EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0800433
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 Pty Ltd applied for a TCO in respect of certain coke crusher gate actuators on 08 January 2008.
Instrument
TCO No 0800433 was made on 25 March 2008. It declares that those certain coke crusher gate actuators 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. 0800433 is taken to have come into force on 08 January 2008.
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. 0800433, enacted in 2008 under the Customs Act 1901, was introduced to address the need for tariff concessions on specific imported goods where no substitutable domestic products exist. The instrument facilitates the application process for tariff concession orders (TCOs) by allowing the Chief Executive Officer of Customs to approve applications for goods that meet the core criteria, ensuring that no substitutable goods are produced in Australia in the ordinary course of business. This legislative measure aims to provide relief to importers by reducing the customs duty on certain goods, thereby encouraging trade and benefiting the importing sector without disadvantaging other stakeholders. The Australian Parliament enacted this instrument to streamline the tariff concession process, ensuring that the rights of all parties are protected while facilitating smoother trade operations.
Scope and Application
The Tariff Concession Instrument No. 0800433 under the Customs Act 1901 applies to the specific goods, namely certain coke crusher gate actuators, for which Bluescope Steel Pty Ltd applied for a tariff concession. The Act facilitates the application process for tariff concessions through the Chief Executive Officer of Customs, who assesses whether the goods can qualify for a lower customs duty rate. This concession is contingent upon the goods not having substitutable products produced within Australia. The instrument extends its application to the Commonwealth and does not affect the rights of any persons or impose liabilities on them for actions taken prior to the instrument's registration. Importantly, this instrument does not apply to goods specified in section 269SJ of the Customs Act 1901, which are ineligible for tariff concessions. The scope of this instrument is further refined through subordinate instruments, which provide detailed definitions and criteria necessary for the application and enforcement of tariff concessions.
Key Provisions
The Customs Act 1901 provides a framework for Tariff Concession Orders (TCOs) through Part XVA, which allows the Chief Executive Officer of Customs (CEO) to grant reduced customs duty rates on specific goods (s 269F). Section 269C stipulates that for an application to be considered, there must be no substitutable goods produced in Australia at the time of application (s 269C). Substitutable goods, as defined by s 269D and s 269E, are those produced domestically that can serve the same purpose as the goods in question. Section 269SJ lists goods that cannot be subject to a TCO. If the CEO is satisfied that the application meets these core criteria, a TCO must be issued (s 269P(3)), as seen in the case of Bluescope Steel Pty Ltd's application for coke crusher gate actuators (TCO No. 0800433).
The CEO is mandated to publish a notice in the Gazette inviting submissions on the TCO application (s 269K(1)), although no submissions were received for TCO No. 0800433. This TCO came into force on the date of application, 08 January 2008, as per s 269S(1). Importantly, the TCO does not retroactively disadvantage any person or impose new liabilities on them, safeguarding existing rights (s 269S(1)). Importers can apply for duty refunds for goods imported since the TCO's effective date under Regulation 126(1)(r).
The Act imposes several obligations on the CEO, including verifying that no substitutable goods are produced in Australia at the time of application, making a written TCO if criteria are met, and publishing notices in the Gazette to allow for public submissions. Importers and other relevant parties must ensure they comply with the TCO and related regulations, such as applying for duty refunds where applicable. Non-compliance with the Act or Regulations could result in civil or criminal penalties, although specific penalties are not outlined in this explanatory statement.