Problems relating to Trade and Investment on ASEAN

Problems relating to Trade and Investment on ASEAN

9. Restrictive export/import trade, duty, and customs clearance
Issue	Issue details	Requests	Reference

(1) Disallowed Use of 3rd Country Invoice Scheme under the Self- Origin Certification Scheme	- Third country invoice gets rejected in Thailand, etc. under the pilot project of self-certification of origin prepared by the ASEAN authorised exporters in denial of the benefits under ATIGA.	- It is requested that the ASEAN member states accept the active use of the self-certification in regard to invoices issued in any of the ASEAN member states third countries.	- ASEAN Trade in Goods Agreement(ATIGA)
	(Action) - On 1 January 2011, "Second Protocol to Amend the Agreement on Trade in Goods of the Framework Agreement on Comprehensive Economic Co-Operation between ASEAN and PRC" entered into force. The purpose of the Protocol is to update the operational certification procedures for the rules of origin under ACFTA. The substance of the amendments are as follows: (1) The definition of the issuing authority of Form E has been amended to include other institution authorized under the domestic laws of the member state, regulations and administrative rules of a party to issue a certificate of origin (Form E), in addition to "any government authority of the exporting country". (2) Incorporation of a provision directing the customs authority of the importing Party in all ASEAN+1 FTA to accept a certificate of origin (Form E) issued in a third country. (3) Approval of the use of Movement Certificate (MC), normally called "back-to-back Form E". (4) Provision for acceptance of verification visits to the exporting party to confirm if the products do originate from the exporting country. (5) Provision changing the issuance of Form E to "prior to or at the time of shipment or within three (3) days from the date of shipment". (6) Extension of Form E validity to one (1) year, and extension of the compulsory retention period to more than three (3)-years for the documents related to the Form E issuance. - In the 2nd pilot project of self-certification of origin prepared by the ASEAN authorised/certified exporters (ACEs) in which Indonesia, the Philippines, Laos, Vietnam and Chile participate prescribes that (1) only manufacturers are entitled to ACEs, (2) description of country of origin declaration is restricted to commercial Invoice only, (3) maximum 3-persons my sign the documents. - On 10 December 2013, Ministry of Trade selected the first 15 export enterprises that participate in the experimental introduction of 2nd Pilot Project of ASEAN self-certification of origin under ASEAN Trade In Goods Agreement (ATIGS). - On 9 January 2014, Indonesia, Laos and the Philippines completed the respective domestic procedures for implementation of the 2nd pilot project of self-certification of origin. - Since 5 October 2015, Government of Vietnam (GOV) has implemented the 2nd Pilot Project of ASEAN Self-Certification of Origin, provided, however, that GOV disallows the Third Country Invoice (Re-invoicing).
	(Improvement) - On 28 February 2015, Thai Customs promulgated notification, effective 1 March 2014, approving the interpretation of "Third Country Invoice" under ASEAN-PRC FTA (ACFTA), enabling application of third country invoice involving more than 2-plural third parties/countries. ("Third country invoicing can involve more than one invoicing party or country in the process. In other words, the term "third country" can refer to any number of countries other than the two countries directly involved in the process.")

(2) Delayed Implementation of Self-Certification of Origin	- Under the ASEAN self-certification system by authorised exporters, the 1st pilot project is now under way in Singapore, Malaysia, Brunei and Thailand benefiting all. However, there have been delays in participation by other member states. Moreover another system under different rules is about to be implemented.	- It is requested that the rest of the ASEAN Member States expedites implementation of the self-certification system under the 1st Pilot Project.	- ASEAN Trade in Goods Agreement(ATIGA)
	(Action) - On 25 August 2010, at the Meeting of ASEAN Economic Ministers and Related Meetings, it was agreed to execute the pilot project for introduction of self-certification system (SCS), with the year 2012 being set as the target year for its introduction. SCS has been introduced since November 2011 in Singapore, Malaysia and Brunei. - Since 1 October 2011, Thai Customs has participated in the SCS pilot project under ATIGA. - JETRO Business News [Tsusho Koho] of 3 October 2011 reported Thai Customs' announcement of its participation in the pilot project for self-certification scheme under ATIGA, accepting the invoice customs declaration under the preferential tariff rates, effective from 1 October 2011. However, according to JETRO's enquiry to the Foreign Trade Department of the Ministry of Commerce, its implementation from 1 October has de facto become impossible due to the procedural difficulties, requiring formal notification given to participating countries with request for provision of information on the registered authorised exporters through the ASEAN Secretariat. - On 30 August 2012, Brunei, Malaysia, Singapore and Thailand agreed on the extension of the 1st stage pilot system for the self-certification of origin scheme under ATIGA at the 44th ASEAN Economic Ministers (AEM)-ASEAN Free Trade Council (AFTA) Conference. - The 2nd Pilot Project for Self-certification System came into forth on 10 May 2013, with participation of Indonesia, the Philippines and Laos. Its actual implementation begins in the third-quarters. Vietnam will join the second pilot project. Thai will also join the 2nd pilot project, consecutively, after its participation in the 1st pilot project. - On 24 February 2015, Protocol 7 (ASEAN Customs Transit System: ACTS) of the ASEAN Framework Agreement on the Facilitation of Goods in Transit (AFAGIT) was concluded. Accordingly, Thai Customs, together with its counterparts in Malaysia and Singapore will aim at executing ACTS Pilot-Phase (Trial Run) by October 2015. - From 5 October 2015, GOV will run the 2nd Pilot Project of ASEAN Self-Certification Scheme, passing over the Onus of Country of Origin from the Administration to Authorised Exporter satisfying the Authorization Requirements. - On 17 October 2015, Thai Department of Foreign Trade executed with Cambodia the 1st Pilot Project of ASEAN Self-Certification Scheme (Exporter's side), retroactive to 1 August 2015).

