Article 18. Non-Application of Articles 15 and 16 to Matters Within the Scope of other Chapters
Articles 15 and 16 shall not apply to matters within the scope of Chapter 3 (Rules of Origin and Verification Procedures), Chapter 4 (Customs Procedures), Chapter 5 (Sanitary and Phytosanitary Measures) or Chapter 6 (Technical Regulations, Standards and Conformity Assessment Procedures).
Chapter 3. RULES OF ORIGIN AND VERIFICATION PROCEDURES
Section A. Rules of Origin
Article 1. Definitions
For the purposes of this Chapter:
aquaculture means the farming of aquatic organisms including fish, molluscs, crustaceans, other aquatic invertebrates and aquatic plants, from seedstock such as eggs, fry, fingerlings and larvae, by intervention in the rearing or growth processes to enhance production such as regular stocking, feeding, or protection from predators;
CIF value means the value of the good imported and includes the cost of insurance and freight up to the port or place of entry into the country of importation;
FOB means the free-on-board value of the good, inclusive of the cost of transport to the port or site of final shipment abroad;
generally accepted accounting principles means the recognised consensus or substantial authoritative support in 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;
identical and interchangeable goods or materials means goods or materials that are interchangeable for commercial purposes and whose properties are essentially identical;
indirect material means a good used in the production, testing or inspection of a good but not physically incorporated into the good, or a good used in the maintenance of buildings or the operation of equipment associated with the production of a good, including:
(a) fuel and energy;
(b) tools, dies and moulds;
(c) spare parts and materials used in the maintenance of equipment and buildings;
(d) lubricants, greases, compounding materials and other materials used in production
or used to operate equipment and buildings;
(e) gloves, glasses, footwear, clothing, safety equipment and supplies;
(f) equipment, devices and supplies used for testing or inspecting goods;
(g) catalysts and solvents; and
(h) any other goods 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;
material means any matter or substance that is used in the production of a good; non-originating good or non-originating material means a good or material that does not qualify as originating under this Chapter;
originating material means a material that qualifies as originating under this Chapter;
packing materials and containers for shipment means goods used to protect a good during its transportation, other than containers and packaging material used for retail sale;
preferential tariff treatment means the rate of customs duties applicable to an originating good of the exporting Party in accordance with Annex 2-A (Schedule of Commitments on Tariffs);
producer means a person who engages in the production of goods or materials;
production means methods of obtaining goods including but not limited to growing, mining, harvesting, farming, raising, breeding, extracting, gathering, collecting, capturing, fishing, trapping, hunting, manufacturing, aquaculture, processing or assembling a good; and
product specific rules are the rules set out in Annex 3-B.
Article 2. Originating Goods
For the purposes of this Chapter, a good shall be treated as an originating good if it:
(a) is wholly obtained or produced in a Party as defined in Article 3;
(b) is produced entirely in one or more of the Parties, by one or more producers, exclusively from originating materials, in accordance with this Chapter;
(c) satisfies all applicable requirements of Annex 3-B, as a result of processes performed entirely in the territory of one or more 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 3. Goods Wholly Obtained or Produced
For the purposes of Article 2, the following goods shall be considered as wholly obtained or produced:
(a) plants and plant goods, including fruit, flowers, vegetables, trees, seaweed, fungi and live plants, grown, harvested, picked or gathered in a Party; (1)
(b) live animals born and raised in one or more Parties;
(c) goods obtained from live animals in a Party;
(d) goods obtained from hunting, trapping, fishing, farming, aquaculture, gathering or capturing in a Party;
(e) minerals and other naturally occurring substances extracted or taken from the soil, waters, seabed or beneath the seabed in a Party;
(f) goods of sea-fishing and other marine goods taken from the high seas, in accordance with international law, (2) by any vessel registered or recorded with a Party and entitled to fly the flag of that Party;2
(g) goods produced from the goods referred to in subparagraph (f) on board any factory ship registered or recorded with a Party and entitled to fly the flag of that Party;
(h) goods taken by a Party, or a person of a Party, from the seabed or beneath the seabed beyond the Exclusive Economic Zone and adjacent Continental Shelf of that Party and beyond areas over which third parties exercise jurisdiction under exploitation rights granted in accordance with international law;
(i) goods which are:
(i) waste and scrap derived from production and or consumption in a Party provided that such goods are fit only for the recovery of raw materials; or
(ii) used goods collected in a Party provided that such goods are fit only for the recovery of raw materials; and
(j) goods produced or obtained in a Party solely from products referred to in subparagraphs (a) to (i) or from their derivatives.
