(b) import licensing conditioned on the fulfilment of a performance requirement; or
(c) voluntary export restraints.
3. Paragraphs 1 and 2 shall not apply to the measures set out in Annex 3-A.
4. Each Party shall ensure the transparency of any non-tariff measures permitted in paragraph 1 and shall ensure that any such measures are not prepared, adopted or applied with a view to, or with the effect of, creating unnecessary obstacles to trade between the Parties.
Article 3.10. Administrative Fees and Formalities
1. Each Party shall ensure, in accordance with Article VII:1 of GATT 1994 and its interpretative notes, that all fees and charges of whatever character (other than import and export duties, charges equivalent to an internal tax or other internal charge applied consistently with Article III:2 of GATT 1994, and antidumping and countervailing duties) imposed on or in connection with importation or exportation are limited in amount to the approximate cost of services rendered and do not represent an indirect protection to domestic goods or a taxation of imports or exports for fiscal purposes.
2. Neither Party may require consular transactions, including related fees and charges, in connection with the importation of any good of the other Party.
3. Each Party shall make available through the Internet or a comparable computer based telecommunications network a current list of the fees and charges it imposes in connection with importation or exportation.
Article 3.11. Export Taxes
Neither Party may adopt or maintain any duty, tax or other charge on the export of any good to the territory of the other Party, unless such duty, tax or charge is adopted or maintained on any such good when destined for domestic consumption.
Article 3.12. Treatment of Certain Spirits
1. Australia confirms that the Australia New Zealand Food Standards Code ("the Code") allows recognition of Chilean Pisco as a product exclusively manufactured in Chile and that no variation to the Code is necessary for such recognition.
2. To the extent contemplated in the Code, Australia shall not permit the sale of any product as Chilean Pisco unless it has been manufactured in Chile according to the laws of Chile governing the manufacture of Chilean Pisco and complies with all applicable Chilean regulations for the consumption, sale, or export as Chilean Pisco.
Section F. Agriculture
Article 3.13. Agricultural Export Subsidies
1. The Parties share the objective of the multilateral elimination of export subsidies for agricultural goods and shall work together toward an agreement in the WTO to eliminate those subsidies and prevent their reintroduction in any form.
2. Neither Party shall introduce or maintain any export subsidy on any agricultural good destined for the territory of the other Party.
Section G. Other Measures
Article 3.14. Administration of Trade Regulations
In accordance with Article X of GATT 1994, each Party shall administer in a uniform, impartial and reasonable manner all its laws, regulations, judicial decisions and administrative rulings pertaining to:
(a) the classification or the valuation of products for customs purposes;
(b) rates of duty, taxes or other charges;
(c) requirements, restrictions or prohibitions on imports or exports;
(d) the transfer of payments; and
(e) issues affecting sale, distribution, transportation, insurance,
warehousing, inspection, exhibition, processing, mixing or other use of products for customs purposes.
Section H. Institutional Provisions
Article 3.15. Committee on Trade In Goods
1. The Parties hereby establish a Committee on Trade in Goods, comprising representatives of each Party.
2. The Committee shall meet at the request of either Party or the Joint FTA Committee to consider any matter arising under this Chapter, Chapter 4 (Rules of Origin) or Chapter 5 (Customs Administration).
3. The Committee shall meet at such venues and times as may be agreed by the Parties. Meetings may be held via teleconference, videoconference or through any other means as mutually determined by the Parties.
4. The Committee's functions shall include:
(a) promoting trade in goods between the Parties, including through consultations on accelerating tariff elimination under this Agreement and other issues as appropriate; and
(b) addressing barriers to trade in goods between the Parties, especially those related to the application of non-tariff measures, and, if appropriate, referring such matters to the Joint FTA Committee for its consideration.
Annex 3-A. Exceptions to elimination of import and export restrictions
Paragraphs 1 and 2 of Article 3.9 shall not apply to:
(a) with respect to Australia:
(i) control by Australia on the exports of woodchips and unprocessed forest products (e.g., whole logs) sourced from native forests outside Regional Forest Agreement regions, or plantation forests within States where Codes of Practice have not been approved by the Australian Government, and Sandalwood (Santalum spicatum) sourced from any State, the Australian Capital Territory, or the Northern Territory; and
(ii) the provisions of and measures under the Livestock Export (Merino) Orders, made under the Export Control Act of 1982, as amended.
