Taking Advantage of ASEAN’s FTAs
Besides the bilateral Free Trade Agreements (FTAs) that they have individually signed with other countries, each ASEAN member state is a signatory to the ASEAN Free Trade Area (AFTA) between themselves as well as the several FTAs that the regional trade bloc has signed with some of the major economies in the Asia-Pacific region. These include the ASEAN-Australia-New Zealand FTA (AANZFTA), the ASEAN-China FTA (ACFTA), the ASEAN-India FTA (AIFTA), the ASEAN-Korea FTA (AKFTA), the ASEAN-Japan Comprehensive Economic Partnership (AJCEP), and the ASEAN-Hong Kong, China FTA (AHKFTA).
These FTAs offer a great opportunity for exporters and importers to trade regionally as well as internationally without tariff barriers.
- Wholly-obtained or produced entirely in an FTA member country; or
- Must have undergone a ‘substantial transformation’ in an FTA member country.
For the goods that are partially produced within an FTA member country, substantial transformation guarantees that a meaningful manufacturing process has taken place in the free trade area for the good to qualify as originating.
Certificate of Origin
Essentially, for different FTAs, different RoO systems and requirements exist in terms of the methods used to determine the origin of the good. In all cases, regardless of the substantive criteria used for meeting the origin requirement, exporters belonging to a FTA member country must obtain a relevant certificate of origin (CO) for each shipment; verifying the origin of the product to take advantage of the tariff concessions available under the FTA and gain greater market access.
This article is an excerpt from the December 2018 issue of ASEAN Briefing magazine, titled “Export and Import Procedures in ASEAN: Best Practices“. In this issue, we highlight the region’s export and import procedures for the benefit of trading businesses. We begin by outlining the export procedures in each ASEAN member state. Next, we focus on import procedures in each ASEAN country. Finally, we discuss the importance of meeting the region’s Rules of Origin (RoO) criteria for exporters and importers looking to take advantage of the individual ASEAN member states’ FTAs as well as the bloc’s regional FTAs.
ASEAN Briefing is produced by Dezan Shira & Associates. The firm assists foreign investors throughout Asia from offices across the world, including in Singapore, Hanoi, Ho Chi Minh City, and Jakarta. Readers may write firstname.lastname@example.org for more support on doing business in ASEAN.