ChAFTA - AUSTRALIA & CHINA FTA INFORMATION
Attachments: With this article are the following attachments
As reported by the Department of Foreign Affairs and Trade (DFAT), the China-Australia Free Trade Agreement (ChAFTA) was formally signed in Canberra on 17 June 2015. Both sides will now commence domestic processes to bring the FTA into force as soon as possible.
The attached “outcomes at a glance” document, as provided on the DFAT website provides a snapshot of the results for Australian Importers and Exporters under the ChAFTA agreement.
Further detail are available on the Australian Governments Department of Foreign Affairs and Trade website. China-Australia Free Trade Agreement (ChAFTA). (Below information is provided based on published information on the DFAT and other governenment websites)
How will Australian Exporters be effected by ChAFTA?
Reportedly approximately 85% of Australian goods exported to China will be Tariff Free in the first 4 to 5 years with an additional 10% Duty free with the next 11 years.
Agriculture (Beef, Dairy and Wine) exporters will see tariffs drop by as much as 25% over the next decade. The Resources and Energy sector as well as Manufactured products to China will see almost 93% of these products entering duty free and once the agreement is fully implemented 99.9% of Australia’s resources, energy and manufacturing will enjoy duty free trade into China.
What are the effects of the China-Australia Free Trade Agreement for Australian importers?
Australian Tariffs on Chinese imports will be eliminated progressively over the next few years. This will include the 5% tariff on Chinese manufacturing exports, electronics and white goods. A copy of the current Tariff Schedule for the Reduction of tariffs on imported goods from China can be located on the DFAT website called Annex 1 Tariff schedule of Australia
What is the timeline for the ChAFTA to be fully in place?
As reported on the DFAT website, the next steps, in accordance with normal Australian treaty-making processes involve a joint standing committee inquiry into the agreement with a report to be tabled to Parliament within a usual timeframe of 20 joint sitting days. Parliament will then consider any amendments to the legislation.
Likewise the Chinese Government will undertake its own domestic process and when both parties are complete and have exchanged their diplomatic notes the agreement will be ready to enter into force. ChAFTA will enter into force 30 days after this exchange or on a date otherwise agreed.
Separately, the Senate References Committee on Foreign Affairs, Defence and Trade, has established an inquiry into ChAFTA, to report within one month of JSCOT.
A copy of the Implementation process and timeline is attached for your reference.
As an Importer from China how will I ensure I qualify for ChAFTA?
To be accepted under ChAFTA, goods imported into Australia will need to meet the requirements of “originating goods” by providing a Certificate of Origin (COO) or a Declaration of Origin (DOO), issued by an authorised body of the exporting country. As yet these Authorised department have yet to be named. These documents will be a requirement for each individual shipment. Chapter 3 – Rules of Origin and Implementation Procedures outlines these requirements and provides more detailed information regarding Rules of Origin, including the agreement by both parties to a review of the origin documentary requirements within 3 years of the agreement commencement. Please see attached.
A sample Certificates of Origin and Declaration of Origin document is also included in Chapter 3.
Should you require any further information regarding this, please contact your local TCF International representative.