Supporting Pacific countries to stimulate economic growth through efficient and transparent administration of trade commitments.
Facilitate effective utilisation of the PACER Plus commitments through efficient and transparent administration of Rules of Origin (ROO) requirements and other aspects of implementation of tariff commitments.
PACER Plus' fundamental aim is to reduce barriers to business activities and growth whilst taking into account the significant differences in the sizes and level of development between country partners and the Pacific Island nations. Reductions in tariffs is critical to this goal with Australia and New Zealand committing to immediately reduce tariffs to zero when doing business with partnering states. Pacific Island nations also have a commitment to this goal over a 25-year period, with each nation varying its levels of reductions dependent on their circumstance.
PACER Plus requires Parties to extend, immediately and unconditionally, the same treatment provided to all non-parties. MFN tariff treatment provides a guarantee of non-discrimination — any improvement on deals within party member states will be benefited throughout all participating members. Should one nation negotiate a free trade agreement, its accessible benefits flow to all other member states.
PACER Plus provides flexibility to members on when they undertake scheduled tariff reductions and a variety of safeguards, based on each country's varying level of resources, geographical isolation, and vulnerability to natural disasters.
Origin is the 'economic' nationality of goods traded in commerce. It is the origin that determines the duties and taxes that apply to a product when exported abroad. PACER Plus follows a general approach to Rules of Origin (RoO) similar to other trade agreements in the Pacific. Preferences are only available to products where it can be demonstrated that they are "originating goods" of one or more Parties of PACER Plus. In broad terms, the approach requires that products are wholly produced in a PACER Plus Party or, where non-originating goods are concerned, are substantially transformed within the Party (or Parties) under the cumulation provisions.
The ROO Chapter of PACER Plus sets out the conditions on which goods will be treated as "originating" within the PACER Plus region. PACER Plus ROO allow a high degree of flexibility in determining the origin of goods for export. One way a good is eligible for preferential treatment is if it satisfies all applicable requirements of Annex 3-B, as a result of processes performed entirely in the territory of one or more of the Parties by one or more producer.
The Product Specific Rule Schedule in PACER Plus sets out three alternative rules to determine if an imported good originates from a Party. Any one of these must be met to qualify for a preference:
A good has undergone a significant production process that changes its tariff classification. The degree of change required to confer origin is specified for each product in the PSR Schedule.
At least 40 per cent of value-adding has taken place within the PACER Plus membership. This is an option for some but not all products.
A good has undergone a specific process that fundamentally changes its nature — for example, a substance that undergoes a chemical reaction that transforms it but does not necessarily change its tariff classification or does not change it sufficiently to apply the CTC rule. Available for some products.
Exporters under PACER Plus are not required to obtain independent certification that their goods are originating — they need only provide a Declaration of Origin, which can be the invoice of the goods or a separate document with company letterhead. This reduces compliance costs for exporters.
The Agreement gives Pacific Island nations the ability to source inputs from a various range of countries whilst still qualifying for duty-free entry to Australia and New Zealand.
Australia and New Zealand will also assist Pacific Island countries upgrade their sanitary and phytosanitary capabilities to meet a greater quality of standards, providing Pacific Island nations the capabilities to reach regional and global markets for products.
Attempts at modernising customs procedures through PACER Plus will further facilitate trade by reducing border costs. Consumers will have access to higher quality goods at a more affordable price, with producers and manufacturers having more access to cheaper inputs enhancing competitiveness.
