4. Trade in goods - regulatory matters

Trade remedies, rules of origin, customs procedures and trade facilitation, SPS measures, and technical barriers to trade


This chapter examines Chapters 3 to 7 of the Free Trade Agreement between Australia and the United Kingdom of Great Britain and Northern Ireland (AUKFTA),1 specifically dealing with:
trade remedies
rules of origin
customs procedures and trade facilitation
sanitary and phytosanitary measures
technical barriers to trade.

Trade remedies

Trade remedies are mechanisms in international trade to resolve serious threats to the domestic industry of one party by exported goods of another party. Chapter 3 of the AUKFTA sets out trade remedies for dealing with three of these serious threats:
anti-dumping procedures
countervailing measures for dealing with subsidies
safeguarding measures for dealing with an unexpected surge in an imported good.
The provisions in Chapter 3 of the AUKFTA are based on existing agreements:
for anti-dumping, the World Trade Organization (WTO) Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Anti-Dumping Agreement)
for countervailing measures, the WTO Agreement on Subsidies and Countervailing Measures (SCM Agreement)
for safeguarding, the WTO General Agreement on Tariffs and Trade 1994 (GATT 1994) and the bespoke safeguards provisions of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).2


The Anti-Dumping Agreement defines dumping as one party introducing a product into the market of another party at less than its normal value, in other words, the product’s exported price is lower than the comparable price at which the product is sold in its home market.3


The SCM Agreement defines a subsidy as a form of either direct or indirect financial support for a business or industry by a government with the intention of giving that business or industry a competitive advantage in international trade.4

Unexpected quantities of imported goods

Article XIX of the GATT 1994 established the right of a party to take action in the event that a product is being imported into a party in unexpectedly increased quantities and under such conditions that, due to unforeseen developments and the effect of tariff reductions, it causes or threatens serious injury to the party’s domestic producers of the same or similar products.5
The WTO process for dealing with an injury to an industry as a result of a high quantity of an imported good was set down in the Agreement on Safeguards (Safeguards Agreement).6

Investigation process

While the trade in goods-related serious threats to domestic producers are different and are covered by different agreements, the process for establishing that a serious threat exists, and quantifying the cost of that threat, are quite similar and involve an investigative process. The process can be summarised as follows:
The aggrieved party prepares an application for an investigation into its concerns.
The application is submitted to the aggrieved party’s investigating authority to consider whether an investigation is warranted.
A request for an investigation can be declined by the authority if the authority is not satisfied there is sufficient evidence to proceed with an investigation.7
The authority notifies the party identified as the source of the threat of the request for an investigation.
The authority is generally required to complete its investigation in a set period of time, such as 12 months.
An investigation begins with a request for all parties to present all evidence they consider relevant.
Generally, the authority will provide an opportunity for both parties to present opposing views and rebuttals.
Authorities are also generally authorised to conduct investigations of their own to determine the veracity of evidence presented.
If the authority reaches a provisional determination that a threat exists, it may impose provisional restrictions to ameliorate that threat.
Investigations can be terminated upon the agreement of the parties involved.
Where the authority finds that a threat exists, the authority must determine the scope and type of the remedy. At this stage, the authority is generally obliged to release its findings to the public.8


A number of remedies are available in the event an investigation finds that a threat exists to an industry of a party under the relevant WTO agreements.

Anti-dumping measures

In relation to dumping, the party accused of dumping can offer during the investigation to:
… revise its prices or to cease exports to the area in question at dumped prices so that the authorities are satisfied that the injurious effect of the dumping is eliminated.9
If such an offer is accepted, the investigation will be terminated prior to a finding being made.10
Where a finding of dumping has been made, the aggrieved party can impose an anti-dumping duty, effectively a tariff, on the dumped imports up to the full margin of the difference between the price at which it is being dumped and the normal value of the exported product in its home market. The anti-dumping duty can be imposed only as long as is necessary to counteract the injury caused by the dumping.11

Countervailing measures for subsidies

In relation to subsidies, if an investigation by a party finds that a subsidy exists and that the subsidy is causing injury, it may impose a countervailing duty. If a countervailing duty is imposed, the duty must be non-discriminatory and apply to all sources of imports found to be subsidised and causing injury.12 A countervailing duty can only remain in force for as long as is necessary to counteract the subsidisation that is causing injury.13

