EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0619743
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 fired refractory bricks and/or shapes on 12 December 2006.
Instrument
TCO No 0619743 was made on 09 March 2007. It declares that those certain fired refractory bricks and/or shapes 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. 0619743 is taken to have come into force on 12 December 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 for the administration of customs and excise duties. This Act includes provisions for Tariff Concession Orders (TCOs), which were introduced to address the problem of ensuring that certain goods imported into Australia do not compete with goods produced domestically, thereby protecting local industries. Specifically, the Act allows the Chief Executive Officer of Customs to grant tariff concessions on imported goods if it is determined that there are no substitutable goods produced in Australia. The policy objective behind this mechanism is to facilitate the import of goods where local production does not exist, thus supporting trade and potentially lowering costs for consumers and businesses. The Explanatory Statement for Tariff Concession Instrument No. 0619743, which was made under this Act, clarifies the process and criteria for granting such concessions, ensuring transparency and fairness in the application process.
Scope and Application
The Tariff Concession Instrument No. 0619743 under the Customs Act 1901 applies to specific entities or individuals who seek tariff concessions on goods imported into Australia, particularly focusing on certain fired refractory bricks and/or shapes. This legislation is applicable to those who have applied for and received a Tariff Concession Order (TCO) from the Chief Executive Officer of Customs (CEO). The scope of this Act extends to the assessment and approval process for tariff concessions, ensuring that no substitutable goods are produced in Australia, as per the outlined criteria. The instrument benefits importers by providing them with the opportunity to apply for a refund of duty on goods imported since the date the TCO is taken to have come into force. This legislation operates on a national level, providing a framework for tariff concessions that can be applied across all states and territories in Australia. The Act does not disadvantage any existing rights or impose liabilities on persons other than the Commonwealth, ensuring that the rights of importers are protected and potentially enhanced by the tariff concessions granted.
Key Provisions
The Customs Act 1901, specifically under Part XVA, establishes a framework for the issuance of Tariff Concession Orders (TCO) by the Chief Executive Officer of Customs (CEO) (sections 269C, 269F, 269P). A TCO application is made under section 269F, and the CEO must determine whether it meets the core criteria set out in section 269C. If satisfied, the CEO must issue a written order (section 269P(3)), such as Tariff Concession Instrument No. 0619743, which in this case relates to certain fired refractory bricks and/or shapes. This instrument was made on 9 March 2007 and declared that these goods are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, with the duty rate set at free, down from the general rate of 5%.
Entities or individuals applying for a TCO must ensure that no substitutable goods are produced in Australia at the time of the application (section 269C). The definitions of "goods produced in Australia," "ordinary course of business," and "substitutable goods" are given in sections 269D, 269E, and 269F respectively. The CEO has the obligation to publish a notice in the Gazette inviting submissions if the application is accepted as valid (subsection 269K(1)). In the case of TCO No. 0619743, no submissions were received.
The obligations imposed by the Customs Act on the CEO include verifying that the application does not pertain to goods specified in section 269SJ, assessing the core criteria, and, if met, issuing a TCO. Additionally, the CEO must ensure that the TCO does not disadvantage any person other than the Commonwealth and does not impose any liabilities on any person (subsection 269S(1)). The TCO is deemed to have come into force on the date of the application lodgement (subsection 269S(1)), which, for TCO No. 0619743, is 12 December 2006. Importers can apply for a refund of duty on goods imported since the effective date of the TCO (paragraph 126(1)(r) of the Regulations).
Breaches of the provisions under the Customs Act may lead to civil or criminal penalties. However, the explanatory statement does not specify the exact nature of these penalties. The consequences for non-compliance can include fines or imprisonment, depending on the severity of the breach and the specific provisions of the Act. The maximum penalties for breaches are not detailed in the explanatory statement, but they would generally be in accordance with the provisions of the Customs Act and associated regulations.