Article 3.6. Minimal Operations and Processes
Operations or processes undertaken by themselves or in combination with each other for the purpose, such as those listed below, are considered to be minimal and shall not confer origin:
(a) ensuring preservation of goods in good condition for the purposes of transport or storage;
(b) facilitating shipment or transportation;
(c) packaging (1) or presenting goods for sale;
(d) affixing of marks, labels or other like distinguishing signs on products or their packaging;
(e) simple processes consisting of sifting, classifying, washing, cutting, slitting, bending, coiling and uncoiling and other similar operations; and
(f) mere dilution with water or another substance that does not materially alter the characteristics of the goods.
Article 3.7. De Minimis
1. A good which does not satisfy a change in tariff classification required pursuant to Annex 2 (Product Specific Rules) is nonetheless an originating good if the value of non-originating materials used in the production of the good that do not undergo the required change in tariff classification do not exceed ten percent of the FOB value of the good.
2. Notwithstanding paragraph 1, a good classified in Chapters 50 through 63 of the HS Code which does not satisfy a change in tariff classification required pursuant to Annex 2 (Product Specific Rules) may nonetheless be an originating good if the weight of all non-originating materials used in the production of the good that do not undergo the required change in tariff classification do not exceed ten percent of the total weight of the good.
3. The goods under paragraphs 1 and 2 shall meet all other applicable requirements of this Chapter.
Article 3.8. Direct Consignment
A good shall retain its originating status as determined under Article 3.2 (Origin Criteria) if either of the following conditions have been met:
(a) the good has been transported to the importing Party without passing through any non-Party; or
(b) the good has transited through a non-Party, provided that:
(i) the good has not entered the commerce of a non-Party;
(ii) the good has not undergone subsequent production or any other operation outside the territories of the Parties other than unloading, reloading, storing, or any other operations necessary to preserve it in good condition or to transport it to the other Party; and
(iii) the transit entry is justified for geographical, economic or logistical reasons.
Article 3.9. Packaging Materials and Containers for Retail Sale
Packaging materials and containers in which goods are packaged for retail sale, if classified with the goods, shall be disregarded in determining whether those goods have undergone the appropriate change in tariff classification set out in Annex 2 (Product Specific Rules). However, if the goods are subject to a QVC requirement, the value of the packaging and containers used for retail sale shall be considered as originating or non-originating, as the case may be, in calculating the value of the goods.
Article 3.10. Packing Materials and Containers for Shipment
The containers and packing materials exclusively used for the shipment of goods shall not be taken into account in determining the origin of any good.
Article 3.11. Accessories, Spare Parts, Tools or Instructional and Information Materials
1. Accessories, spare parts, tools or instructional and information materials normally presented with the goods shall be regarded as originating goods and shall be disregarded in determining whether or not all the non-originating materials used in the production of the originating goods have undergone the applicable change in tariff classification, provided that:
(a) the accessories, spare parts, tools or instructional and information materials are classified with and not invoiced separately from the goods; and
(b) the quantities of those accessories, spare parts, tools or instructional and information materials are customary for the good.
2. If the goods are subject to a QVC requirement, the value of the accessories, spare parts, tools or instructional and information materials shall be taken into account as originating materials or non-originating materials, as the case may be.
3. This Article does not apply where the accessories, spare parts, tools or instructional and information materials have been added solely for the purpose of artificially raising the QVC of the goods.
Article 3.12. Indirect Materials
Indirect materials shall be considered to be originating materials, without regard to where they were produced, and their value shall be the cost registered in the accounting records of the producer of the goods.
Article 3.13. Identical and Interchangeable Goods and Materials
For the purpose of establishing if a good is originating, when its manufacture utilises originating and non-originating materials, mixed or physically combined, the origin of such materials shall be determined by Generally Accepted Accounting Principles of stock control or inventory management applicable in the exporting Party.
Article 3.14. Declaration of Origin/Certificate of Origin
A claim that goods are eligible for preferential tariff treatment shall be supported by a Declaration of Origin or Certificate of Origin as set out in Annex 3 (Procedures and Verification).
Article 3.15. Denial of Preferential Tariff Treatment
The Customs Administration of the importing Party may deny a claim for preferential tariff treatment when:
(a) the good does not qualify as an originating good; or
(b) the importer, exporter or producer fails to comply with any of the relevant requirements of this Chapter.
