Are you ready? Australia's Free Trade Agreement with China (CHAFTA) | December 2015
The Chinese Australia Free Trade Agreement (ChAFTA) is close to coming into effect by the end of 2015 or early 2016 - Australian has completed its domestic legislation on 9th November and now just waiting on the Chinese Government to ratify its legislation.
Tariffs on most Chinese Origin goods imported into Australia after the commencement of the Agreement will be duty free. However, certain tariffs on some categories imported from China will be phased out, generally over 3 or 5 years. For example, certain fabrics, footwear, clothing, nut products and car parts are too phased down. For specific tariff schedule and applicable rates once the FTA comes into force contact your local customs broker.
Both governments have now announced the government authorized bodies to issue Certificate of Origins (COO) to gain preferential rates of duties:
For IMPORTS from China to Australia the authorised bodies to issue certificates are
- China Council for the Promotion of International Trade (CCPIT)
- General Administration of Quality Supervision Inspection and Quarantine (AQSIQ)
For EXPORTS from Australia to China the authorised bodies in Australia for certificates of origin (COO) are
- Australian Industry Group (AiG)
- Australian Chamber of Commerce and Industry (ACCI)
- Australian Grape and Wine Authority (AGWA) (authorised to issue certificates for wine and wine products only)
Attached is copy of the Chinese COO format which the certificates must be based on and needs to be authorised by one of the above 2 bodies and completed in English and can only include multiple goods not exceeding 20 items (any more than 20 items will need a new COO)
What to do now?
Contact you local customs broker.
Now is the time you need to be contacting your local customs broker to ensure you are aware of new impending requirements, have organised COO to accompany shipping documents to guarantee duty savings.
Exception relating to Hong Kong
One important note is the consignment provision of ChAFTA spells out is that goods transported through non-parties MUST REMAIN UNDER CUSTOMS CONTROL. Hong Kong is considered a non-Party to the ChAFTA and the Australian Government is aware of the issue that Hong Kong is a free port and goods that touch Hong Kong soil may be void and not able to claim Free trade status which may cause some issues for some importers/exporters. The Government is hoping to put out a notice shortly on how different scenarios will exist and how they will be treated with regards to gaining preference or not.
If you have further queries or require clarification please contact your local customs brokers, export representative or customer service representative.