EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0922189
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 zinc coated hot dip steel on 29 June 2009.
Instrument
TCO No 0922189 was made on 18 September 2009. It declares that those certain zinc coated hot dip 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. 0922189 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 Customs Act 1901, enacted by the Australian Parliament, provides the legislative framework for the administration of customs and excise within Australia. One notable component of this Act is the ability for the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) under Part XVA, which aims to address the need for tariff relief for certain imported goods under specific circumstances. This mechanism is designed to ensure that Australian businesses remain competitive by allowing them to access lower-cost imported materials when equivalent local products are not available. Tariff Concession Instrument No. 0922189, made under this legislative framework, demonstrates the application of the Act by providing a tariff concession for certain zinc-coated hot dip steel, reflecting the policy objective of facilitating trade and economic efficiency by reducing customs duties where appropriate.
Scope and Application
The Tariff Concession Instrument No. 0922189 under the Customs Act 1901 applies to the specific goods that Bluescope Steel Pty Ltd applied for, namely certain zinc coated hot dip steel. The Act facilitates the application process for Tariff Concession Orders (TCOs) which are made by the Chief Executive Officer of Customs. The TCO applies to these goods by reducing the duty from the general rate of 5% to free, provided that the CEO is satisfied that no substitutable goods are produced in Australia in the ordinary course of business. The application of the TCO is national in scope, covering all entities and individuals involved in the importation of the specified goods across Australia. The Act's exclusions are limited to goods specified in section 269SJ of the Act, which cannot be subject to a TCO. The commencement of the TCO is effective from the date the application was lodged, in this case, 29 June 2009. The rights of importers are beneficially affected, allowing them to apply for a refund of duty on goods imported since the TCO's effective date. The TCO does not impose any new liabilities on any person and does not affect the rights of any person other than the Commonwealth as at the date of registration.
Key Provisions
The main operative sections of the Customs Act 1901, particularly as they pertain to Tariff Concession Orders (TCOs), include sections 269C, 269B, 269D, 269E, 269F, 269P, and 269S. Section 269F allows for the application of a TCO, which can be made by any person to the Chief Executive Officer of Customs (CEO). The CEO must consider the application against the core criteria set out in section 269C, which requires that on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Definitions for key terms like "goods produced in Australia" (section 269D), "ordinary course of business" (section 269E), and "substitutable goods" (section 269B) are provided in the Act. If the application meets the core criteria, the CEO must make a written order (section 269P(3)) that declares the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies.
The obligations imposed on parties by the Act include the requirement for applicants to ensure that their applications meet the core criteria, particularly that no substitutable goods are produced in Australia. The CEO has the obligation to assess the application, consult as necessary, and make a decision based on the evidence provided. Additionally, the CEO is mandated to publish a notice in the Gazette inviting submissions from interested parties once an application is accepted as valid (subsection 269K(1)). The Act also imposes an obligation on the CEO to consider any submissions received and to make a decision on whether to issue a TCO based on the information and submissions received.
There are no explicit offences, penalties, or consequences detailed within the Act for breaches related to the application or issuance of TCOs. However, any failure to comply with the requirements of the Act or the conditions of a TCO could potentially lead to civil or administrative consequences, such as disputes over duty refunds or challenges to the validity of a TCO. The Act does not specify maximum penalties but implies that breaches could be subject to the general administrative and judicial processes applicable to breaches of the Customs Act 1901 or related regulations.