EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0833616
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 parallel or check steam valves parts on 01 October 2008.
Instrument
TCO No 0833616 was made on 19 December 2008. It declares that those certain parallel or check steam valves parts 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. 0833616 is taken to have come into force on 01 October 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. 0833616, enacted in 2008 under the Customs Act 1901, addresses the need for tariff concessions for specific imported goods. This legislative instrument was introduced to facilitate tariff reductions on certain goods, as requested by Bluescope Steel Limited, to ensure that these goods are competitively priced and accessible within the Australian market. The instrument was developed by the Chief Executive Officer of Customs, following a process that included a public consultation period where no objections were received. The Tariff Concession Order (TCO) applies to certain parallel or check steam valves parts, reducing the duty from the general rate of 5% to free, thereby enhancing the affordability and availability of these goods in Australia.
The enactment of the Tariff Concession Instrument No. 0833616 by the Parliament of Australia under the Customs Act 1901 aims to streamline the process of granting tariff concessions, ensuring that the application of such concessions does not disadvantage any person and does not impose new liabilities. The instrument provides a clear framework for importers to benefit from reduced tariffs, aligning with the policy objective of fostering competitive markets and facilitating the efficient flow of trade within Australia.
Scope and Application
The Customs Act 1901, as amended, includes provisions for the establishment of Tariff Concession Orders (TCOs) under Part XVA, which provide for a lower rate of customs duty on certain goods. The Act applies to entities such as Bluescope Steel Limited, which can apply for a TCO on specific goods if no substitutable goods are produced in Australia in the ordinary course of business. The CEO of Customs has the authority to make a TCO if the application meets the core criteria outlined in the Act, such as the absence of substitutable goods produced domestically. The geographic scope of this legislation is national, as it pertains to the customs duties and tariffs managed by the Commonwealth of Australia. The TCOs do not disadvantage any person and do not impose liabilities, but rather provide a benefit to importers who may apply for a refund of duty on goods imported since the effective date of the TCO. This legislation can be further detailed and extended through subordinate instruments, which may specify additional criteria or procedures for TCO applications.
Key Provisions
The Tariff Concession Instrument No. 0833616 applies the Customs Act 1901 (the Act) and sets out a scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (the CEO) (section 269F). The application for a TCO by Bluescope Steel Limited in respect of certain parallel or check steam valves parts was made on 1 October 2008, and the instrument was declared on 19 December 2008. The CEO was satisfied that the application met the core criteria (section 269C), and the instrument declares that the goods in question are subject to a free rate of duty, as opposed to the general rate of 5% (subsection 269P(3)). The TCO came into force on the date the application was lodged (subsection 269S(1)) and does not affect the rights of any person (subsection 269S(2)) except to the benefit of importers who may apply for a refund of duty (Regulations, paragraph 126(1)(r)).
The Act imposes certain obligations on the CEO when considering an application for a TCO. Under section 269K(1), the CEO must publish a notice in the Gazette inviting any person who believes the TCO should not be made to lodge a submission. In this case, the CEO did not receive any submissions in response to the notice. Furthermore, the CEO must ensure that the application meets the core criteria as set out in section 269C, which requires that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged.
Under the Customs Act 1901, the CEO has the power to impose penalties for breaches of the Act or its regulations. However, the Explanatory Statement does not specify any offences, penalties, or civil/criminal consequences for breach of the Tariff Concession Instrument No. 0833616. It is likely that penalties would be determined by the applicable laws and regulations governing customs duties and tariff concession orders.
In summary, the Tariff Concession Instrument No. 0833616 applies the Customs Act 1901 and sets out a scheme for making TCOs. The CEO must consider applications for TCOs and ensure that they meet the core criteria. The CEO must also publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made. The TCO came into force on the date the application was lodged and does not affect the rights of any person except to the benefit of importers who may apply for a refund of duty. Penalties for breach of the Act or its regulations are not specified in the Explanatory Statement.