EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0713616
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.
Intercast & Forge Pty Limited applied for a TCO in respect of certain 58mm high alloy steel bars on 29 August 2007.
Instrument
TCO No 0713616 was made on 09 November 2007. It declares that those certain 58mm high alloy steel bars 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. 0713616 is taken to have come into force on 29 August 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. 0713616 was enacted in 2007 under the Customs Act 1901, addressing the need for tariff concessions for specific imported goods. The Tariff Concession Orders (TCOs) scheme, outlined in Part XVA of the Customs Act, allows the Chief Executive Officer of Customs to grant lower customs duty rates on goods that meet certain criteria. This instrument was introduced to provide a solution for cases where no substitutable goods were produced in Australia, ensuring that the application of tariff concessions does not disadvantage domestic producers. The instrument was made following an application by Intercast & Forge Pty Limited for a TCO on certain 58mm high alloy steel bars, which was accepted as valid by the CEO of Customs. The policy objective of this legislation is to facilitate trade by reducing customs duties on imported goods where no domestic production exists, thereby encouraging imports and potentially lowering costs for businesses that rely on these goods.
Scope and Application
The Customs Act 1901, as amended, facilitates the granting of Tariff Concession Orders (TCOs) through Part XVA, enabling a lower rate of customs duty to be applied to specified goods. This legislative instrument applies to any person or entity that submits an application to the Chief Executive Officer of Customs for a TCO concerning goods, provided that the goods do not fall within the exclusions specified in section 269SJ of the Act. The TCO scheme is operative throughout the Commonwealth of Australia, and its application is not restricted by state or territory boundaries. The Act does not impose any exemptions or thresholds for eligibility to apply for a TCO; however, the application must meet core criteria, such as the absence of substitutable goods produced in Australia, as outlined in sections 269C and 269D of the Act. The scope of the TCO may be further defined or extended through subordinate instruments, which can specify additional conditions or details pertinent to particular goods or applications. The TCO in question, TCO No. 0713616, was made in respect of certain 58mm high alloy steel bars, effectively reducing the duty on these goods from 5% to free, and commenced on the date the application was lodged, 29 August 2007.
Key Provisions
The key provisions of the Tariff Concession Instrument No. 0713616 (referred to as TCO No. 0713616) are primarily contained within the Customs Act 1901 (the Act), specifically under Part XVA. This part of the Act allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). Section 269F of the Act allows for the application of a TCO, while section 269C outlines the core criteria an application must meet. In this case, the CEO must be satisfied that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. This is further defined in sections 269D and 269E, which clarify what constitutes 'goods produced in Australia' and 'ordinary course of business', respectively. If these criteria are met, the CEO is required to make a written order under section 269P(3) of the Act, declaring the goods to which the TCO applies.
The obligations imposed by the Act on the parties involved primarily focus on the application and assessment process. The CEO must ensure that any TCO application submitted meets the core criteria set out in section 269C. This involves verifying that no substitutable goods were produced in Australia on the day the application was lodged. If the CEO is satisfied with the application, they must then proceed to make a written order as per section 269P(3). Additionally, the CEO is mandated to publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not be made, as stipulated in subsection 269K(1) of the Act. Failure to follow these processes could result in the TCO not being properly authorised or challenged.
The Act also includes provisions for penalties and consequences in case of non-compliance. However, the specific offences, penalties, or civil/criminal consequences for breach are not detailed within the TCO No. 0713616 itself. Generally, breaches of the Customs Act 1901 can result in significant penalties, including fines and imprisonment. The maximum penalties can vary depending on the specific breach and the severity of the offence. For example, subsection 244(1) of the Act imposes a penalty of up to 10,000 penalty units for various offences, while subsection 244(2) sets out higher penalties for more serious breaches. It is important to note that the specifics of penalties and consequences would be detailed in other sections of the Customs Act or related legislation, not in the TCO No. 0713616.