(3) Problems on Delayed Issuance of Certificate of Origin	- Due to the short sailing time within the ASEAN member states, Form D preparation cannot catch up with the boat arrival from time to time.	- It is requested that ASEAN accepts pre-shipment issuance of Form D at port of embarkation.	- ASEAN Trade in Goods Agreement(ATIGA)
	(Action) - Master Plan on ASEAN Connectivity (MPAC), with the view to reinforce institutional connectivity, envisages smoothing the processing of origin certificate that includes electronic processing by 2012, and by 2015, aligning the domestic procedures.

(4) Problems from Showing Invoice Price On Origin Certificate	- Gaps exist between the issuing institution and the customs at the importing port on the price to be described in Form D, ex-factory or invoice price. From the business point of view, the price description on Form D is best dispensed with.	- It is requested that ASEAN repeals the invoice price description requirement on Form D.	- ASEAN Trade in Goods Agreement(ATIGA)
	(Improvement) - The 25th AFTA Council approved removal of the FOB value disclosure requirement from Form D under the ASEAN Trade in Goods Agreement (ATIGA) as to ASEAN-Japan EPA (AJCEP), ASEAN Korea FTA (AKFTA), and ASEAN-Australia-NZ FTA (AANZ). When wholly obtained (WO), change in tariff classification (CTC), or specific process as origin determination criteria is applied to these FTAs, there is no longer a requirement to fill the FOB value in the Form D. On 18 August 2013, the 45th ASEAN Economic Ministers' Meeting (AEM) approved the revised ATIGA Operational Certification Procedures (OCP) that incorporate removal of the FOB. Value disclosure requirement on Form D. Revised OCP became effective from 1 January 2014. - Under "ASEAN + 1" FTA, inclusive of Japan/ASEAN EPA, the F.O.B. Price Disclosure Requirement has been repealed, excepting the case, where the Value-Added Criteria apply. - On 20 March 2014, at the 9th Rules of Origin Subcommittee under Japan-ASEAN Comprehensive Economic Partnership (AJCEP) convened in Myanmar, the AJCEP member states agreed on the amended origin rule form (Form AJ), dispensing with the requirement for filling in FOB prices on certificate of origin documents, excluding the case where regional value content (RVC) or value added criteria is used, (and made effective from 1 October 2014). The revised Form in concern will apply after the 6-months transitional period from 1 October 2014, provided, however, that as to Myanmar and Malaysia, the former practice will continue for two years so that description of FOB prices is necessary. -- Japan Ministry of foreign affairs (http://www.mofa.go.jp/mofaj/ecm/ep/page22_001081.html) - Thai Department of Foreign Trade promulgated implementing rules for issuing revised "Form AJ" for ASEAN side origin certificate under Japan-ASEAN Comprehensive Economic Partnership (AJCEP). Excepting the case where Regional Value Content (RVC) standard is used for proof of origin, it has obviated the need for disclosure of the FOB price. (Enforced from 1 October 2014). - Ministry of Finance promulgated decree concerning order for amending the ASEAN side origin certificate "Form AJ" under Japan-ASEAN Comprehensive Economic Partnership (AJCEP), pursuant to Customs Act 1967 (Enforced from 1 October 2014). (http://www.federalgazette.agc.gov.my/outputp/pua_20141001_P.U.%20(A)%20266_PERINTAH%20DUTI%20KASTAM%20(ASEAN-JEPUN)%202014.pdf) - On 1 April 2016, Singapore Customs enforced the 1st Revised Protocol for ASEAN-Australia/New Zealand FTA (AANZFTA). The Protocol, among other measures, includes: 1) Amendment of Certificate of Origin "Form AANZ" pursuant to AANZFTA, 2) Repeal of Mandatory F.O.B. Price Description in Box 9 of Form AANZ, 3) Amended Product Specific Rules of Origin (PSR), shifting to HS 2012, etc.

(5) Delayed TPP Negotiation	- While the TPP (Transpacific Partnership Agreement) negotiation continues, its conclusion lags behind the target schedule.
	(Improvement) - Agreement on TPP Negotiation lagged behind the target schedules for several times including the March 2015 target. Following the enactment of TPA in the U.S., at long last, on 5 October 2015, the participating countries reached TPP Agreement in principle on 5 October 2015, and on 4 February 2016, all 12-countries signed the TPP Agreement.

(6) Differences of Import Procedures by Country on Government Designated Products	- It is a matter of concern that import procedures may vary the legislation of individual Member States, for example, on Parts And Materials and Chemical Goods.	- It is requested that the Member States will prepare ready-to-use information and review thereof through the Common Platform of the Asia Pacific countries.	- Nil
	(Improvement) - On 28 April 2014, Ministry of Economy, Trade and Industry (METI), by activating the framework under ASEAN Economic Ministers (AEM)-MITI Japan Economic and Industrial Cooperation Committee (AMEICC), developed Japan-ASEAN Chemical Substance Control Data Base. National Institute of Technology and Evaluation (NITE) started its full-fledged operation. The Data Base includes Chemical Regulatory Information among Japan and ASEAN Member States, Toxicity Information, GHS Classification Results, GHS Classification Results and Referential Safety Data Sheet (SDS), etc. which are available for free of charge.