Safeguard measures for unexpected quantities of imported goods

In circumstances where it has been found that the quantity of imports of a product has increased sufficiently to cause injury to a domestic industry, the Safeguards Agreement permits parties to ‘choose measures most suitable‘ to prevent or remedy serious injury and to facilitate adjustment in the industry. A party is to apply safeguard measures only to the extent necessary to achieve this objective.14
A party imposing a safeguard measure shall endeavour to maintain concessions to the exporting party substantially equivalent to the value of the measures imposed as a safeguard. To achieve this objective, the parties concerned may agree on any adequate means of trade compensation for the adverse effects of the safeguards on their trade.15

Key provisions in the trade remedies chapter

Anti-dumping and countervailing measures

Chapter 3 of the AUKFTA contains the following provisions in relation to anti-dumping and countervailing measures:
anti-dumping and countervailing measures based on article VI of GATT 1994, the Anti-Dumping Agreement and the SCM Agreement16
a requirement that a Party advises the other Party in writing upon receipt of a properly documented application for an anti-dumping or subsidy investigation, followed by an opportunity to consult with the aim of clarifying the situation on matters raised in the application17
an obligation on the investigating Party to make a full and meaningful disclosure of all essential facts under consideration18
if the investigating Party finds in favour of the applicant, the Party may consider whether the amount of the anti-dumping or countervailing duty imposed shall be the full margin or a lesser amount.19

Safeguard measures

The AUKFTA provides two channels for conducting safeguards investigations: the WTO process or a bespoke AUKFTA process based on the process in the CPTPP.

World Trade Organization safeguards measures

Article 3.5 provides a measure protecting the right of each Party to access the WTO process, regardless of the AUKFTA bespoke process,20 and goes on to reiterate a number of the provisions of the Safeguards Agreement, including that:
A Party can impose safeguards to protect a domestic industry from a product being imported in such increased quantities that causes serious injury or threatens serious injury to the industry.
A ‘serious injury’ is a significant overall impairment in the position of a domestic industry and a ‘threat of a serious injury’ means a serious injury that is clearly imminent.21
A Party commencing an investigation must provide a notice to the WTO Committee on Safeguards.22

Bilateral safeguards provisions

The AUKFTA contains its own bilateral safeguards provisions.23 The bilateral safeguard measures are limited to a ‘transition period.’ The transition period starts on the date of entry into force (EIF) of the AUKFTA and ends five years after customs duty reduction or elimination of the good in question.24
The bespoke bilateral safeguard provisions are as follows:
If, as a result of the reduction or elimination of customs duties, an originating good is being imported into a Party in such increased quantities that it causes serious injury or threatens serious injury to an industry of a Party, the Party may apply for a safeguard under the AUKFTA.25
The range of safeguards measures available are:
a suspension of further customs duty reductions or elimination in relation to the good
an increase in the rate of customs duty on the good to a level that does not exceed the lesser of: the most-favoured-nation (MFN) applied rate of customs duty in effect at the time the measure is applied; or the MFN applied rate of customs duty in effect on the day immediately preceding the date of EIF of the AUKFTA.26
A safeguard measure can only be imposed for as long as necessary to prevent or remedy serious injury and to facilitate the adjustment of the domestic industry, and has a maximum period of two years (though there is some provision for extension).27
The Party imposing safeguard measures shall progressively liberalise it at regular intervals during its period of application.28
Safeguards measures can only be applied after the completion of an investigation in accordance with the procedures for investigations set out in the Safeguards Agreement.29
A Party imposing safeguards measures is to consult with the other Party to provide mutually agreed trade concessions.30 If no agreement is reached, the Party against whose good the safeguard measure has been applied may suspend the application of substantially equivalent concessions.31

Dispute resolution

Neither Party shall have recourse to the dispute settlement procedures in Chapter 30 of the AUKFTA for any matter arising under Chapter 3.32

Rules of origin

Rules of origin are an essential development of trade agreements. Trade agreements allow preferential access to goods that are produced in the contracting parties. For the trade agreement to work, the contracting parties need to agree on a threshold, a ‘rule of origin’, that defines a good as originating in one of the contracting parties.33 In other words, rules of origin answer the question: does this product34 qualify for preferential access?
Rules of origin are addressed in Chapter 4 of the AUKFTA which contains three sections:
the rules for determining origin, including a number of provisions dealing with ancillary matters such as the treatment of the containers in which the products are encased and rules for small quantities of a product for demonstration purposes35
instructions for how origin is to be claimed or proven in order to access preferential tariff treatment (called origin procedures), and how claims can be verified (if required)
establishment of a Working Group on Rules of Origin and Customs and Trade Facilitation.

