EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0905028
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.
Wilson Transformer applied for a TCO in respect of certain silicon electrical steel sheet on 13 February 2009.
Instrument
TCO No 0905028 was made on 08 May 2009. It declares that those certain silicon electrical steel sheet 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. 0905028 is taken to have come into force on 13 February 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, provides a framework for the administration of customs and excise in Australia. This Act was designed to facilitate international trade by establishing a streamlined process for the application and assessment of Tariff Concession Orders (TCOs). These orders, which are issued by the Chief Executive Officer of Customs, aim to provide tariff relief on specific goods by reducing the rate of customs duty. The purpose of Tariff Concession Instrument No. 0905028, introduced in 2009, is to grant tariff concessions to Wilson Transformer for certain silicon electrical steel sheet, effectively setting the duty rate for these goods at free, as no substitutable goods were produced in Australia at the time of application. This legislative measure ensures that the application process is transparent and allows for public consultation, thereby upholding the policy objective of fair and efficient customs administration.
Scope and Application
The Tariff Concession Instrument No. 0905028 applies to the concession of customs duty for certain silicon electrical steel sheets, as specified by the Customs Act 1901, and is relevant to the Chief Executive Officer of Customs who must make a decision based on the core criteria outlined in the Act. This Act applies to entities or individuals who seek tariff concessions for goods imported into Australia, provided that the goods are not specified as ineligible under section 269SJ of the Act. The instrument extends its application to the goods specified in the application by Wilson Transformer, which were considered by the CEO to meet the core criteria for concession. The geographic reach of this legislation is national, impacting the entire Commonwealth of Australia, as it pertains to the customs duty applied on imported goods. Any exclusions or exemptions are determined by the specific provisions of the Customs Act 1901, which the CEO references when considering applications for tariff concessions. Additionally, the application of the Act can be further defined or restricted through subordinate instruments, such as regulations, which provide further detail on the process and criteria for tariff concession applications.
Key Provisions
The main operative sections of this legislation are sections 269C, 269F, 269P, and 269SJ of the Customs Act 1901. Section 269F allows an individual or entity to apply to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO). If the application meets the core criteria specified in section 269C, and the CEO is satisfied that no substitutable goods were produced in Australia in the ordinary course of business, the CEO is required under section 269P to make a written order, the TCO, which declares that the goods subject to the application are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. It is pertinent to note that section 269SJ specifies certain goods that cannot be subject to a TCO.
The Act imposes several obligations on the parties it governs. Firstly, applicants for a TCO must ensure their application meets the core criteria as defined in section 269C of the Act. They must demonstrate that no substitutable goods were produced in Australia in the ordinary course of business on the date the application was lodged. The CEO of Customs, on receiving a valid application, must make a TCO if the application meets the core criteria. The CEO is also required to publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting submissions from any person who believes there are reasons why the TCO should not be made, as per subsection 269K(1). In this instance, the CEO did not receive any submissions in response to the published notice.
Failure to comply with the requirements of the Customs Act 1901 and the associated regulations may result in civil or criminal consequences. The Act does not specify particular offences or penalties for breaches of the TCO provisions. However, general provisions within the Customs Act 1901 allow for the imposition of penalties for breaches, including fines and imprisonment. The exact penalties depend on the nature and severity of the breach, and would be determined by a court in the event of a prosecution. It is important for all parties involved to ensure strict adherence to the Act's provisions to avoid any potential legal repercussions.