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New CER Rules of Origin were agreed with Australia in 2006. The rules will enter into effect on 1 January 2007.
Rules of Origin are the rules that determine whether or not a good qualifies for preferential entry into Australia or New Zealand under CER. If traded goods meet the criteria under the rules of origin, they can enter duty-free.
The new rules are largely based on satisfying a ‘change in tariff classification’, or CTC, rather than the previous 50 percent ‘regional value content’ threshold.
The new CTC approach means that for the majority of tariff lines, an exporter need simply satisfy the condition that there has been a change in tariff classification between any imported inputs from third countries and the completed good that is being exported to Australia/New Zealand. This shifts the focus from the origin of inputs, and gives manufacturers a greater choice of materials. This will help increase efficiency and competitiveness. The rules also significantly reduce the need to keep financial cost records to support rules of origin claims.
Under the agreement exporters will have the option of using existing rules until 2012.
For more information, and the new draft schedule of rules please contact the Ministry of Economic Development.
