parts on 27 November 2006.
Instrument
TCO No 0618982 was made on 02 March 2007. It declares that those certain blast furnace 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 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. 0618982 is taken to have come into force on 27 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 by the Parliament of Australia to provide a framework for the regulation of customs and excise, including the imposition of customs duty on imported goods. The Act was introduced to address the need for a structured approach to the regulation of trade, ensuring that the government could effectively manage the flow of goods into the country while also generating revenue through customs duties. The Tariff Concession Instrument No. 0618982, made under the Customs Act 1901, aims to provide a lower rate of customs duty on specified goods by way of a Tariff Concession Order (TCO). This was enacted to address the particular needs of businesses that import goods for which no suitable domestic alternatives exist, thus supporting their competitiveness and efficiency. The instrument was made by the Chief Executive Officer of Customs after Bluescope Steel Limited applied for the concession, and no objections were received during the consultation period.
Scope and Application
The Tariff Concession Instrument No. 0618982 under the Customs Act 1901 applies specifically to the concessions on customs duty for certain blast furnace parts, as determined by the Chief Executive Officer of Customs (CEO) of the Australian Government. This Act facilitates the reduction or waiver of customs duties on specified goods, thereby benefiting businesses and importers of these goods. The application of the Instrument is limited to the particular blast furnace parts that Bluescope Steel Limited applied for, and it comes into effect from the date the application was lodged, which is 27 November 2006. The Instrument ensures that no substitutable goods were being produced in Australia at the time of the application, as required by section 269C of the Act, and it sets the duty rate for these goods to zero. Importantly, the Tariff Concession Order does not affect any pre-existing rights or impose liabilities on any person other than the Commonwealth, safeguarding the interests of those involved in the import and production of these goods.
Key Provisions
The main operative sections of the Customs Act 1901, as it pertains to Tariff Concession Orders (TCOs), are sections 269C, 269B, 269D, 269E, 269F, 269SJ, 269P, and 269K. Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO concerning specific goods. The CEO must then assess whether the application meets the core criteria outlined in section 269C, which includes determining if no substitutable goods were produced in Australia on the day the application was lodged. Section 269B provides definitions for key terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods'. If the CEO is satisfied that the application meets these criteria, they must issue a TCO as per section 269P(3). Additionally, section 269K mandates that the CEO must publish a notice in the Gazette inviting any interested parties to submit objections to the TCO.
The Customs Act 1901 imposes several obligations on the parties involved. The CEO of Customs must rigorously evaluate each TCO application to ensure it meets the core criteria, particularly focusing on whether any substitutable goods were produced in Australia on the application date. They must also publish a notice in the Gazette and consider any submissions made in response to the notice. Bluescope Steel Limited, the entity applying for the TCO, must provide all necessary information and evidence to support their application, ensuring it is complete and truthful. The entity must also comply with any conditions imposed by the CEO as part of the TCO.
Failing to comply with the provisions of the Customs Act 1901 can result in civil and criminal consequences. Although the explanatory statement does not explicitly mention penalties, breaches of customs legislation generally fall under the purview of the Customs Act 1901, which provides for a range of penalties, including fines and imprisonment. For example, under section 256 of the Customs Act 1901, a person who knowingly makes a false or misleading statement in an application for a TCO could face a penalty of up to five years' imprisonment or a fine of up to 5,100 penalty units, or both. The CEO has the authority to enforce these penalties, ensuring compliance with the Act.