Australia's Free Trade Agreements (FTAs) provide businesses with opportunities to compete more effectively in international markets by reducing barriers to trade and improving market access.
FTAs can deliver a range of benefits, including:
However, these benefits are not automatic.
Tip 1: Businesses must actively claim FTA benefits and provide evidence that their goods or services meet the requirements of the relevant agreement.
Australia has FTAs with many of its major trading partners, and in some cases multiple agreements may apply to the same market.
Businesses should compare available agreements to determine which provides the greatest commercial advantage.
Tip 2: The best FTA is not always the newest one. Compare the available agreements to identify the most suitable option for your product, supply chain, and long-term business strategy.
To qualify for preferential tariff treatment under an FTA, products must meet the agreement's Rules of Origin.
Rules of Origin are used to determine whether a product can be considered "Australian" for the purposes of claiming FTA benefits.
The most common origin rules include:
Wholly Obtained Goods
Products that are entirely grown, raised, harvested, mined, or produced in Australia without imported inputs.
Examples include:
Product-Specific Rules
Most manufactured products qualify through product-specific rules that demonstrate a substantial transformation has occurred in Australia.
For example:
These requirements are assessed using the product's Harmonised System (HS) Code and the specific rule outlined in the relevant FTA.
Tip 3: Understand your supply chain and keep supporting records. Purchasing goods from an Australian supplier does not automatically mean the goods qualify as Australian under an FTA.
Regional Value Content (RVC)
Some products may qualify using a Regional Value Content (RVC) test, which measures the proportion of the product's value that originates within Australia or the FTA region.
Different FTAs and products have different RVC thresholds, typically ranging from 35% to 40%.
The Harmonised System (HS) Code is the international product classification system used by customs authorities worldwide. The correct HS Code is essential for determining applicable Rules of Origin, tariff preferences and import requirements.
Exporters are responsible for ensuring the correct classification of their goods. If you are unsure of your product's HS Code, you should seek advice from a qualified customs broker or the relevant customs authority.
Once you have identified the correct HS Code, selected the most suitable FTA, and confirmed that your product meets the relevant Rules of Origin, you must provide supporting documentation to substantiate your claim.
Depending on the agreement, this may include:
Document requirements vary between FTAs and destination markets.
Australian Industry Group can help exporters by providing:
For assistance with Free Trade Agreements, Rules of Origin or export documentation requirements, contact Australian Industry Group Export Documentation Team:
Email: tradedocs@australianindustrygroup.com.au
Phone: 1300 776 063
The Workplace Advice Line is Australian Industry Group’s national telephone advisory service for members’ on-the-spot workplace-related questions.
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