EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0816281
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.
Okaya Australia Pty Ltd applied for a TCO in respect of certain aluminium coated steel sheet and or strip on 07 July 2008.
Instrument
TCO No 0816281 was made on 26 September 2008. It declares that those certain aluminium coated steel sheet and or strip 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. 0816281 is taken to have come into force on 07 July 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 Customs Act 1901, enacted by the Parliament of Australia, includes a provision for Tariff Concession Orders (TCOs) under Part XVA. This scheme was introduced to provide relief to industries by allowing for lower rates of customs duty on goods that meet specific criteria, thereby addressing economic disadvantages faced by Australian producers and industries when competing with imported goods. The explanatory statement for Tariff Concession Instrument No. 0816281, made on 26 September 2008, outlines the application process and the decision-making criteria set out in the Act. In this instance, Okaya Australia Pty Ltd successfully applied for a TCO concerning certain aluminium coated steel sheet and strip, resulting in a reduction of the duty rate from 5% to free. The instrument ensures that no person is disadvantaged by the concessions, and importers can apply for duty refunds for goods imported since the effective date of the TCO.
Scope and Application
The Tariff Concession Instrument No. 0816281, made under the Customs Act 1901, applies to specific goods—in this case, certain aluminium coated steel sheet and or strip—for which Okaya Australia Pty Ltd applied for tariff concessions. This Act is applicable nationally across Australia and pertains to the process through which the Chief Executive Officer of Customs can make Tariff Concession Orders that alter the customs duty rates on particular imported goods. This legislative instrument extends to the Commonwealth jurisdiction, affecting the imposition and collection of customs duties on specified goods. The instrument does not impose any liabilities on any person and does not disadvantage any person except the Commonwealth. The exemption from customs duties applies only to the goods specified in the order and not to other goods. The Act allows for the creation of subordinate instruments that can further define or extend the application of tariff concession orders, although no such instruments are mentioned in this context. The TCO came into force on the date the application was lodged, which was 7 July 2008, and provides a benefit to importers by allowing them to apply for a refund of duty on goods imported from this effective date.
Key Provisions
The Tariff Concession Instrument No. 0816281 pertains to the Customs Act 1901 and specifies provisions for Tariff Concession Orders (TCOs). Under section 269F, an application for a TCO can be made by any person, and if the Chief Executive Officer (CEO) of Customs is satisfied that the application pertains to goods not excluded by section 269SJ, they must assess whether it meets the core criteria stipulated in section 269C. A TCO application meets these criteria if, on the day of submission, no substitutable goods were produced in Australia in the ordinary course of business, as defined by sections 269D and 269E. In this specific instance, Okaya Australia Pty Ltd applied for a TCO concerning certain aluminium coated steel sheet and strip on 07 July 2008. The CEO was satisfied that no substitutable goods were produced in Australia, leading to the issuance of TCO No. 0816281 on 26 September 2008, which reduced the duty rate for these goods to zero, down from the general rate of 5%.
The obligations under this Act require the CEO to publish a notice in the Gazette inviting submissions if a TCO application is deemed valid, as per section 269K(1). In this case, the CEO did not receive any submissions opposing the TCO. Furthermore, under section 269S(1), the TCO is considered to have come into force on the date the application was lodged, which for TCO No. 0816281 was 07 July 2008. Importantly, the TCO does not affect any pre-existing rights or impose any liabilities on persons other than the Commonwealth, as per the provisions of the Act.
In terms of consequences for breach, the Act does not explicitly detail specific offences, penalties, or civil/criminal consequences for non-compliance with the TCO provisions. However, it is essential to note that failure to adhere to the terms of the TCO could potentially lead to disputes or legal actions regarding the tariff rates and any subsequent duty refunds. Importers may also face administrative challenges if they do not correctly apply for duty refunds as permitted under paragraph 126(1)(r) of the Regulations.