IV.

ASEAN and Its Free Trade Area Partners

A. ASEAN-Australia-New Zealand Free Trade Area

1. The ASEAN- Australia-New Zealand Free Trade Area (AANZFTA) is a trade

agreement among the ten (10) AMSs, Australia and New Zealand. The Agreement was
signed on February 27, 2009 and entered into force on January 1, 2010.

The AANZFTA is a comprehensive single undertaking FTA covering trade in goods, trade in
services, and investment. It also includes chapters on:
(i) rules of origin;
(ii) customs procedures;
(iii) sanitary and phytosanitary measures;
(iv) standards, technical regulations and conformity assessment procedures; and
(v) safeguard measures.

2. OBJECTIVES of AANZTA:
The AANZFTA seeks to establish deeper economic integration between the two regions through
(i) progressive liberalization and facilitation of trade in goods, trade in services, and
investments, and
(ii) trade and investment facilitation and economic cooperation measures.

3. Product Coverage of the Trade in Goods (TIG) Chapter of the AANZFTA:

-Except for rice, sugar and selected articles of iron and steel, all products falling under HS
Chapters 1 to 97 are covered in the TIG Chapter.

4.
2 Programs of Tariff Reduction under the AANZFTA TIG Chapter:
a. NORMAL TRACK (NT) – products included in NT comprise 90% of total tariff lines.
The tariff reduction program was set to commence on January 1, 2008 and by 2015, all
products under NT are expected to be duty-free.

b. SENSITIVE TRACK (ST) – contains the remaining ten percent (10%) of total tariff
lines. It is subdivided into 2 categories: Sensitive List (SL) and Highly Sensitive List
(HSL). Products falling under the SL Category have end rates of 0% - 5% by 2015, 2018,
or 2020 while tariffs of products in the HSL shall be reduced by 20%, from their base
rates, by 2020.
 5.
RULES OF ORIGIN (ROO) UNDER AANZFTA
Products which are wholly produced or obtained in the exporting Party, or produced in
the exporting Party exclusively from originating materials from one or more of the Parties, shall
be deemed originating and eligible for preferential tariff treatment.
The “General Rule” of RVC 40 or all non-originating materials used in the production of
the good have undergone a change in tariff classification at the four-digit level (i.e., change in
tariff heading or CTH) is applicable to all other goods except where there is a Product Specific
Rule (PSR). The PSR becomes either the exclusive rule, or an alternative to, or in combination
with the General Rule, depending on the provisions of Annex 2 of the Agreement.

Table 18. RULES OF ORIGIN (ROO) UNDER AANZFTA

1. ROO Criteria-General Rule RVC 40 or Change in Tariff Heading
2. Certificate of Origin (CO) Form Form AANZ
3. Reciprocity Rule None

6. Products to be Eligible for concession under AANZFTA

-Product should be in the Inclusion List;
-Product should be wholly produced or obtained in the exporting party, or meets the RVC
40 or CTH or PSR criterion, to be deemed in the originating; and
-Submission of CO Form AANZ
7. EOs implement the Philippines’ tariff commitments under AANZFTA
-EO 851 issued on December 23, 2009 and which took effect on January 1, 2010.
-EO 191 issued on November 5, 2015 and which took effect on November 12, 2015.

B. ASEAN-CHINA FREE TRADE AREA

9. ASEAN-China Free Trade Area (ACFTA) – is a trade agreement among the ten (10) AMSs
and China.
The Framework Agreement on Comprehensive Economic Cooperation between ASEAN
and China covering trade in goods, trade in services, investments and other measures to develop
new areas of economic cooperation was signed in Cambodia on November 4, 2002.
The Agreement on Trade in Goods (TIG) containing the Parties’ commitment to establish
the ACFTA covering Trade in goods by 2020 for ASEANn-6 and China and by 2015 for CLMV
was signed on November 29, 2004.
10. OBJECTIVES of ACFTA:
-To strengthen and enhance economic, trade and investment co-operation between the
Parties.
-To progressively liberalize and promote trade in goods and services as well as create a
transparent, liberal and facilitative investment regime
-To explore new areas and develop appropriate measures for closer economic co-
operation between the Parties
-To facilitate the more effective economic integration of the newer AMSs and bridge the
development gap among the Parties

11. ACFTA Early Harvest Programme and its Product Coverage

The Early Harvest Program (EHP) aims to accelerate the implementation of Article 6 of
the Framework Agreement on trade in goods.
The EHP covers all products falling under HS Chapters 1 to 8 (live animals, meat and
edible meat offal, fish, dairy produce, other animal products, live trees, edible vegetables, and
edible fruits and nuts). Parties were allowed to have an Exclusion List.