Title
INDIA - AUSTRALIA ECONOMIC COOPERATION AND TRADE AGREEMENT
Preamble
PREAMBLE
The Government of the Republic of India ("India") and the Government of Australia ("Australia"), hereinafter referred to individually as a "Party" and collectively as "the Parties":
BUILDING upon the historic ties and friendship between the Parties, and progress made by both the Parties during their previous bilateral negotiations;
RESOLVING to strengthen their economic relations, further liberalise and expand trade and investment, enhance economic growth, create opportunities for workers and business, improving living standards, and promote sustainable growth;
RECALLING the Parties' commitment under the Joint Statement on a Comprehensive Strategic Partnership between India and Australia made in June 2020 and at the 17th India-Australia Joint Ministerial Commission in September 2021;
DECIDING to establish an agreement that will ultimately lead to the conclusion of a fuller Comprehensive Economic Cooperation Agreement;
FURTHER RESOLVING that the fuller Comprehensive [Economic Cooperation Agreement will aim to promote further economic integration to liberalise trade and investment;
RECOGNISING the need for a balanced trade agreement that encourages trade and investment flows that will benefit the economies of both the Parties;
MINDFUL of their commitments in international and regional organisations, especially aware of the increasing importance of trade for the future prosperity of the economies of the Asia-Pacific region;
ACKNOWLEDGING the important role and contribution of business in expanding trade between the Parties, and the need to further promote and facilitate cooperation and utilisation of the greater business opportunities provided by this Agreement;
DESIRING to explore new areas of economic cooperation and develop appropriate measures for closer economic cooperation between the Parties;
RECOGNISING their right to regulate in order to meet national policy objectives, and determining to preserve their flexibility in setting legislative and regulatory priorities to protect legitimate public welfare objectives; and
REAFFIRM their commitment to work together, protect, shape, and strengthen the rules-based, transparent, non-discriminatory, and inclusive multilateral trading system embodied by the WTO;
HAVE AGREED, AS FOLLOWS:
Body
Chapter 1. INITIAL PROVISIONS AND GENERAL DEFINITIONS
Article 1.1. Establishment of a Free Trade Area
The Parties, consistent with Article XXIV of GATT 1994 and Article V of GATS, hereby establish a free trade area in accordance with the provisions of this India-Australia Economic Cooperation and Trade Agreement.
Article 1.2. Objectives
The Objectives of this Agreement Are to:
(a) establish a framework for strengthening and enhancing the economic, trade and investment relationship between the Parties;
(b) liberalise and promote trade in goods in accordance with Article XXIV of the GATT 1994;
(c) liberalise and promote trade in services in accordance with Article V of GATS;
(d) improve the efficiency and competitiveness of their manufacturing and services sectors and to expand trade and investment between the Parties; and
(e) facilitate, enhance and explore new areas of economic cooperation and develop appropriate measures for closer economic cooperation between the Parties.
