EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0701480
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 material charging blast furnace valves on 24 January 2007.
Instrument
TCO No 0701480 was made on 20 April 2007. It declares that those certain material charging blast furnace valves 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. 0701480 is taken to have come into force on 24 January 2007.
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 amended to introduce a scheme for Tariff Concession Orders (TCOs) to provide relief on customs duty for certain goods, addressing a gap in the legislative framework regarding the potential for tariff concessions. Enacted by the Parliament of Australia, this initiative aims to facilitate trade by reducing the customs duty burden on specific goods, thereby encouraging importation and supporting industries that rely on these goods. This instrument, specifically Tariff Concession Instrument No. 0701480, was introduced to provide a lower rate of customs duty on certain material charging blast furnace valves, benefiting importers by eliminating duty on these goods. The Chief Executive Officer of Customs is responsible for deciding whether an application for a TCO meets the core criteria, which include the absence of substitutable goods produced in Australia. This legislative measure ensures that the rights of importers are positively impacted and that no liabilities are imposed on individuals or entities as a result of the TCO.
Scope and Application
The Tariff Concession Instrument No. 0701480 under the Customs Act 1901 applies to entities or individuals seeking tariff concessions for specific goods imported into Australia, specifically Bluescope Steel Limited’s application for material charging blast furnace valves. This Act governs the process by which the Chief Executive Officer of Customs can grant a Tariff Concession Order (TCO), allowing for a lower rate of customs duty on goods specified in the TCO. The application of this legislation is national, affecting all entities engaged in the importation of the specified goods within Australia. The Act ensures that no substitutable goods are produced in Australia in the ordinary course of business for the goods in question, which was the case for the material charging blast furnace valves, leading to the approval of the TCO and the imposition of a zero duty rate. The TCO does not disadvantage any person except the Commonwealth and does not impose any liabilities on persons other than the Commonwealth, ensuring that the rights of importers are beneficially affected. The commencement of the TCO aligns with the date the application was lodged, thereby protecting the rights of individuals and entities as at the date of registration.
Key Provisions
The main operative sections of this legislation focus on the process and requirements for making Tariff Concession Orders (TCOs) under Part XVA of the Customs Act 1901 (the Act). Specifically, Section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a TCO in respect of goods. Section 269C stipulates that an application meets the core criteria if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. If the CEO is satisfied that the application meets the core criteria, they must make a written order (the TCO) (Section 269P(3)).
The Act imposes several obligations and requirements on the parties involved. Firstly, the CEO must decide whether an application meets the core criteria, which includes ensuring that no substitutable goods were produced in Australia in the ordinary course of business. This determination is crucial before a TCO can be issued. Furthermore, the CEO is required to publish a notice in the Gazette as soon as practicable after accepting a TCO application as a valid application, inviting any person who considers there are reasons why the TCO should not be made to lodge a submission (Section 269K(1)).
Any breaches of the provisions outlined in the Customs Act 1901 may lead to civil or criminal consequences. However, the explanatory statement does not provide specific details on offences, penalties, or maximum penalties for breaches. The general implication is that failing to comply with the Act’s requirements, such as not properly adhering to the TCO application process, could result in legal repercussions. Although the specific penalties are not detailed in the explanatory statement, such breaches could potentially lead to fines or other legal actions as per the broader provisions of the Customs Act 1901 and associated regulations.