EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0908209
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 insulating mixtures on 11 March 2009.
Instrument
TCO No 0908209 was made on 29 May 2009. It declares that those certain insulating 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. 0908209 is taken to have come into force on 11 March 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. 0908209 was introduced under the Customs Act 1901 to address the issue of applying for tariff concessions on certain goods, specifically insulating mixtures, which were not being produced domestically. The Customs Act 1901 provides for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, allowing for a lower rate of customs duty on goods that meet specific criteria. In this case, Bluescope Steel applied for a TCO for certain insulating mixtures, which the CEO approved on 29 May 2009, declaring that these goods would be subject to a duty rate of free, as no substitutable goods were being produced in Australia. This legislative instrument aims to ensure that Australian importers of such goods can benefit from the tariff concession, effective from the date the application was lodged, 11 March 2009, without any retroactive disadvantage or new liabilities imposed on individuals or entities.
Scope and Application
The Tariff Concession Instrument No. 0908209 under the Customs Act 1901 applies to individuals or entities seeking tariff concessions on specific goods imported into Australia. This instrument was formulated in response to an application by Bluescope Steel for a Tariff Concession Order (TCO) concerning certain insulating mixtures. The legislation ensures that the application process is governed by stringent criteria, primarily whether substitutable goods are produced in Australia, and mandates that if no such goods are found, the CEO of Customs must proceed with the TCO. The geographical scope of this legislation is national, as it pertains to the customs duties and tariff concessions applicable across Australia. The instrument does not disadvantage any person or impose liabilities on individuals or entities other than the Commonwealth, thereby ensuring that the rights of importers are preserved and potentially enhanced through the refund of duties under specific regulations. Subordinate instruments may further extend or clarify the application of this legislation, ensuring its comprehensive implementation and enforcement.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0908209 concern the establishment and application of Tariff Concession Orders (TCOs) under the Customs Act 1901 (section 269C, 269B, and 269F). The instrument specifies that the CEO of Customs must make a TCO if they are satisfied that the application for the concession meets the core criteria, namely, if no substitutable goods were produced in Australia on the day the application was lodged (section 269P(3)). The CEO must also ensure that the goods in question are not those that cannot be subject to a TCO under section 269SJ of the Act. Once the TCO is made, it declares that certain goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, in this case, item 50 for certain insulating mixtures, with the duty rate for these goods set at free, down from the general rate of 5% (section 269P(3)).
Entities or individuals applying for a TCO must ensure their applications meet the core criteria, specifically that no substitutable goods were produced in Australia on the application date. The CEO is obligated to review applications to verify compliance with these criteria and to make a written order if satisfied. Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to submit objections to the TCO, although in this case, no submissions were received (subsection 269K(1)). The TCO itself is effective from the date the application was lodged, which in this instance was 11 March 2009 (subsection 269S(1)).
Any breaches of the conditions under which a TCO is granted may result in significant consequences. If the CEO determines that substitutable goods were produced in Australia at the time of the application, the TCO may be revoked, and the affected parties could be subject to the original duty rates. Additionally, any misrepresentations or false information provided during the application process could lead to further penalties or legal actions. However, specific penalties for such breaches are not detailed in the provided text, and would typically be found within the broader framework of the Customs Act 1901 and associated regulations.
Overall, the obligations under the Customs Act 1901 and the accompanying Tariff Concession Instrument No. 0908209 ensure that the process for granting tariff concessions is transparent, fair, and subject to rigorous scrutiny to maintain the integrity of the customs duty system.