Article 3.16. Review and Appeal
The importing Party shall grant the right of appeal in matters relating to the eligibility for preferential tariff treatment to producers, exporters or importers of goods traded or to be traded between the Parties, in accordance with its domestic laws, regulations and administrative practices.
Chapter FOUR. CUSTOMS PROCEDURES AND COOPERATION
Article 4.1. Definitions
For the purposes of this Chapter:
(a) Customs law means any legislation administered, applied, or enforced by the Customs Administration of a Party;
(b) Customs procedures means the treatment applied by the Customs Administration of each Party to goods that are subject to Customs control; and
(c) Express consignment means all goods imported by a person operating a commercial courier service for the expeditious international movement of goods who assumes liability to a Customs Administration for those goods.
Article 4.2. Objectives
The objectives of this Chapter are to:
(a) simplify and harmonise Customs procedures of the Parties;
(b) ensure consistency, predictability and transparency in the application of Customs laws and regulations of the Parties;
(c) promote efficient and expeditious clearance of goods;
(d) facilitate trade in goods between the Parties; and
(e) promote cooperation between the Customs Administrations.
Article 4.3. Scope
This Chapter applies, in accordance with the Parties’ respective laws, regulations and policies, to Customs procedures applied to goods traded between the Parties, and Customs cooperation between the Customs Administrations of the Parties.
Article 4.4. Customs Cooperation
1. To the extent permitted by their domestic laws, the Customs Administrations of the Parties shall assist each other, in relation to:
(a) implementation and operation of this Agreement;
(b) security of trade in goods between the Parties;
(c) prohibitions and restrictions on exports and imports; and
(d) such other issues as the Parties may determine.
2. To the extent permitted by their Customs laws, the Customs Administrations may provide each other with mutual assistance in order to prevent and/or investigate breaches of Customs law.
3. The Customs Administrations shall endeavour to provide to each other technical advice and assistance for the purpose of risk assessment, simplifying and expediting Customs procedures and improving technical skills.
4. Each Customs Administration shall provide the other Customs Administration with notice of any significant modification of Customs law or policies governing the movement of goods that is likely to substantially affect the operation of this Chapter.
Article 4.5. Facilitation
1. Each Party shall ensure that its Customs procedures and practices are predictable, consistent, transparent and facilitate trade in goods.
2. Customs procedures of the Parties shall, where possible, conform with the standards and recommended practices of the World Customs Organization, including those of the International Convention on the Simplification and Harmonization of Customs Procedures (as amended).
3. The Customs Administrations of the Parties shall conduct periodic reviews of Customs procedures to further simplify and develop mutually beneficial arrangements to facilitate the flow of goods between the Parties.
Article 4.6. Express Consignments
Each Party shall adopt procedures to expedite the clearance from Customs control of express consignments. Such procedures shall, inter alia:
(a) provide for pre-arrival processing of information related to express consignments;
(b) permit submission of a single document, where possible, in a form approved by the importing Party, covering all goods imported in any one express consignment through, if possible, electronic means; and
(c) minimise, to the extent possible, documentation required for the release of express consignments.
Article 4.7. Use of Automated Systems
1. The Customs Administrations of the Parties, in implementing initiatives that provide for the use of electronic declarations, shall take into account the methods agreed in the World Customs Organization.
2. The Customs Administrations of the Parties shall, as soon as practicable, adopt electronic procedures for all reporting requirements.
Article 4.8. Customs Valuation
The Parties shall determine the Customs value of goods in accordance with Article VII of the GATT 1994 and the Customs Valuation Agreement.
Article 4.9. Review and Appeal
1. Each Party shall provide, with regard to Customs administrative rulings, determinations or decisions, the right of appeal by the importer, exporter or any other person affected by that administrative ruling, determination or decision.
2. An initial right of appeal may be to an authority within the Customs Administration, but the legislation of each Party shall provide for the right of appeal to a judicial authority.
3. The decision on the appeal shall be given to the appellant and the reasons for such decision shall be provided in writing.
Article 4.10. Advance Rulings
1. Each Party shall provide in writing advance rulings with respect to the classification and origin (2) of goods to a person described in paragraph 2(a).