(b) with respect to Chile, measures concerning the importation of used vehicles as provided in Law No 18.483 or its successor.
Annex 3-B. Elimination of customs duties
Section 1. Schedule of Australia
Customs Duties on Goods Originating in Chile
Introductory notes
I. Australia's tariff schedule in this Annex contains the following five columns:
(a) Code: the code used in the nomenclature of the Harmonized System 2007;
(b) Description: the description of the product falling under the heading;
(c) Base Rate: the basic customs duty from which the tariff elimination program starts; and
(d) Category: the category under which the product concerned falls for the purposes of tariff elimination.
II. The categories which are applicable to imports into Australia from Chile are the following:
1) Year 0: customs duties shall be eliminated entirely and such goods shall be duty-free on the date this Agreement enters into force.
| Entry into force | |
| Margin of preference | 100% |
2) Year 6: customs duties shall be removed in seven equal annual stages beginning on the date this Agreement enters into force, and such goods shall be duty-free, effective 1 January 2015.
| Entry into force | 01/01/2010 | 01/01/2011 | 01/01/2012 | 01/01/2013 | 01/01/2014 | 01/01/2015 | |
| Margin of preference | 14.3% | 28.6% | 42.9% | 57.2% | 71.5% | 85.8% | 100% |
3) Year 6 TX: customs duties shall be duty-free, effective 1 January 2015.
| Entry into force | 01/01/2010 | 01/01/2011 | 01/01/2012 | 01/01/2013 | 01/01/2014 | 01/01/2015 | |
| Margin of preference | 0% | 0% | 0% | 0% | 0% | 0% | 100% |
Note: Under existing law, Australia's most-favoured-nation rates for some textiles, clothing and footwear products are scheduled to be reduced on 1 January 2010.
Section 2. Schedule of Chile
Customs Duties on Goods Originating in Australia
Introductory notes
I. Chile's tariff schedule in this Annex contains the following five columns:
(a) Code: the code used in the nomenclature of the Harmonized System 2007;
(b) Description: the description of the product falling under the heading;
(c) Base Rate: the basic customs duty from which the tariff elimination program starts;
(d) Category: the category under which the product concerned falls for the purposes of tariff elimination; and
(e) Observation: additional information if it corresponds.
II. The categories which are applicable to imports into Chile from Australia are the following:
1) Year 0: customs duties shall be eliminated entirely and such goods shall be duty-free on the date this Agreement enters into force.
| Entry into force | |
| Margin of preference | 100% |
2) Year 6: customs duties shall be removed in seven equal annual stages beginning on the date this Agreement enters into force, and such goods shall be duty-free, effective 1 January 2015.
| Entry into force | 01/01/2010 | 01/01/2011 | 01/01/2012 | 01/01/2013 | 01/01/2014 | 01/01/2015 | |
| Margin of preference | 14,3% | 28,6% | 42,9% | 57,2% | 71,5% | 85,8% | 100% |
3) Year 6 TX: customs duties shall be duty-free, effective 1 January 2015.
| Entry into force | 01/01/2010 | 01/01/2011 | 01/01/2012 | 01/01/2013 | 01/01/2014 | 01/01/2015 | |
| Margin of preference | 0% | 0% | 0% | 0% | 0% | 0% | 100% |
4) Category W: duties on goods provided for in the items in staging category W shall be reduced by 16,7 per cent of the base rate on 1 January of entry into force, and by an additional 8,3 per cent of the base rate each year thereafter through year three. Beginning 1 January of year four, duties on these goods shall be reduced by an additional 16,7 per cent of the base rate annually through year eight and shall be duty-free effective 1 January 2015; and
| Entry into force | 01/01/2010 | 01/01/2011 | 01/01/2012 | 01/01/2013 | 01/01/2014 | 01/01/2015 | |
| Margin of preference | 16,7% | 25% | 33,3% | 50% | 66,7% | 83,3% | 100% |
5) Sugar Category: the ad-valorem duty (6 per cent) will be charged in accordance with the following schedule:
| Date | Ad-valorem duty to be charged |
| 01/01/2009 | 3,00% |
| 01/01/2010 | 1,98% |
| 01/01/2011 | 1,02% |
| 01/01/2012 | 0,00% |
For greater certainty it is understood that this phase out schedule is only applicable to the ad-valorem duty (6 per cent) imposed by Chile to other countries for the following tariff lines (1701.11.00, 1701.12.00, 1701.91.00, 1707.99.10, 1701.99.20, and 1701.99.90)
The specific tariff will continue to apply for the products considered under Law No. 18.525 or its successor.