Key provisions in the rules of origin chapter

Establishing origin

Unless otherwise provided, a product shall be regarded as originating if it is either:
wholly obtained or produced within the territory of one or both of the Parties (covering primary agricultural products, primary fisheries products, minerals or other naturally occurring substances, and waste or scrap)36
produced entirely in the territory of one or both Parties exclusively from originating materials
produced entirely in the territory of one or both of the Parties using non-originating materials, provided the good satisfies all the applicable requirements of Annex 4B.37

Products using non-originating materials

To qualify under the rules of origin, products produced entirely in the territory of one or both of the Parties using non-originating materials must satisfy the requirements set out in Annex 4B of the AUKFTA.
Specific rules of origin for a good are based on its tariff classification using the harmonised system. Annex 4B contains the product-specific rule that applies to each good. The annex only includes those goods for which a rule of origin applies.
There are five possible ways a non-originating materials product can be altered to become an originating product:
CC—All non-originating materials used in the production of the good have undergone a change in tariff classification at the ‘chapter’ level.
CTH—All non-originating materials used in the production of the good have undergone a change in tariff classification at the ‘heading’ level.
CTSH—All non-originating materials used in the production of the good have undergone a change in tariff classification at the ‘sub-heading’ level.
FF—Fabric that is constructed but not further prepared or finished provided that it is dyed or printed and undergoes at least one preparatory or finishing process in the territory of one or both of the Parties to render it directly usable is considered originating.
RVC(X)—A good must have a ‘regional value content’ (RVC) as calculated under article 4.4 of not less than (X) per cent.38
The AUKFTA provides two methods for calculating the RVC to determine if the good meets the rules of origin:
‘Build-Down Method’, which calculates the percentage value of non-originating materials in a good
‘Build-Up Method’, which is based on the percentage value of the originating materials.39

Build-down method


Build-up method


Description automatically generated
If a non-originating material undergoes a production process within a Party before it is included in the RVC test, it would also need to undergo a RVC test.40
Having established these product specific rules of origin, there are a number of rules relating to the interpretation of the product specific rules, including:
tolerance for a small amount of non-originating materials in qualifying goods41
the treatment of accessories, spare parts, tools and instructional information included with a product, and packaging for retail sale42
the transition of a product through the territory of a third party while being transported between Parties.43

Origin procedures

The process for claiming origin is as follows:
An importer may make a claim for preferential tariff treatment based on a declaration of origin completed by a producer, an exporter, an importer, and in the case of Australia, an authorised representative of an exporter or producer.44
A declaration of origin may apply to a single shipment of a good, multiple shipments of identical goods for a period not exceeding 12 months, or multiple shipments of different parts of a disassembled good.45
The procedures to be followed in claiming preferential tariff treatment are:
an importer declares a good as qualifying as an originating good and possesses a valid declaration or documentation
the importer provides the declaration and any supporting documentation to the importing Party
if the importer believes the claim for preferential treatment is incorrect, they shall correct the documentation and pay any customs duty.46

Verification of origin

A customs authority can conduct a verification of any claim for preferential tariff treatment by:
a written request for information from the importer of the good
a written request to the exporter or producer of the good if the information obtained from the importer is not considered sufficient
a written request for information from the customs authority of the exporting Party where the information provided by the importer, exporter or producer is insufficient to make a determination as to the originating status of the good.47
The verifying customs authority can conduct an investigation at the time the declaration is lodged, or before or after the good has been released from the customs authority.48 Verification investigations must be applied in accordance with the rules set out in the AUKFTA.49


