EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0922171
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 Pty Ltd applied for a TCO in respect of certain hot rolled steel on 29 June 2009.
Instrument
TCO No 0922171 was made on 18 September 2009. It declares that those certain hot rolled steel 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. 0922171 is taken to have come into force on 29 June 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. 0922171, enacted in 2009, is a legislative measure under the Customs Act 1901 designed to address the issue of customs duty on specific imported goods. The instrument was introduced to provide tariff concessions for certain hot rolled steel products, as applied for by Bluescope Steel Pty Ltd. The problem it aimed to resolve was the imposition of customs duties on these goods, which could potentially hinder their affordability and accessibility in the Australian market. The Tariff Concession Order (TCO) was made by the Chief Executive Officer of Customs (CEO) pursuant to section 269F of the Act, ensuring that the application met the core criteria, specifically that no substitutable goods were produced in Australia at the time of the application. The CEO was satisfied with the application, leading to the issuance of the TCO, which provides a duty-free rate for the specified hot rolled steel products, thereby alleviating the financial burden on importers and consumers.
Scope and Application
The Tariff Concession Instrument No. 0922171, under the Customs Act 1901, applies to entities seeking tariff concessions for specific goods entering Australia. The Act facilitates tariff concessions for goods not produced in Australia, thereby lowering the customs duty rate for those goods. This legislation is applicable nationwide as it falls under the Commonwealth's jurisdiction. The instrument specifically addresses the application of Bluescope Steel Pty Ltd for tariff concessions on certain hot rolled steel, reducing the duty rate from 5% to free. The application process involves the Chief Executive Officer of Customs assessing whether no substitutable goods are produced in Australia and whether the core criteria are met, as outlined in sections 269C and 269SJ of the Act. The instrument exempts any pre-existing rights or liabilities incurred before its effective date, which is the date the application was lodged, 29 June 2009, thus ensuring no adverse impact on existing transactions. This legislative instrument extends its application through the subordinate Customs Tariff Act 1995, which specifies the duty rates and items subject to concession.
Key Provisions
The primary sections of Tariff Concession Instrument No. 0922171, under the Customs Act 1901, focus on establishing the conditions and process for issuing a Tariff Concession Order (TCO) for specific goods. Section 269F allows an individual to apply to the Chief Executive Officer of Customs (CEO) for a TCO. If the CEO is satisfied that the application does not involve goods specified in section 269SJ, which are ineligible for a TCO, the CEO must evaluate whether the application meets the core criteria. Section 269C stipulates that a TCO application meets these criteria if, on the date of application, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B further defines the key terms used in the determination of these criteria.
The obligations imposed by the Act on the parties include ensuring that the application for a TCO is properly lodged and that it pertains to goods that meet the core criteria. The CEO is mandated to publish a notice in the Gazette, inviting any interested parties to submit reasons why the TCO should not be granted. If no submissions are received, the CEO is required to make the TCO as specified in the application, provided it meets the core criteria. In this instance, Bluescope Steel Pty Ltd applied for a TCO for certain hot rolled steel, and the CEO was satisfied that no substitutable goods were produced in Australia, thus meeting the criteria for a concession.
In terms of offences, penalties, or consequences for breaches, the Act does not explicitly outline specific penalties for failing to comply with the TCO process. However, any non-compliance with the Customs Act 1901, including the provisions related to TCOs, could potentially lead to legal actions. The general rate of duty on the goods subject to the TCO is reduced to free, as declared in the instrument, but no specific penalties are mentioned for breaches related to this concession. The TCO does not affect the rights of any person as at the date of registration, nor does it impose any liabilities on any person for actions taken before the registration date.