EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0905485
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 resin bonded ramming mixtures on 17 February 2009.
Instrument
TCO No 0905485 was made on 15 May 2009. It declares that those certain resin bonded ramming mixtures 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. 0905485 is taken to have come into force on 17 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 Tariff Concession Instrument No. 0905485 was enacted in 2009 under the Customs Act 1901 to address the need for concessional tariffs for specific imported goods. This instrument was introduced to facilitate the application of tariff concessions for certain resin bonded ramming mixtures, a product for which Bluescope Steel had applied. The Customs Act 1901 provides the framework for Tariff Concession Orders (TCOs), allowing the Chief Executive Officer of Customs to grant tariff concessions on goods not produced in Australia. The objective of this legislation is to ensure that such concessions are granted when it is confirmed that there are no substitutable goods produced domestically, thereby benefiting the rights of importers who can now claim refunds for duties paid on these goods. This instrument was enacted by the Parliament of Australia and aligns with the policy objective of providing economic relief and encouraging the importation of specific goods that are not locally produced.
Scope and Application
The Customs Act 1901, through its Part XVA, provides a framework for the creation of Tariff Concession Orders (TCOs) which can reduce the customs duty on specified goods. These orders are made by the Chief Executive Officer of Customs (the CEO) upon application and must meet certain criteria to be approved. Specifically, the Act requires that no substitutable goods are produced in Australia at the time of the application, ensuring that the concession is granted in the absence of local production that could substitute for the imported goods. This process is applicable to any person who can demonstrate that the goods they wish to import are not produced domestically in a substitutable form. The geographic scope of the Act is national, applying across Australia, and it does not distinguish between states, territories, or industries but focuses on the production and importation of specific goods. There are exclusions in the Act, notably that certain goods, as specified in section 269SJ, are not eligible for a TCO. The application of the Act can be extended or modified through subordinate instruments, which may specify additional criteria or processes for the application and review of TCOs. The Tariff Concession Instrument No. 0905485, for instance, was created to provide a tariff concession for certain resin bonded ramming mixtures, effectively reducing the duty on these goods from 5% to free, provided no local substitutes were being produced.
Key Provisions
The key operative sections of Tariff Concession Instrument No. 0905485 are found in the Customs Act 1901, specifically within Part XVA which outlines the process for Tariff Concession Orders (TCOs). Section 269F (1) allows for an application to be made to the Chief Executive Officer of Customs (CEO) for a TCO in respect of certain goods. Section 269C (1) provides that an application meets the core criteria if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged, as defined in sections 269D and 269E respectively. If the CEO is satisfied that the application meets these core criteria, they must make a written order, a TCO, declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (Tariff), as stipulated in subsection 269P(3). In this specific case, TCO No. 0905485 was issued on 15 May 2009, declaring that certain resin bonded ramming mixtures are subject to a zero rate of duty.
The Act imposes several obligations on the parties involved in the TCO process. Firstly, any person seeking a TCO must apply to the CEO as per section 269F, ensuring the application does not pertain to goods specified in section 269SJ, which are ineligible for a TCO. The CEO must then determine whether the application meets the core criteria outlined in section 269C, considering whether substitutable goods were produced in Australia. If the CEO is satisfied, they must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made, in accordance with section 269K(1). The CEO in this instance did not receive any submissions. Upon satisfying the core criteria, the CEO must make a TCO as per section 269P(3), which in this case was issued on 15 May 2009.
There are no specific offences, penalties, or civil/criminal consequences detailed in the explanatory statement for breach of the provisions of the Customs Act 1901 or the Tariff Concession Instrument No. 0905485. However, the Act does provide that the TCO does not affect the rights of a person (other than the Commonwealth) as at the date of registration to disadvantage that person or impose liabilities in respect of anything done or omitted to be done before the date of registration. This ensures that the TCO does not retroactively impose any liabilities on any person and does not disadvantage anyone’s rights existing prior to the registration of the TCO.