The Parties agree to establish a Working Group on Rules of Origin and Customs and Trade Facilitation, composed of government representatives of each Party with responsibility for rules of origin and customs and trade facilitations matters (discussed below). The working group is to consider any matters arising under Chapter 4 and Chapter 5 (customs procedures and trade facilitation) and would report to the Committee on Trade in Goods.50

Customs procedures and trade facilitation

In the context of free trade agreements (FTAs), the notional point at which an importer can make a claim for preferential tariff treatment is when a good passes through customs.51 These days, claims are usually made electronically and prior to the arrival of the goods in question. This is reflected in the provisions of agreements that cover customs procedures and trade facilitation.
Chapter 5 of the AUKFTA cements pre-existing commitments under the WTO’s Agreement on Trade Facilitation, and mirrors the obligations contained in the CPTPP.52
In most instances, the obligations in the AUKFTA are more prescriptive than those in the CPTPP in terms of the standards each Party’s customs authorities are required to meet. Obligations in the CPTPP generally provide for some variability in the standards, either by including provisions for parties that cannot meet an obligation, or providing that parties ‘work towards’ or ‘endeavour’ to meet particular standards.53

Key provisions in the customs procedures and trade facilitation chapter

In relation to customs procedures, the AUKFTA states:
Each Party shall ensure that their customs procedures are applied in a manner that is consistent, predictable, transparent and non-discriminatory.54
The Parties must simplify and minimise the complexity of import, export and transit formalities, including through the use of electronic systems that are accessible to customers for submitting customs declarations and for automatic risk analysis and targeting.55

Customs clearance times

Each Party is to adopt or maintain expedited customs procedures for expedited shipments, including providing in normal circumstances that expedited shipments be released from customs within six hours of arrival.56
For goods that are not expedited, the AUKFTA provides that the Parties would, with a limited number of exclusions:
release goods within 48 hours of arrival
allow goods to be released without temporary transfer to warehouses or other facilities
allow for the release of goods before determination of customs duties, taxes, charges and fees
provide for the clearance of certain goods with a minimum of documentation.57
For perishable goods:
goods would be released within six hours of arrival
in exceptional circumstances, goods would be released outside of business hours58
goods shall be given appropriate priority when scheduling physical examinations or inspections59
importers can arrange for the appropriate storage of goods pending their release.60

Inspections and risk management

To support the expedited release of goods, each Party is to adopt a post-clearance audit process for compliance with customs and other related laws using a risk-based approach.61
The AUKFTA states that Parties are required to adopt a risk management system for customs control that enables customs authorities to focus on inspecting high-risk consignments while expediting the release of low-risk consignments.62 Parties may also select consignments for inspection on a random basis.63

Advance rulings

An importer in the territory of a Party or an exporter in the other Party’s territory can apply for an advance ruling, including regarding the tariff classification of a good and whether the good meets the rule of origin requirements. Ideally, an advance ruling should permit goods to pass through customs unhindered.64 A Party may refuse to issue an advance ruling if there is some dispute as to the facts and circumstances at issue.65
Advance rulings are to remain in effect for at least three years, but may be modified or revoked within the three year period if there is a change in the law or the circumstances on which the ruling was based, the ruling conflicts with another advance ruling for goods of the same kind, or there is a change in the interpretation of the law.66

Customs valuation

The customs valuation of goods traded between the Parties would be based on Part I of the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994.67

Review, appeal and penalties

Importers wishing to appeal adverse decisions, including in relation to advance rulings, customs valuations, tariff and origin determinations, would be provided access to an administrative review of that decision, and a judicial appeal if required.68
The AUKFTA requires the Parties to administer the law in a way that is proportionate and non-discriminatory. Penalties shall only be imposed on the person legally responsible for the breach.69