Chapter 4. Rules of Origin
Article 4.1. Definitions
For the purposes of this Chapter:
(a) adjusted value means:
(i) in the case of a good to be exported from one Party to another, the value determined under the Customs Valuation Agreement, as adjusted to exclude any costs, charges, or expenses incurred for transportation, insurance, and related services incidental to the international shipment of the good from the country of exportation to the place of importation;
(ii) in the case of a material, the total of all prices actually paid or payable to acquire the materials to which the transaction relates in accordance with the Customs Valuation Agreement;
(b) Customs Valuation Agreement means the Agreement on Implementation of Article VU of the General Agreement on Tariffs and Trade 1994, contained in Annex 1A of the WTO Agreement;
(c) exporter means a person who exports goods from the exporting Party;
(d) fungible goods or materials means goods or materials that are identical or interchangeable as result of being of the same kind and commercial quality, possessing the same technical and physical characteristics, and which cannot be distinguished from one another for origin purposes by virtue of any markings or mere visual examination;
(e) generally accepted accounting principles means the recognised consensus or substantial authoritative support in the territory of a Party, with respect to the recording of revenues, expenses, costs, assets and liabilities; the disclosure of information; and the preparation of financial statements. These standards may encompass broad guidelines of general application as well as detailed standards, practices and procedures;
(f) importer means a person who imports goods into the importing Party;
(g) indirect material means a material used in the production, testing or inspection of a good but not physically incorporated into the good, or a material or good used in the maintenance of buildings or the operation of equipment associated with the production of a good including:
(i) fuel and energy;
(ii) tools, dyes and moulds;
(ii) spare parts and materials;
(iv) lubricants, greases, compounding materials and other materials used in production;
(v) gloves, glasses, footwear, clothing, safety equipment and supplies;
(vi) equipment, devices and supplies used for testing or inspecting the good;
(vii) catalysts and solvents; and
(viii) any other materials that are not incorporated into the good but whose use in the production of the good can reasonably be demonstrated to be a part of that production;
(h) material means any good, used or consumed in the production of another good, and physically incorporated into or classified with that good;
(i) originating material means a material that qualifies as originating in accordance with the relevant provisions of this Chapter;
(j) preferential tariff treatment means the rate of customs duties applicable to an originating good of the exporting Party in accordance with Annex 3-B; and
(k) producer means a person who engages in the production of goods or materials.
Article 4.2. Originating Goods
For the purposes of this Agreement, a good is an originating good of a Party and, subject to Article 4.18, eligible for a preferential tariff, if it:
(a) is a wholly obtained good of a Party;
(b) is produced entirely in the territory of a Party exclusively from originating materials;
(c) satisfies all applicable requirements of Annex 4-C, as a result of processes performed entirely in the territory of one or both of the Parties by one or more producers; or
(d) otherwise qualifies as an originating good under this Chapter;
and meets all other applicable requirements of this Chapter.