Article 1.3. General Definitions
For the purposes of this Agreement, unless otherwise specified:
1. (a) Agreement means the India-Australia Economic Cooperation and Trade Agreement;
2. (b) Anti-Dumping Agreement means the Agreement on Implementation of Article VI of GATT 1994, set out in Annex 1A to the WTO Agreement;
3. (c) Agreement on Agriculture means the Agreement on Agriculture, set out in Annex 1A to the WTO Agreement;
4. (d) Customs Valuation Agreement means the Agreement on Implemeniation of Article Vil of GATT 1994, set out in Annex 1A of the WTO Agreement;
5. (e) days means calendar days, including weekends and holidays;
6. (f) GATS means the General Agreement on Trade in Services, set out in Annex 1B of the WTO Agreement;
7. (g) GATT 1994 means the General Agreement on Tariffs and Trade 7994, set out in Annex 1A of the WTO Agreement;
8. (h) goods means any merchandise, product, article or material;
9. (i) Harmonized System ("HS") means the Harmonized Commodity Description and Coding System defined in the International Convention on the Harmonized Commodity Description and Coding System, including its General Rules of Interpretation, and legal notes which includes Section Notes and Chapter Notes, as adopted and implemented by the Parties in their respective laws;
10. (j) IMF Articles of Agreement means the Articles of Agreement of the International Monetary Fund adopted at Bretton Woods on 22 July 1944;
11. (k) Joint Committee means the Joint Committee established pursuant to Article 12.1 (Establishment of the Joint Committee - Administrative and Institutional Provisions);
12. (l) measure means any measure by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action, or any other form;
13. (m) originating goods means goods that qualify as originating in accordance with Chapter 4 (Rules of Origin);
14. (n) perishable goods means goods that rapidly decay due to their natural characteristics, in particular in the absence of appropriate storage conditions;
15. (o) Safeguards Agreement means the Agreement on Safeguards, set out in Annex 1A to the WTO Agreement;
16. (p) SCM Agreement means Agreement on Subsidies and Countervailing Measures, set out in Annex 1A to the WTO Agreement;
17. (q) Subcommittee on Trade in Goods means the subcommittee established pursuant to Article 2.12 (Subcommittee on Trade in Goods - Trade in Goods);
18. (r) Subcommittee on Trade in Services means subcommittee established pursuant to Article 8.24 (Subcommittee on Trade in Services - Trade in Services);
19. (s) territory means:
(i) in respect of Australia, the territory of Australia:
(A) excluding all external territories other than the Territory of Norfolk Island, the Territory of Christmas Island, the Territory of Cocos (Keeling) Islands, the Territory of Ashmore and Cartier Islands, the Territory of Heard Island and McDonald Islands, and the Coral Sea Islands Territory; and
(B) including Australia's territorial sea, contiguous zone, exclusive economic zone and continental shelf over which Australia exercises sovereignty, sovereign rights or jurisdiction in accordance with international law including the United Nations Convention on the Law of the Sea, done at Montego Bay on 10 December 1982; and
(ii) in respect of India, the territory of the Republic of India, in accordance with the Constitution of India, including its land territory, its territorial waters, and the airspace above it and other maritime zones including the Exclusive Economic Zone and continental shelf over which the Republic of India has sovereignty, sovereign rights, and/or exclusive jurisdiction, in accordance with its laws and regulations in force, and international law, including the United Nations Convention on the Law of the Sea, done at Montego Bay, 10 December 1982.
(t) WTO means the World Trade Organization; and
(u) WTO Agreement means the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh on 15 April 1994.
Article 1.4. Relation to other Agreements
1. The Parties affirm their rights and obligations with respect to each other under the WTO Agreement and other existing agreements to which both the Parties are party.
2. In the event of any inconsistency between this Agreement and any other agreement to which the Parties are party, the Parties shall immediately consult with each other with a view to finding a mutually satisfactory solution.
Chapter 2. TRADE IN GOODS
Article 2.1. Definitions
For the purposes of this Chapter:
(a) consular transactions means requirements that goods of a Party intended for export to the territory of the other Party must first be submitted to the supervision of the consul of the importing Party in the territory of the exporting Party for the purpose of obtaining consular invoices or consular visas for commercial invoices, certificates of origin, manifests, shippers' export declarations, or any other customs documentation required on or in connection with importation;
(b) customs duty means any duty or charge of any kind imposed on or in connection with the importation of a good, and any cess, surtax or surcharge imposed in connection with such importation, but does not include any:
(i) charge equivalent to an internal tax imposed consistently with Article Ill:2 of GATT 1994;
(ii) fee or other charge in connection with the importation commensurate with the cost of services rendered; or
(iii) anti-dumping or countervailing duty applied pursuant to the laws of a Party and applied consistently with the provisions of Article VI of GATT 1994, the Anti-Dumping Agreement, and the SCM Agreement;
(c) goods of a Party means domestic products as these are understood in GATT 1994 or such goods as the Parties may agree, and includes originating goods of a Party.