2. Each Party shall adopt or maintain procedures for advance rulings, which shall:
(a) provide that an importer, an exporter or producer of a Party may apply for an advance ruling before importation of the goods in question;
(b) require that an applicant for an advance ruling provide a detailed description of the goods and all relevant information needed to process an application for an advance ruling;
(c) provide that its Customs Administration may, at any time during the course of an evaluation of an application for an advance ruling, request that the applicant provide additional information within a specified period;
(d) provide that any advance ruling be based on the facts and circumstances presented by the applicant, and any other relevant information in the possession of the decision-maker;
(e) endeavour to issue an advance ruling to the applicant expeditiously within 40 days but shall in any case do so within 90 days of receipt of all necessary information; (3) and
(f) ensure that any decision to decline or make an advance ruling, or any failure to comply with subparagraph (e), is promptly notified to the applicant together with the reasons for that decision or delay in making the ruling.
3. A Party may reject requests for an advance ruling where the additional information requested by it in accordance with paragraph 2(c) is not provided within a specified period.
4. Subject to paragraph 5, each Party shall apply an advance ruling to all importations of goods described in that ruling imported into its territory within three years of the date of that ruling.
5. A Party may modify or revoke an advance ruling upon a determination that the advance ruling was based on an error of fact or law (including human error), or if there is a change in:
(a) domestic law consistent with this Agreement;
(b) a material factor; or
(c) the circumstances on which the ruling was based.
6. Any fees charged for advance rulings shall not exceed the approximate cost of the service rendered in providing the advance ruling.
Article 4.11. Release of Goods
Each Party shall adopt or maintain procedures which allow goods to be released within 48 hours of submission of all relevant Customs import documents unless:
(a) the importer fails to provide any information required by the importing Party at the time of first entry;
(b) the goods are selected for closer examination by the competent authority of the importing Party through the application of risk management techniques;
(c) the goods are to be examined by any agency, other than the competent authority of the importing Party, acting under powers conferred by the domestic legislation of the importing Party; or
(d) fulfilment of all necessary Customs formalities has not been able to be completed or release is otherwise delayed by virtue of force majeure.
Article 4.12. Early Resolution of Differences
1. Where significant differences between the Customs Administrations of the Parties arise with respect to the application of this Chapter, a Party’s Customs Administration may request consultations with the other Party’s Customs Administration to resolve such differences. The modalities of such consultations shall be agreed between the Customs Administrations.
2. Consultations pursuant to this Article are without prejudice to the rights of the Parties under Chapter 16 (Dispute Settlement) or under the WTO Understanding on Rules and Procedures Governing the Settlement of Disputes.
Article 4.13. Risk Management
1. The Parties shall endeavour to administer Customs procedures so as to facilitate the expeditious clearance of low risk goods thereby allowing their resources to be focused on high risk goods. The Customs Administrations shall regularly review these procedures.
2. Where a Party deems that an inspection of goods is not necessary to authorise their clearance from Customs control, it shall endeavour to provide a single point for the documentary or electronic processing of those goods.
Article 4.14. Security of Trade In Goods
The Customs Administrations shall, as necessary, consult with a view to agreeing procedures to secure the movement of goods between the Parties.
Article 4.15. Publication and Enquiry Points
1. Each Party shall publish on the Internet and/or in print form all statutory and regulatory provisions and procedures applicable or enforced by its Customs Administration.
2. Each Party shall designate one or more enquiry points to address enquiries from interested persons of the other Party concerning Customs matters, and shall make available on the Internet, and/or print form, information concerning procedures for making such enquiries.
Chapter FIVE. TRADE REMEDIES
Section A. General Trade Remedies
Article 5.1. General Provisions
1. Each Party shall retain its rights and obligations under the WTO Agreement on Implementation of Article VI of GATT 1994 (“Anti-Dumping Agreement”), the WTO Agreement on Subsidies and Countervailing Measures, Article XIX of GATT 1994 and the WTO Agreement on Safeguards.
2. The Parties shall endeavour to carry out any trade remedy actions in a transparent manner.
Article 5.2. Anti-Dumping Measures
1. As soon as possible, but no longer than five working days, following the receipt of a properly documented application from an industry in one Party for the initiation of an anti-dumping investigation in respect of products from the other Party, the Party that has received the properly documented application shall give written notice to the other Party through the Contact Points designated pursuant to this Chapter.
