EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0705000
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 isolation gate valves on 29 March 2007.
Instrument
TCO No 0705000 was made on 15 June 2007. It declares that those certain isolation gate 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 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. 0705000 is taken to have come into force on 29 March 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 Tariff Concession Instrument No. 0705000 was enacted in 2007 under the Customs Act 1901 to provide tariff concessions for specific goods, thereby addressing the issue of high customs duties on certain imported items. This instrument was introduced to facilitate easier and more affordable access to particular goods by reducing their customs duty rates. The Customs Act 1901 provides a framework for the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) if certain criteria are met. In this instance, the CEO determined that no substitutable goods were produced in Australia for the isolation gate valves in question, allowing for the application of a lower duty rate. This legislative action was aimed at enhancing economic efficiency by reducing the cost of importing these goods, thereby supporting industries that rely on such materials.
The Australian Parliament enacted this legislation to streamline the process for applying lower customs duties on specific goods, aligning with the policy objective of facilitating trade and supporting domestic industries. The Tariff Concession Instrument No. 0705000 effectively reduces the duty on certain isolation gate valves from 5% to 0%, making these goods more accessible and affordable. The implementation of this instrument ensures that the rights of importers are protected, and it does not impose any new liabilities on individuals or entities.
Scope and Application
The Tariff Concession Instrument No. 0705000, made under the Customs Act 1901, pertains specifically to the application of Tariff Concession Orders (TCO) for certain isolation gate valves. This legislation applies to Bluescope Steel Ltd, or any entity or individual seeking to import these specific goods, by reducing the customs duty from the general rate of 5% to 0%. The application of this TCO is confined to the goods specified in the instrument and is in effect from the date the application was lodged, 29 March 2007. The geographic reach of this Act is national, as it applies throughout Australia under the Commonwealth’s legislative authority. The Act excludes any goods specified in section 269SJ of the Customs Act 1901, which lists goods that cannot be subject to a TCO. Additionally, the Act does not disadvantage any person by affecting their rights as at the date of registration nor impose liabilities for actions taken prior to the registration date, although it does benefit importers by potentially allowing them to apply for a refund of duty under the Customs Act Regulations. The application of the Act can be extended or restricted through subordinate instruments, which are not detailed in the provided text.
Key Provisions
The primary operative sections of the Customs Act 1901, as they relate to Tariff Concession Orders (TCOs), are sections 269C, 269F, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO concerning goods. If the application meets the core criteria outlined in section 269C, the CEO must make a written order (the TCO), specifying the lower rate of customs duty applicable to the goods in question. This is further defined by section 269P, which mandates the CEO to issue a TCO if satisfied that no substitutable goods are produced in Australia in the ordinary course of business. The TCO will apply the prescribed tariff item from Schedule 4 of the Customs Tariff Act 1995 to the specified goods.
Under this legislation, the CEO has specific obligations when processing a TCO application. Upon receiving an application under section 269F, the CEO must first determine whether the goods specified in the application are excluded under section 269SJ, which lists goods that cannot be subject to a TCO. If the goods are not excluded, the CEO must then assess whether the application meets the core criteria stipulated in section 269C. This involves verifying that no substitutable goods are produced in Australia in the ordinary course of business, as defined by sections 269D and 269E. If the application is found to meet these criteria, the CEO must make a written TCO as per section 269P(3) and publish a notice in the Gazette inviting any objections or submissions from the public. In the case of TCO No. 0705000, no objections were received.
The Act outlines specific consequences for non-compliance with the requirements of a TCO. While the explanatory statement does not detail specific offences or penalties for breaching the TCO, breaches of related customs regulations could potentially lead to penalties. Such penalties could include fines, imprisonment, or both, depending on the severity and intent behind the breach. The specifics of these penalties would be governed by the broader Customs Act 1901 and any associated regulations, but they are not explicitly addressed in the explanatory statement for TCO No. 0705000. Importers, however, may benefit from the TCO by applying for a refund of duty on goods imported since the TCO came into force, as per paragraph 126(1)(r) of the Regulations.