Article 2.2. Scope
Unless otherwise provided in this Agreement, this Chapter shall apply to trade in goods of a Party.
Article 2.3. Elimination or Reduction of Customs Duties
1. Unless otherwise provided in this Agreement, neither Party shall increase any existing customs duty, or adopt any new customs duty, on an originating good.
2. Each Party shall progressively eliminate or reduce its customs duties on originating goods in accordance with its Schedule in Annex 2A (Tariff Commitments).
3. On request of a Party, the Parties shall consult to consider accelerating the elimination of customs duties set out in their Schedules in Annex 2A (Tariff Commitments). An agreement by the Parties to accelerate the elimination of a customs duty on a good shall supersede any duty rate or staging category determined in accordance with their Schedules in Annex 2A (Tariff Commitments) for that good when approved by each Party in accordance with its applicable domestic requirements, including internal legal procedures.
4. A Party may at any time unilaterally accelerate the elimination of customs duties set out in its Schedule in Annex 2A (Tariff Commitments) on originating goods of the other Party. The Party shall inform the other Party as early as practicable before the new rate of customs duty takes effect.
5. If the most-favoured-nation rate of customs duty applied by a Party ona particular good is lower than the rate of customs duty provided for in its Schedule in Annex 2A (Tariff Commitments), that Party shall apply the lower rate to the originating good of the other Party.
Article 2.4. National Treatment
Each Party shall accord national treatment to the goods of the other Party in accordance with Article Ill of GATT 1994, which is hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.5. Administrative Fees and Formalities
1. Each Party shall ensure, in accordance with Article VIll:1 of GATT 1994, that all fees and charges of whatever character (other than customs duties, charges equivalent to an internal tax or other internal charges applied consistently with Article IIl:2 of GATT 1994, and anti-dumping 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 shall require consular transactions, including any related fees and charges, in connection with the importation of any good of the other Party.
3. Each Party shall make publicly available on the internet a current list of the fees and charges it imposes in connection with importation or exportation.
Article 2.6. Customs Valuation
Each Party shall determine the customs value of goods traded between the Parties in accordance with Article VII of GATT 1994 and the Customs Valuation Agreement.
Article 2.7. Classification of Goods
The classification of goods traded between the Parties shall be in conformity with the Harmonized System.
Article 2.8. Import and Export Restrictions
Unless otherwise provided in this Agreement, neither Party shall adopt or maintain any prohibition or restriction on the importation of any good of the other Party or on the exportation or sale for export of any good destined for the territory of the other Party, except in accordance with Article Xl of GATT 1994, and to this end Article XI of GATT 1994, is incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.9. Application of Non-Tariff Measures
1. A Party shall not adopt or maintain any non-tariff measure on the importation of any good of the other Party or on the exportation of any good destined for the territory of the other Party, except in accordance with the WTO Agreement or this Agreement.
2. Each Party shall ensure the transparency of its non-tariff measures permitted in paragraph 1 and shall ensure that any such measures are not prepared, adopted or applied with the view to, or with the effect of, creating unnecessary obstacles to trade between the Parties.
Article 2.10. Publication and Administration of Trade Regulations
1. Each Party shall administer in a uniform, impartial and reasonable manner all its laws, regulations, decisions and rulings respecting any matter covered by this Chapter. To this end, Article X of GATT 1994 is incorporated into and made part of this Agreement, mutatis mutandis.
2. To the extent possible, each Party shall make its laws, regulations, decisions and rulings of the kind referred to in paragraph 1 publicly available on the internet.
Article 2.11. Agricultural Cooperation
The Parties shall undertake cooperation and capacity building activities in areas related to agriculture and agricultural trade for mutual benefit.
Article 2.12. Subcommittee on Trade In Goods
1. The Parties hereby establish a Subcommittee on Trade in Goods ("the Subcommittee on Goods") composed of government representatives of each Party.