Article 4. Calculation of Regional Value Content
1. For the purposes of Article 2, if Annex 3-B requires a good to meet a regional value requirement, the formula for calculating the regional value content will be:
RVC= V–VNM x100
V
where:
RVC is the regional value content of a good, expressed as a percentage;
V is the value of the good, as provided in paragraph 2; and
VNM is the value of non-originating materials, including materials of undetermined origin.
2. The value of the good referred to in paragraph 1 shall be, for exported goods, the FOB value of the good.
3. The value of non-originating materials or materials of undetermined origin referred to in paragraph 1 shall be:
(a) for imported materials, the CIF value at the time of importation of the materials; or
(b) for materials acquired within the territory of the Party in which the good is produced the earliest ascertainable price paid or payable for the materials in the territory of the Party.
4. The value of goods under this Chapter will be determined in accordance with the Agreement on Customs Valuation.
5. Each Party shall provide that, for a non-originating material or material of undetermined origin included under paragraph 1, the following expenses may be deducted from the value of the material:
(a) the costs of freight, insurance, packing and all other costs incurred in transporting the material within or between the Parties’ territories to the location of the producer;
(b) duties, taxes and customs brokerage fees on the material paid in the territories of one or more of the Parties, other than duties and taxes that are waived, refunded, refundable or otherwise recoverable, including credit against duty or tax paid or payable;
(c) the cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or by-product;
(d) the cost of processing incurred in the territory of one or more of the Parties in the production of the non-originating material; and
(e) the cost of originating materials used or consumed in the production of the non- originating material in the territory of one or more of the Parties.
6. If the cost or expense of a deduction listed in paragraph 5 is unknown or documentary evidence of the amount of the deduction is not available, then no deduction is allowable for that particular cost.
7. For the purposes of this Chapter, all costs shall be recorded and maintained in accordance with the generally accepted accounting principles applicable in the territory of the Party in which the good is produced or manufactured.
Article 5. Cumulative Rules of Origin
1. A good is originating if the good is produced in one or more of the Parties by one or more producers, provided that the good satisfies the requirements in Article 2 and all other applicable requirements in this Chapter.
2. Originating goods or materials of any of the Parties used in the production of a good in another Party shall be considered to originate in the latter Party.
3. Production that occurs in the territory of one or more of the Parties by one or more producers may count as originating content in the origin determination of a good regardless of whether that production was sufficient to confer originating status to the materials themselves.
Article 6. Minimal Operations and Processes
If a claim for origin is based on a regional value content, the operations or processes listed below, when undertaken by themselves or in combination with each other, are considered to be minimal and shall not be taken into account in determining whether or not a good is originating:
(a) operations to ensure preservation of goods in good condition for the purposes of transport or storage;
(b) facilitating shipment or transportation;
(c) packaging or presenting goods for sale;
(d) affixing of marks, labels or other like distinguishing signs on products or their packaging; and
(e) disassembly.
Article 7. De Minimis
1. A good that does not satisfy a change in tariff classification requirement pursuant to
Annex 3-B will nonetheless be an originating good if:
(a) the value of all non-originating materials used in the production of the good that did not undergo the required change in tariff classification does not exceed 10 per cent of the FOB value of the good; or alternatively
(b) for a textiles or apparel good provided for in Chapters 50 to 63 of the Harmonized System, the weight of all non-originating materials used in its production that did not undergo the required change in tariff classification does not exceed 10 per cent of the total weight of the good.
2. The goods under paragraph 1 must meet all other applicable requirements of this Chapter.
3. 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 8. Accessories, Spare Parts, Tools and Instructional or other Information Materials
1. For the purposes of determining origin, accessories, spare parts, tools or instructional or other information materials provided 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 goods undergo the applicable change in tariff classification or production process requirements.
2. If the good is subject to a regional value content requirement, the value of the accessories, spare parts, tools or instructional or other information materials provided with the good 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.
3. Paragraphs 1 and 2 shall only apply if:
(a) the accessories, spare parts, tools or instructional or other information materials are not invoiced separately from the good; and
(b) the quantities and the value of those accessories, spare parts, tools or instructional or other information materials provided with the good are customary for that good.
4. If accessories, spare parts, tools and instructional or other information materials presented with the good are not customary for the good or are invoiced separately from the good, they shall be treated as separate goods for the purpose of determining origin.
Article 9. Identical and Interchangeable Goods or Materials
The determination of whether identical and interchangeable goods or materials are originating goods shall be made either:
(a) by physical segregation of each of the goods or materials; or
(b) by 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, provided that the inventory management method selected is used throughout the fiscal year of the person that selected the inventory management method.
