CER Rules of Origin should be Liberalised

The rules of origin under the Closer Economic Relations Trade Agreement between Australia and New Zealand should be liberalised, according to a research report released by the Productivity Commission. This would allow freer trans-Tasman trade and better meet the intent of the Agreement.

Rules of origin are designed to confine access to trade concessions to goods from member countries. In its report - Rules of Origin under the Australia-New Zealand Closer Economic Relations Trade Agreement (CER) - the Commission found that the CER rules of origin have not kept pace with changes in technology and business practices. For example, outsourcing of some components or even a growth in sales can result in firms failing to meet rules of origin requirements.

The Productivity Commission’s recommendations include relatively minor changes to reduce operational problems and more substantial changes to liberalise the current rules. It recommends automatic duty free entry - via a waiver of CER content requirements - for goods produced in Australia or New Zealand which face small trans-Tasman tariff differences.

The Commission’s recommendations would reduce restrictions on businesses and enable them to lower costs, improve productivity and expand trade across the Tasman. The recommendations would also reduce compliance and administrative burdens, and would not impose significant adjustment costs.

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