Sanitary and phytosanitary measures

Sanitary or phytosanitary (SPS) measures are measures adopted by a country to protect animal or plant life or health within a country from risks arising from the entry, establishment or spread of pests and diseases. In addition, the measures are designed to protect human or animal life or health within a country from risks arising from additives, contaminants, and toxins or disease-causing organisms in foods, beverages, or feedstuffs. SPS measures also prevent or limit other damage within a country from the spread of pests.70
SPS measures include relevant laws, regulations, requirements, and procedures. Procedures include: processes and production methods; measures applying to the final product; testing, inspection, certification and approval procedures; quarantine procedures for the transport of animals or plants, or with the materials necessary for their survival during transport; methods of risk assessment; and packaging and labelling requirements directly related to food safety.71
The objectives of Chapter 6 of the AUKFTA, which deals with SPS measures, include:
protecting human, animal and plant life and health in the territory of the Parties while facilitating trade between them
ensuring that the Parties’ SPS measures do not create unjustified barriers to trade
reinforcing and building upon the implementation of the WTO Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement)
promoting greater transparency and understanding on the application of each Party’s SPS measures.72

Key provisions in the SPS measures chapter

Chapter 6 affirms the rights and obligations of the Parties under the SPS Agreement.73

Assessing risk

At the core of the SPS Agreement is the mechanism for assessing the SPS risk and balancing the risks with the economic costs SPS measures may inflict. Article 5.2 of the SPS Agreement states:
In the assessment of risks, [parties] shall take into account available scientific evidence; relevant processes and production methods; relevant inspection, sampling and testing methods; prevalence of specific diseases or pests; existence of pest — or disease — free areas; relevant ecological and environmental conditions; and quarantine or other treatment.74
Assessing risk must also account for the following as economic factors:
… the potential damage in terms of loss of production or sales in the event of the entry, establishment or spread of a pest or disease; the costs of control or eradication in the territory of the importing [parties]; and the relative cost-effectiveness of alternative approaches to limiting risks.75
The SPS Agreement also requires parties to avoid arbitrary and unjustifiable differences in the level of SPS protection if it results in discrimination or a disguised impediment to international trade.76
In the event sufficient scientific information is not available on an SPS risk, a SPS measure can be provisionally adopted on the basis of available information, including from international organisations and from SPS measures applied by other parties. Parties must seek to obtain the additional information necessary for a more objective assessment of risk within a reasonable period of time.77

Regulatory approaches to SPS measures

The approach of the United Kingdom (UK) to SPS measures, like that of the European Union (EU), is based on the ‘precautionary principle’,78 which involves erring on the side of caution when there is scientific uncertainty about a potential danger to safety or health. Australia on the other hand adheres to the risk-based approach, focussing on proven risks.79 The point of difference between the approaches adopted by the UK and Australia rests on the interpretation of part of article 5.2 of the SPS Agreement, which states that parties:
… shall take into account available scientific evidence …80
Chapter 6 of the AUKFTA contains no explicit reference to the precautionary approach to SPS measures currently applied by the UK, only to the WTO version of the principle.81 However, the WTO’s advice on SPS measures establishes a fallback position that would permit the use of the precautionary principle. According to the WTO, parties:
… can also set higher standards based on appropriate assessment of risks so long as the approach is consistent, not arbitrary.82
Article 6.7 of the AUKFTA requires an importing Party to recognise the equivalence of the SPS measures of the exporting Party, even if those measures differ.83 However, the final determination of equivalence rests with the importing Party.84
Parties are to ensure that SPS control, inspection, assessment and approval procedures are undertaken and completed without delay, and information requests by the importing Party shall not be burdensome.85 Information concerning SPS import requirements are to be publicly available or provided on request.86
Parties shall have the right to carry out an audit or verification of all or part of the control system of the competent authority87 of the exporting Party.88 If possible, an audit or verification is to be systems-based and designed to check the effectiveness of the regulatory controls of the exporting Party.89 Parties are to endeavour to agree on the conditions under which an audit or verification is to be carried out in advance.90
If a Party requires import certification, its SPS certification requirements must apply only to the extent necessary to meet SPS objectives. Parties may consult through the SPS Committee to agree principles, guidelines, or specific requirements for certification.91
Importing Parties retain the right to undertake import checks on SPS risks. These must be carried out without delay and with minimum disruption to trade.92
Article 6.12 of the AUKFTA permits Parties to adopt emergency SPS measures where necessary to protect human, animal or plant life or health. If a Party adopts an emergency SPS measure, the Party must notify the other Party as soon as possible.93
Each Party shall also advise the other of any new or revised SPS measures more generally.94
If a Party has specific concerns regarding SPS measures proposed or implemented by the other Party, it may request technical consultations. To undertake technical consultations, each Party shall provide all information necessary to avoid disruption to trade and reach an acceptable solution within a reasonable period of time.95

