Thailand-Australia Free Trade Agreement or TAFTA offers great privileges for Australian Exporters to do business in Thailand. Although there are few obligations, yet, TAFTA eases the process of import-export in Thailand for Australians. This article will guide you through the process of availing these benefits of TAFTA. This creates a great opportunity for Australian Exporters to start a business in Thailand as well.
To qualify for TAFTA preferential pricing, your export goods must meet a few prerequisites. It is advised that Australian Exporters in Thailand take the following actions in order to comply with the requirements:
- Obtain an AHECC Code for your Product
- Check the applicable TAFTA Preferential Rate
- Determine the Rule of Origin Applying to your Product
- Register as an Exporter
- Obtain a TAFTA Certificate of Origin
How to Obtain an AHECC Code for your Product?
Find the Australian Harmonized Export Commodity Classification (AHECC) code for the particular product you are selling.
An eight-digit number or the AHECC code categorizes products for export. The latter two numbers are unique to Australian exports, but the first six are part of a global standard (the “Harmonized System”). You must choose the correct code when classifying your goods because there are more than 5000 AHECC codes available.
Additionally, you can get the support in classification of products for export from the Australian Customs Service. Fill the Customs advice request proforma (PDF). Henceforth, email it to [email protected] to use the new AHECC Hotline and Electronic Advisory Service. Alternatively, fax or mail a proforma by calling the Customs Information Centre (CIC) at 1300 363 263.
How to Check the Applicable TAFTA Preferential Rate?
When you have an AHECC code, you can check the Thai Tariff Schedule to discover how the Agreement will affect your goods. You can find the AHECC product numbers in the “Heading” and “Subheading” columns.
The Thai Tariff Schedule often only contains six or seven digits, so keep that in mind. The first six digits of your AHECC must match the first six digits of the Thai tariff schedule because the Harmonized System tariff classes only share six numbers in common. If the Thai classification is divided further, you will need to figure out which classification corresponds to your products in order to calculate the appropriate tariff rate.
Determine the Rule of Origin Applying to your Product
Rules of origin are mandatory to prevent transhipment of commodities from markets other than Australia or Thailand from attempting to claim TAFTA preference and to give objective criteria for deciding whether or not goods qualify for preferential rates of tariff. Visit the Australian Customs and Border Protection Service TAFTA website for more details on the regulations of origin.
Wholly Obtained Goods in Australia
You must write the initials “WO” (wholly obtained) in the Origin Criterion column of the Certificate of Origin if your commodities were totally created in Australia from Australian goods, such as those that were cultivated, fished, or mined entirely in Australia. To know more about this process, continue reading Step 5 in this article.
Not Wholly Obtained Goods in Australia
Check the precise rule of origin criteria for your goods under TAFTA whose sourcing was not completely in Australia. TAFTA Annex 4.1 contains a complete list of the rules applicable to individual TAFTA products (Zip file)
Indicate “NA” in the Origin Criterion column for any items on your Certificate that do not adhere to TAFTA’s rules of origin.
You must mark the Certificate of Origin with the letters “PS” (product specific) in the “Origin Criterion” field of the Certificate form for goods that need to adhere to the product-specific regulations.
How to Register as an Exporter?
You can now register as an exporter of that product after determining the preferential tariff rate for your particular product and after verifying that it complies with the rules of origin. In order to export goods to Thailand under TAFTA, you must register those commodities. For instance, if you export auto parts, each part of which you export must be registered as an export (each will have its own AHECC code). To ensure that goods exported to Thailand and eligible for TAFTA preferential duty rates comply with the rules of origin, this is necessary.
However, unless the nature of your products materially changes after registration, you only need to register as an exporter once. The authorized authority that registered you will periodically examine your registration status.
How to Obtain a TAFTA Certificate of Origin?
TAFTA stipulates that in order for products to qualify for a tariff preference, they must be accompanied with a Certificate of Origin attesting to their compliance with the requirements for origin. Please be aware that each shipment of products eligible for a preference must have a unique, current Certificate of Origin. A copy of each Certificate must be sent by exporters to the Thai importer.
Exporters must be truthful when completing paperwork and properly classify their commodities in order to avoid penalties and delays.
That was what you must do in Australia. In case you face any problem after reaching out to Thailand, we can help you further in legal terms. Our service ranges from Company Registration in Thailand up to the Payroll Management. We also specialize in export-import licensing in Thailand. Write your enquiry to us at [email protected].
