Unless otherwise provided, ASEAN Member States (AMS) are removing import duties on all products traded between SSAs until (a) 2010 for ASEAN-6 (Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand) and (b) flexibly until 2018 for CLMV (Cambodia, Laos, Myanmar and Vietnam). The vast majority of trade agreements contain rules of origin to prevent third parties from freely making the sacrifices that the parties to the agreements make. These rules determine who is entitled to benefits under a particular agreement and under what circumstances those parties may do so. The ASEAN Agreement on Trade in Goods was signed on 26 February 2009 and is the result of the expansion and consolidation of all existing provisions of the CEPT-AFTA Agreement and the relevant ASEAN economic agreements and instruments. Within ATIGA, the concept of cumulation is applied to the rules of origin of the agreement. Currently, the ASEAN Trade in Goods Agreement (ATIGA) – ASEAN`s main agreement on regional tariff reduction – contains a number of criteria for determining the country of origin of a product and guidelines for determining whether certain products benefit from preferential tariff treatment. With the introduction of the ACS and the increasing harmonization of regional standards, the importance of regional supply chains cannot be underestimated. Further progress in regional integration is expected to continue these trends, further reduce trade barriers and reduce the impact of compliance on businesses throughout the region. While ASEAN`s prospects are good, success will ultimately depend on the ability of market participants to understand and seize the opportunities offered under agreements such as the ASEAN Agreement on Trade in Goods. Dezan Shira & Associates employs qualified professionals with years of experience in market entry and business creation and is perfectly positioned to help companies maximize business and expand throughout the region. Previous article: RCEP negotiations reach a critical phase – Probably colorful by the end of the year Given the significant reduction in tariffs among ASEAN members and the constant harmonization of regulations by the ASEAN Economic Community, regional value chains have increased significantly in terms of profitability.
For those considering such investments, it is important to understand not only the tariff reduction plans negotiated, but above all the conditions under which exports and imports can benefit from reduced rates.