EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0903186
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 applied for a TCO in respect of certain ceramic plug refractory mortars on 30 January 2009.
Instrument
TCO No 0903186 was made on 24 April 2009. It declares that those certain ceramic plug refractory mortars 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. 0903186 is taken to have come into force on 30 January 2009.
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 Australian Parliament, includes provisions for Tariff Concession Orders (TCOs) to address the problem of applying reduced customs duties on certain goods that are not produced domestically. This mechanism is designed to encourage the importation of specific goods that are essential for particular industries but not manufactured in Australia, thereby supporting economic growth and competitiveness. The explanatory statement outlines that Tariff Concession Instrument No. 0903186 was introduced to provide tariff concessions on certain ceramic plug refractory mortars, applied for by Bluescope Steel on 30 January 2009. The instrument was enacted on 24 April 2009 by the Chief Executive Officer of Customs, who determined that no substitutable goods were produced in Australia, thus meeting the core criteria for a TCO. This decision aligns with the policy objective of facilitating the importation of goods that are crucial for industry needs while ensuring no domestic producers are disadvantaged.
Scope and Application
The Customs Act 1901 applies to individuals and entities involved in the importation of goods into Australia, particularly those seeking tariff concessions on specific goods. The Act facilitates the process whereby an applicant can apply for a Tariff Concession Order (TCO) from the Chief Executive Officer of Customs. This instrument allows for a lower rate of customs duty on goods that meet certain criteria, as outlined in section 269C of the Act. The TCO mechanism is designed to ensure that no substitutable goods are produced in Australia, thereby justifying the tariff concession. The Act's application is primarily concerned with the importation of goods, and the concessions granted by a TCO are limited to the goods specified in the order. The instrument extends across the Commonwealth of Australia, affecting all states and territories equally, as it pertains to the overarching customs duties managed by the federal government. There are specific exclusions outlined in section 269SJ of the Act, detailing the types of goods that cannot be subject to a TCO. The scope of the Act may be further defined or expanded through subordinate instruments, which can provide additional regulations or specifications regarding the application and enforcement of TCOs.
Key Provisions
The Tariff Concession Instrument No. 0903186, issued under the Customs Act 1901, establishes a concession on customs duties for certain ceramic plug refractory mortars. Section 269F of the Act allows for an application to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO), which applies a lower rate of customs duty to the specified goods. Section 269C mandates that the CEO must consider whether the application meets the core criteria, which include ensuring no substitutable goods were produced in Australia on the day the application was lodged (section 269P(3)). Definitions for key terms such as "substitutable goods," "produced in Australia," and "ordinary course of business" are provided in sections 269D, 269E, and 269B, respectively.
Under this Act, the CEO has specific obligations to consider applications for TCOs and determine whether they meet the stipulated criteria. If the CEO is satisfied that the application meets these criteria, they must issue a written TCO (subsection 269P(3)). Additionally, section 269K(1) requires the CEO to publish a notice in the Gazette inviting submissions from any interested parties regarding the proposed TCO. This notice must be published as soon as practicable after the application is deemed valid. The CEO must also consider any submissions received before making a final decision on the TCO.
Failure to comply with the requirements of the Customs Act 1901 can result in significant consequences. While the specific section of the Act detailing offences and penalties is not mentioned in the provided text, it is known that breaches of the Customs Act can lead to both civil and criminal penalties. Typically, these can include fines and imprisonment, depending on the severity of the offence. The maximum penalties are not specified in the text, but they are generally outlined in the relevant sections of the Act. It is important for all parties governed by this legislation to adhere strictly to its provisions to avoid such consequences.
For the case of TCO No. 0903186, the CEO found that the application by Bluescope Steel met the core criteria, resulting in a TCO that was published on 24 April 2009. This order reduced the duty rate on the specified ceramic plug refractory mortars from the general rate of 5% to free. The TCO came into effect on the date the application was lodged, 30 January 2009, without affecting any pre-existing rights or imposing new liabilities on any parties, except for potential benefits to importers who can now apply for duty refunds on goods imported since the TCO's effective date (subsection 269S(1)).