Only goods that originate in either China or Australia enjoy preferential tariff rates. ChAFTA preferential rules of origin are agreed criteria used to ensure that this is the case. These criteria are required to prevent trans-shipment, where goods from a third party are redirected through either China or Australia to avoid paying higher tariffs. Any imports into China or Australia that do not comply with the rules set out in Chapter 3 and Annex 2 of the agreement will be subject to the general rate of duty applied in Australia or China instead of the preferential tariff rates available under ChAFTA.
For Australian exporters, in general, goods which are 'originating' under ChAFTA and eligible for ChAFTA Certificate of Origin are:
• wholly obtained, or produced from wholly obtained, goods entirely in Australia (or Australia and China); or
• produced entirely in Australia (or Australia and China), from materials classified as 'originating' under the rules of origin; or
• produced in Australia (or Australia and China) using inputs from other countries, and meets the Product Specific Rules (PSRs) applicable to that good.
For further information please refer to Department of Foreign Affairs and Trade website.