The AANZFTA is a comprehensive and single-undertaking economic agreement that opens up and creates new opportunities for the 600 million peoples of ASEAN, Australia and New Zealand which have a combined economic output of USD 2.65 trillion via a platform of a more liberal, facilitative and transparent market access and investment regimes among the signatories to the Agreement.
Through the AANZFTA:
- tariffs will be progressively reduced from entry into force of the Agreement, and eliminated for at least 90 percent of all tariff lines within specified timelines;
- movement of goods will be facilitated via a more modern and flexible rules of origin, simplified customs procedures and more transparent mechanisms;
- barriers to trade in services will be progressively liberalized allowing for greater market access to service suppliers in the region;
- movement of business persons, those engaged in trade and investment activities, will be facilitated; and
- covered investments will be accorded a range of protection, including the possibility of dealing with disputes via an investor-state dispute settlement mechanism. Find out more… -> ASEAN, Australia, New Zealand
The AANZFTA is an agreement of twelve Party states, among ASEAN Member States and CER countries. They are composed of the ten ASEAN Member States namely: Brunei Darussalam, Cambodia, Lao PDR, Indonesia, Malaysia, Myanmar, The Philippines, Singapore, Thailand and Viet Nam; and the CER countries of Australia and New Zealand.
Date of Signing
The Economic Ministers of ASEAN, and the Trade Ministers of Australia and New Zealand signed the AANZFTA on 27 February 2009 in Cha-am, Phetchaburi, Thailand.
Entry into Force
The AANZFTA entered into force on 1 January 2010 following notification of completion of internal requirements including ratification from eight (8) of the Parties:
- six (6) ASEAN Member States namely Brunei Darussalam, Malaysia, Myanmar, The Philippines, Singapore, Viet Nam; and
- Australia and New Zealand.
Subsequently, on 12 March 2010, the AANZFTA entered into force for Thailand following its notification on 12 January 2010.
AANZFTA has entered into force in Cambodia and Lao PDR on 4 January 2011 and 1 January 2011, respectively.
Indonesia has entered into force on 10 January 2012, making all Parties on board in AANZFTA.
The FTA Joint Committee was established to oversee the implementation of the AANZFTA. The FTA Joint Committee is composed of representatives from all the twelve Parties. It is co-chaired by Brunei Darussalam for ASEAN, Australia and New Zealand.
The AANZFTA covers commitments and obligations on:
- Trade in Goods including Rules of Origin and Customs Procedures
- Standards and Sanitary and Phytosanitary Measures
- Trade in Services
- Movement of Natural/Business Persons
- Electronic Commerce
- Intellectual Property
The AANZFTA has an economic cooperation component to support the implementation of the Agreement at the regional and country levels.
Key Outcomes for ASEAN
- ASEAN will gain from increased market access via progressive tariff reduction and elimination.
- ASEAN will enjoy zero tariffs at entry into force of the Agreement in 2010 for 96.5 percent, and 84.7 percent of Australia and New Zealand’s tariff lines.
- ASEAN will continue to enjoy further tariff reduction during transition until final tariff elimination for all tariff lines of Australia and New Zealand is achieved in 2020.
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- ASEAN will benefit from a more flexible and trade facilitating rules of origin with the “co-equal” rule for 83% of tariff subheadings, and allowing regional cumulation for calculating the eligibility for preferential tariff treatment.
- Application of the rules of origin are further enhanced by the “advance ruling in writing” provisions in the Chapter on Customs Procedures as regards “tariff classification, question arising from the application of the principles in the WTO Agreement on Customs Valuation and/or origin of goods” which Parties agreed to adopt, subject to their domestic laws and regulations. The advance ruling provision would help shorten the time for checking and assessing goods at the ports of entry, thus, helping speed up the release of goods.
- ASEAN will benefit from improved market access and national treatment for trade in services. Australia and New Zealand’s commitments in trade in services have gone beyond their commitments in the WTO.
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- ASEAN will benefit from significant protection measures for covered investments including provision of an investor-state dispute settlement mechanism.
- ASEAN will gain from the inclusion of provisions that will facilitate the temporary movement of business persons such as business visitors, installers and services, executives of a business, intra-corporate transferees, or contractual contract service suppliers.