Article 4.3. Wholly Obtained Goods
For the purposes of Article 4.2, a wholly obtained good of a Party means:
(a) mineral and other naturally occurring goods extracted in or from the territory of a Party;
(b) vegetable goods (4-3), as such goods are defined in the Harmonized System, harvested, picked or gathered in the territory of a Party;
(c) live animals born and raised in the territory of a Party; (d) goods obtained from live animals in the territory of a Party;
(e) goods obtained from hunting, trapping, fishing, gathering, capturing or aquaculture conducted in the territory of a Party;
(f) goods (fish, shellfish and other marine life) taken from the high seas by vessels registered or recorded with a Party and flying its flag;
(g) goods obtained or produced on board factory ships registered or recorded with a Party and flying its flag, from the goods referred to in subparagraph (f);
(h) goods taken by a Party or a person of a Party from the seabed or beneath the seabed outside the territorial sea, provided that a Party has a right to exploit such seabed in accordance with international law;
(i) waste and scrap derived from:
(i) production in the territory of a Party; or
(ii) used goods collected in the territory of a Party;
provided that such goods are fit only for the recovery of raw materials; and
(j) goods produced or obtained entirely in the territory of a Party exclusively from goods referred to in subparagraphs (a) to (i).
Article 4.4. Cumulation
A good which is an originating good of a Party pursuant to Article 4.2 and is used in the production of a good or goods in the territory of the other Party shall be considered to originate in the territory of that other Party.
Article 4.5. De Minimis
1. A good that does not satisfy a change in tariff classification requirement pursuant to Annex 4-C is nonetheless an originating good if:
(a) the value of all non-originating materials used in the production of the good that do not undergo the required change in tariff classification does not exceed 10 per cent of the adjusted value of the good (as calculated in accordance with Article 4.12); and
(b) the good meets all other applicable criteria of this Chapter.
2. The value of such non-originating materials shall, however, be included in the value of non-originating materials for any applicable regional value content requirement for the good.
Article 4.6. Accessories, Spare Parts and Tools
1. For the purposes of determining the origin of a good, accessories, spare parts, tools and instructional or other information resources presented with the good shall be considered originating goods, and shall be disregarded in determining whether all the non-originating materials used in the production of the originating good have undergone the applicable change in tariff classification or production process requirement.
2. If the good is subject to a regional value content requirement, the value of the accessories, spare parts, tools and instructional or other information resources presented with the good is to be taken into account as originating or non-originating, as the case may be, in calculating the regional value content of the good.
3. Paragraph 1 and 2 shall only apply provided that:
(a) the accessories, spare parts, tools and instructional or other information resources presented with the good are not invoiced separately from the good; and
(b) the quantities and value of the accessories, spare parts, tools and instructional or other information resources presented with the good are customary for that good.
4. Where accessories, spare parts and tools are not customary for the good or are invoiced separately from the good, they shall be treated as separate goods for the purpose of origin determination.
Article 4.7. Fungible Goods and Materials
1. The determination of whether fungible goods or materials are originating goods shall be made either by physical segregation of each of the materials, or through the use of an inventory management method recognised in the generally accepted accounting principles of the Party in which the production is performed or otherwise accepted by that Party.
2. A Party shall provide that an inventory management method selected under paragraph 1 for particular fungible goods or materials shall continue to be used for those fungible goods or materials throughout its fiscal year.
Article 4.8. Packaging Materials and Containers
1. Packaging materials and containers for transportation and shipment of a good shall not be taken into account in determining the origin of any good.
2. Packaging materials and containers in which a good is packaged for retail sale, when classified together with that good, shall not be taken into account in determining whether all of the non-originating materials used in the production of the good have met the applicable change in tariff classification or production process requirements as set out in Annex 4-C.
3. If a good is subject to a regional value content requirement then the value of the packaging materials in which the good is packaged for retail sale shall be taken into account as originating or non-originating materials, as the case may be, in calculating the regional value content of the good.
4. Where the quantity or value of the packaging materials is not reasonable for the good, its value shall not be included as originating in a regional value content calculation for the good.
Article 4.9. Sets or Composite Goods
1. A set put up for retail sale or composite good that is classifiable pursuant to Rule 3 of the General Rules for the Interpretation of the Harmonized System, shall be considered as originating, provided that: (a) all the component goods are originating; or (b) the value of the non-originating component goods does not exceed 25 per cent of the total adjusted value (as calculated in accordance with Article 4.12) of the good put up in a set for retail sale or composite good.
2. The origin of packaging materials and containers for a set put up for retail sale or composite good shall be determined in accordance with Article 4.8.