Article 10. Treatment of Packing Materials and Containers
1. Packing materials and containers in which a good is placed exclusively for transportation and shipment shall not be taken into account in determining the origin of any good.
2. Packing 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 process of production requirements for the good as set out in Annex 3-B.
3. If a good is subject to a regional value content requirement, the value of the packing materials and containers 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. If the packaging material and container is not customary for the good, its value shall not be included as originating in a regional value content calculation for the good.
Article 11. Indirect Materials
An indirect material shall be treated as an originating material without regard to where it is produced. The value of such a good shall be the cost registered in the accounting records of the producer of the good.
Article 12. Retention of Records
1. In accordance with its domestic laws and regulations, each Party shall require, that:
(a) a producer, exporter, or authorised representative of the producer or exporter shall maintain all records relating to the origin of a good for which preferential tariff treatment is claimed in an importing Party, including the Declaration of Origin relevant to the good, or a copy thereof, for five years from the date of the exportation; and
(b) an importer claiming preferential tariff treatment shall maintain all records relating to the importation of the good, including the Declaration of Origin relevant to the good (completed pursuant to Article 15), or a copy thereof, for five years after the date of importation.
2. The records to be maintained pursuant to this Article include electronic records.
Article 13. Consignment
1. Goods directly transported among the Parties will retain their originating status under Article 2.
2. A good shall retain its originating status under Article 2 if it has been transported through a non-party provided that the good has not undergone subsequent production or any other operation in the territory of a non-party other than:
(a) unloading, reloading, storing, any other operation necessary to preserve the goods in good condition, repacking, relabelling or any other operation necessary to transport the goods to the territory of the importing Party; or
(b) if the goods have been shown in or utilised at an exhibition in a non-party.
Article 14. Goods In Storage
The Customs Administration of the importing Party shall grant preferential tariff treatment for an originating good of the exporting Party which, on the date of entry into force of this Agreement, is:
(a) in the process of being transported from the exporting Party; or
(b) has not been released from Customs control; or
(c) is in storage in a warehouse regulated by the Customs Administration of the importing Party;
provided that the good is destined for home consumption in the importing Party and satisfies all the applicable requirements of this Chapter.
Section B. Origin Procedures
Article 15. Declaration of Origin
1. A claim that goods are eligible for preferential tariff treatment shall be supported by a Declaration of Origin completed by the exporter or producer or an authorised representative of the exporter or producer.
2. The Declaration of Origin shall:
(a) contain the information detailed in Annex 3-A;
(b) be made in respect of one or more goods and may include a variety of goods;
(c) be completed in English;
(d) be in a written format, including electronic format; and
(e) be an original, except that copies may be made for subsequent transactions.
3. The Declaration of Origin may be made on the invoice for the goods or on a separate
document, including on a company’s letterhead.
4. Neither erasures nor superimposition shall be allowed on the Declaration of Origin. Any alteration shall be made by striking out the erroneous information and making any addition required. Such alteration shall be approved by the exporter or producer making the declaration. To the extent possible, unused spaces on the form shall be crossed out. If the Declaration of Origin is more than one page long, subsequent pages shall be numbered in sequence. For example, a three page document shall be numbered as 1 of 3, 2 of 3 and 3 of 3.
5. A Declaration of Origin shall remain valid for two years after the date on which the Declaration of Origin was signed.
6. Nothing in this Agreement shall prevent a producer or exporter from obtaining the services of a third party to assist them to complete the Declaration of Origin.
Article 16. Submission of Declaration of Origin
Except as otherwise provided in this Chapter, the original Declaration of Origin or a copy shall be submitted to the Customs Administration of the importing Party when requested by that Customs Administration.
Article 17. Circumstances When Declaration Not Required
1. In accordance with its domestic laws and regulations, the importing Party shall not require a Declaration of Origin in order to claim preferential tariff treatment for:
(a) goods for which the customs value does not exceed US$200 FOB or the equivalent amount in the importing Party’s currency, or such higher amount as it may establish; or
(b) any good for which a Party has waived the requirement for a Declaration of Origin,
provided that the importation does not form part of one or more importations that may reasonably be considered to have been undertaken or arranged for the purpose of avoiding the submission of the Declaration of Origin.
2. Notwithstanding Article 15, the importing Party may elect to waive the requirement for a Declaration of Origin or any of the requirements in Section B.
Article 18. Claim for Preferential Tariff Treatment
1. Subject to Article 22, the importing Party shall grant preferential tariff treatment to a good imported into its territory from any other Party, provided that:
(a) the good is an originating good under Article 2;
(b) the consignment criteria outlined in Article 13 have been met; and