2. The Subcommittee on Goods' functions shall include:
(a) reviewing and monitoring the implementation and operation of this Chapter;
(b) promoting trade in both agricultural and non-agricultural goods between the Parties, including through consultations on accelerating tariff elimination under this Agreement, and addressing non-tariff barriers to trade in goods between the Parties;
(c) addressing issues relating to the administration and operation of tariff rate quotas; and
(d) reporting on its activities and work programme to the Joint Committee.
3. The Subcommittee on Goods shall meet within one year of the date of entry into force of this Agreement and thereafter at such times as the Parties may agree. Meetings may occur in person, or by any other means as mutually determined by the Parties.
4. The Subcommittee on Goods may establish technical working groups to consider any matter relating to this Chapter that creates disruption or may affect trade in goods between the Parties. Any technical working group established shall report to the Subcommittee on Goods on the progress of its work.
Chapter 3. TRADE REMEDIES
Section A. Anti-dumping, Subsidies and Countervailing Measures
Article 3.1. Anti-Dumping Measures
Nothing in this Agreement affects the rights and obligations of the Parties under Article VI of GATT 1994 and the Anti-Dumping Agreement with regard to the application of anti-dumping measures.
Article 3.2. Subsidies and Countervailing Measures
Nothing in this Agreement affects the rights and obligations of the Parties under Article VI of GATT 1994 and the SCM Agreement with regard to the application of countervailing duty measures.
Article 3.3. Lesser Duty Rule
If a Party takes a decision to impose anti-dumping or countervailing duty, it may consider applying a duty less than the margin of dumping or the amount of the subsidy, as relevant, where such lesser duty would be adequate to remove the injury to the domestic industry in accordance with the Party's laws and regulations.
Section B. Global Safeguard Measures
Article 3.4. Global Safeguard Measures
Nothing in this Agreement affects the rights and obligations of the Parties under Article XIX of GATT 1994, the Safeguards Agreement and the Agreement on Agriculture.
Section C. Bilateral Safeguard Measures
Article 3.5. Definitions
For the purposes of this Section:
(a) customs duty reduction or elimination means any customs duty reduction or elimination in accordance with paragraph 2 of Article 2.3 (Elimination or Reduction of Customs Duties - Trade in Goods);
(b) domestic industry means, with respect to an imported good, the producers as a whole of the like or directly competitive good operating within the territory of a Party, or those whose collective output of the like or directly competitive good constitutes a major proportion of the total domestic production of the good;
(c) serious injury means a significant overall impairment in the position of a domestic industry;
(d) threat of serious injury means serious injury that is clearly imminent, in accordance with paragraph 1 of Article 3.7 (Conditions and Limitations). A determination of the existence of a threat of serious injury shall be based on facts and not merely on allegation, conjecture or remote possibility; and
(e) transition period means, in relation to a good, the period from the date of entry into force of this Agreement until fourteen (14) years after the date on which the elimination or reduction of the customs duty on that good is completed.
Article 3.6. Application of a Bilateral Safeguard Measure
1. If as a result of the reduction or elimination of a customs duty under this Agreement, an originating good of the other Party is being imported into the territory of a Party in such increased quantities, in absolute terms or relative to domestic production, and under such conditions as to be a cause of serious injury, or threat thereof, to a domestic industry producing a like or directly competitive good, the Party may during the transition period, apply one of the following bilateral safeguard measures:
(a) suspend the further reduction of any rate of customs duty on the good provided for under this Agreement; or
(b) increase the rate of customs duty on the good to a level not to exceed the lesser of:
(i) the most-favoured-nation applied rate of customs duty on the good in effect at the time the bilateral safeguard measure is applied; and
(ii) the most-favoured-nation applied rate of customs duty on the good in effect on the day immediately preceding the date of entry into force of this Agreement.
2. Neither Party shall apply or maintain a bilateral safeguard measure or provisional bilateral safeguard measure under this Chapter to any good imported under a tariff rate quota established by the Party under this Agreement.