2. Where a Party considers that in accordance with Article 5 of the Anti- Dumping Agreement, there is sufficient evidence to justify the initiation of an anti- dumping investigation, it shall provide the notification required by Article 12.1 of that Agreement in writing to the other Party within five working days of the decision to initiate an investigation.
3. A Party shall respond within ten working days of any request for consultations made in accordance with Article 17.2 of the Anti-Dumping Agreement, in respect of a decision to initiate an investigation. This is without prejudice to the rights of the Parties under Article 17 of the Anti-Dumping Agreement.
4. The time period to be used for determining if the volume of dumped imports is “negligible”, as the term is understood in Article 5.8 of the Anti- Dumping Agreement, shall be either:
(a) the period of data collection for the dumping investigation;
(b) the most recent 12 consecutive months prior to initiation for which data are available; or
(c) the most recent 12 consecutive months prior to the date on which the application was filed, for which data are available, provided that the lapse of time between the filing of the application and the initiation of the investigation is no longer than 90 days.
5. Each Party shall inform the other Party through their designated Contact Points at the time of entry into force of this Agreement which of the time periods in paragraph 4 they shall use. If in any investigation the chosen methodology is not utilised, one of the two other methodologies shall be adopted and the other Party shall be notified through their Contact Point of the change in methodology, along with an explanation of the reasons for the change. Any Party which adopts the time period mentioned in paragraph 4(c) shall also notify which of the other two time periods they shall use in any case in which the lapse of time between the filing of the application and the initiation of the investigation is longer than 90 days, unless a Party's domestic law prohibits such a lapse.
Article 5.3. Global Safeguards
A Party taking any global safeguard measure pursuant to Article XIX of GATT 1994 and the WTO Agreement on Safeguards may exclude imports of an originating product of the other Party from the action where such imports are not a cause of serious injury or threat thereof.
Article 5.4. Contact Points
Each Party shall designate one or more Contact Points for the purposes of this Chapter and provide details of such Contact Points to the other Party. The Parties shall notify each other promptly of any amendments to the details of their Contact Points.
Section B. Transitional Bilateral Safeguards
Article 5.5. Definitions
For the purposes of this Section:
(a) Domestic industry means, with respect to an imported product, the producers as a whole of the like or directly competitive product or those producers whose collective production of the like or directly competitive product constitutes a major proportion of the total domestic production of such product;
(b) Provisional measure means a provisional bilateral safeguard measure described in Article 5.9 (Provisional Measures);
(c) Safeguard measure or safeguard measures means a transitional bilateral safeguard measure or measures described in Article 5.6 (Application of Safeguard Measures);
(d) Serious injury means a significant overall impairment in the position of a domestic industry;
(e) Threat of serious injury means serious injury that is clearly imminent and shall be determined on the basis of facts and not merely on allegation, conjecture or remote possibility; and
(f) Transition period, in relation to a particular product, means the period from the entry into force of this Agreement until two years after the date on which the Customs duty on that product is to be eliminated in accordance with Annex 1 (Schedules of Tariff Commitments).
Article 5.6. Application of Safeguard Measures
If, as a result of the reduction or elimination of a Customs duty pursuant to this Agreement, an originating product of a Party is being imported into the other Party’s territory in such increased quantities, in absolute terms or relative to domestic production, and under such conditions as to cause or threaten to cause serious injury to a domestic industry producing like or directly competitive products, the other Party may, to the extent necessary to prevent or remedy serious injury and facilitate adjustment, apply a safeguard measure consisting of:
(a) the suspension of the further reduction of any rate of Customs duty provided for under this Agreement on the originating product from the date on which the action to apply the safeguard measure is taken; or
(b) an increase of the rate of Customs duty on the originating product to a level not to exceed the lesser of:
(i) the Most Favoured Nation (“MFN”) applied rate of Customs duty in effect on the date on which the action to apply the safeguard measure is taken;
(ii) the MFN applied rate of Customs duty in effect on the day immediately preceding the date of entry into force of this Agreement; or
(iii) for a new safeguard measure applied from 2016, the preferential tariff rate in effect under this Agreement on the day three years preceding the date on which the action to apply the safeguard measure is taken.