EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0926241
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 hot rolled steel in coils on 22 July 2009.
Instrument
TCO No 0926241 was made on 02 October 2009. It declares that those certain hot rolled steel in coils 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. 0926241 is taken to have come into force on 22 July 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, establishes a framework within which Tariff Concession Orders (TCOs) may be issued by the Chief Executive Officer of Customs. These orders facilitate tariff concessions for specified goods, reducing customs duty rates for those subject to a TCO. The 2010 Tariff Concession Instrument No. 0926241, published under this Act, aimed to address the need for tariff relief on certain hot rolled steel in coils, as applied for by Bluescope Steel on 22 July 2009. Following an assessment by the CEO, who found that no substitutable goods were produced in Australia, Tariff Concession Order No. 0926241 was issued on 2 October 2009, making the specified steel products duty-free. The order was designed to benefit importers by potentially allowing them to claim refunds for duties paid on these goods since the effective date of the TCO, 22 July 2009, without imposing any new liabilities.
Scope and Application
The Customs Act 1901, specifically under Part XVA, outlines the framework for Tariff Concession Orders (TCOs) which provide lower rates of customs duty on certain goods. The Act applies to any person or entity seeking a tariff concession for goods not produced in Australia in the ordinary course of business, as outlined in section 269C. The Chief Executive Officer of Customs (CEO) is responsible for determining whether an application for a TCO meets the core criteria and subsequently making a written order. The TCO scheme is applicable across the Commonwealth of Australia, affecting all relevant industries that import the specified goods. Notably, goods specified in section 269SJ of the Act, which are ineligible for a TCO, are excluded from this scheme. The application of the TCO is also subject to consultation and publication processes, as mandated by section 269K(1) of the Act. This legislative instrument, TCO No. 0926241, made on 2 October 2009, applies to certain hot rolled steel in coils, reducing the duty rate from 5% to free, and came into force on the date of application, 22 July 2009, without imposing liabilities or affecting pre-existing rights of any person other than the Commonwealth.
Key Provisions
The main operative sections of this legislation (Tariff Concession Instrument No. 0926241) include section 269C, which outlines the core criteria for determining whether a Tariff Concession Order (TCO) application meets the necessary requirements (s 269C). If the Chief Executive Officer (CEO) of Customs is satisfied that the application meets these criteria, they must make a written order declaring the goods to which the TCO applies (s 269P(3)). Section 269K(1) requires the CEO to publish a notice in the Gazette after accepting a TCO application as valid, inviting submissions from any person who believes there are reasons why the TCO should not be made (s 269K(1)). Finally, section 269S(1) states that a TCO comes into force on the day the application for the TCO was lodged (s 269S(1)).
The obligations imposed on parties by this legislation include the requirement for the CEO to decide whether a TCO application meets the core criteria, which are specified in section 269C. The CEO must also publish a notice in the Gazette to invite submissions on the application, as stipulated in section 269K(1). Importers of the goods affected by the TCO may apply for a refund of duty on goods imported since the TCO's effective date, under paragraph 126(1)(r) of the Regulations.
Failure to comply with the provisions of this legislation may result in various consequences. While the explanatory statement does not specify offences, penalties, or civil/criminal consequences for breach, it is implied that any non-compliance could lead to legal action. The maximum penalties, if any, would depend on the specific breach and relevant legislation. It is essential to note that 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 (s 269S(1)).