Article 3.7. Conditions and Limitations
1. A Party may apply a bilateral safeguard measure only following an investigation by the Party's competent authorities in accordance with the procedures and requirements provided for in Articles 3 and 4.2 of the Safeguards Agreement, and to this end, Articles 3 and 4.2 of the Safeguards Agreement are incorporated into and made part of this Agreement, mutatis mutandis.
2. A Party shall notify the other Party immediately in writing upon it initiating an investigation described in paragraph 1 and shall provide adequate opportunity for prior consultations with the other Party in advance of applying a bilateral safeguard measure, with a view to reviewing the information arising from the investigation and exchanging views on the bilateral safeguard measure.
3. Each Party shall ensure that its competent authorities complete any such investigation within one year of the date of its initiation.
4. Neither Party shall apply or maintain a bilateral safeguard measure:
(a) except to the extent, and for such time, as may be necessary to prevent or remedy serious injury and to facilitate adjustment of the domestic industry;
(b) for a period exceeding two years, except that the period may be extended by up to one year if the competent authorities of the applying Party determine, in conformity with the procedures specified in this Article, that the bilateral safeguard measure continues to be necessary to prevent or remedy serious injury and to facilitate adjustment and that there is evidence that the industry is adjusting.
5. Regardless of its duration, any bilateral safeguard measure or provisional bilateral safeguard measure shall terminate at the end of the transition period.
6. No bilateral safeguard measure shall be applied again to the import of a good which has been previously subject to such a measure, for a period of time equal to that during which such measure was applied, or one year since the expiry of such measure, whichever is longer.
7. Notwithstanding the provisions of paragraph 6, a bilateral safeguard measure with a duration of 180 days or less may be applied again to the import of a good if:
(a) at least one year has elapsed since the date of introduction of a bilateral safeguard measure on the import of that good; and
(b) abilateral safeguard measure has not been applied on the same good more than twice in the five-year period immediately preceding the date of the first imposition of the bilateral safeguard measure.
8. A Party shall not apply a bilateral safeguard measure or provisional bilateral safeguard measure on a good that is subject to a global safeguard measure under Article XIX of GATT 1994 and the Safeguards Agreement. A Party shall not continue to maintain a bilateral safeguard measure or provisional bilateral safeguard measure on a good that becomes subject to a global safeguard measure.
9. In order to facilitate adjustment in a situation where the expected duration of a bilateral safeguard measure is more than one year, the Party that applies the measure shall progressively liberalise it at regular intervals during its period of application.
10. When a Party terminates a bilateral safeguard measure, the rate of customs duty shall be the rate that would have been in effect but for the bilateral safeguard measure, according to the Party's Schedule to Annex 2A (Tariff Commitments).
Article 3.8. Provisional Bilateral Safeguard Measure
1. In critical circumstances where delay would cause damage that would be difficult to repair, a Party may apply a provisional bilateral safeguard measure pursuant to a preliminary determination by its competent authorities that there is clear evidence that imports of an originating good from the other Party have increased as the result of the reduction or elimination of a customs duty under this Agreement, and have caused serious injury, or threat of serious injury, to its domestic industry.
2. Before applying a provisional bilateral safeguard measure the applying Party shall notify the other Party of the preliminary determination and shall immediately initiate consultations after applying the provisional bilateral safeguard measure.
3. The duration of any provisional bilateral safeguard measure shall not exceed 200 days, during which time the applying Party shall comply with the requirements of Article 3.6 (Application of a Bilateral Safeguard Measure) and Article 3.7 (Conditions and Limitations) and Article 3.9 (Compensation).
4. The applying Party shall promptly refund any duty collected as a result of a provisional bilateral safeguard measure if the investigation conducted does not result in a finding that the requirements of Article 3.6 (Application of a Bilateral Safeguard Measure) have been met. The duration of any provisional bilateral safeguard measure shall be counted as part of the period described in subparagraph 4(b) of Article 3.7 (Conditions and Limitations).