Technical barriers to trade

Chapter 7 of the AUKFTA covers matters related to technical barriers to trade and conformity assessments. The AUKFTA affirms the primacy of the WTO’s Agreement on Technical Barriers to Trade (TBT Agreement).96

TBT Agreement and technical barriers to trade

Technical barriers to trade are mandatory technical regulations and voluntary standards that:
define specific characteristics that a product should have, such as size, shape, design, labelling, functionality or performance97
establish rules, guidelines or characteristics for processes and production methods
deal with terminology, symbols, packaging, marking or labelling rules as they apply to a product, process or production method.98
Technical regulations and standards are usually introduced by government authorities with a legitimate public policy objective in mind, including for example:
labelling of food ingredients
safety of toys
technical specifications of cars
safety and energy efficiency of home appliances.99
Technical regulations and standards can have an impact on the competitiveness of exporters, such as a need to adjust products and production processes to comply with requirements in export markets, and to demonstrate compliance with these requirements.100 The significance of technical regulations and standards in international trade has increased as tariffs are removed or reduced and governments introduce regulatory requirements to address health, safety or environmental concerns.101
The objective of the WTO’s TBT Agreement is to ensure technical regulations and standards are not used to discriminate or arbitrarily restrict international trade, and to prevent technical regulations and standards inadvertently restricting international trade.102

Key provisions in the technical barriers to trade chapter

The technical barriers to trade provisions in the AUKFTA are a close match to those in the WTO TBT Agreement. Chapter 7 of the AUKFTA affirms the primacy of the TBT Agreement over the provisions of the chapter, stating:
Nothing in this Chapter shall prevent a Party from adopting or maintaining technical regulations, standards, or conformity assessment procedures in accordance with its rights and obligations under this Agreement, the TBT Agreement, and any other relevant international agreement.103
Chapter 7 states that unless otherwise provided, the chapter applies to the preparation, adoption and application of all technical regulations, standards and conformity assessment procedures of the central level of government that may affect trade between the Parties.104 Further, the chapter does not apply to:
technical specifications prepared by government bodies for the production or consumption requirements of such bodies
SPS measures which are covered by Chapter 6 of the AUKFTA and discussed above.105

Technical regulations

Article 7.5 requires that each Party consider accepting the technical regulations of the other Party as equivalent to its own, provided it is satisfied that the regulations adequately fulfil its own regulatory objectives.106
Each Party must, in accordance with articles 2.4 and 5.4 of the TBT Agreement, use international standards, guides and recommendations or parts thereof as a basis for its technical regulations and conformity assessment procedures.107 Where a Party does not do so, it shall at the request of the other Party provide its reasons for not doing so.108

Conformity assessment

The Parties recognise a range of mechanisms exist for accepting the results of conformity assessment procedures conducted in the other Party, including:
agreeing with the results of conformity assessment procedures undertaken by a body located in the other Party
adopting the accreditation procedures of conformity assessment bodies in the other Party
recognising the results of conformity assessment procedures conducted in the other Party
permitting conformity assessment bodies in each Party to enter into voluntary arrangements accepting each other’s assessment procedures
relying on a supplier’s declaration of conformity.109
The Parties recognise the pre-existing Agreement on Mutual Recognition in Relation to Conformity Assessment, Certificates and Markings between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of Australia 2019. This agreement was considered by the Committee during the last Parliament.110

Markings and labelling

For technical regulations that deal with mandatory marking or labelling requirements, each Party shall:
accord no less favourable treatment to products imported from the other Party than to its own like products or those originating in any other country
ensure that marking and labelling regulations are not prepared, adopted, or applied with a view to creating unnecessary obstacles to international trade.111
If a Party requires mandatory marking or labelling, a Party may accept non-permanent labels, or marking or labelling in the accompanying documentation in place of attaching it to the product.112
Article 7.8 states that mandatory marking or labelling requirements must not be more trade restrictive than necessary to fulfil a legitimate objective, including: national security requirements; prevention of deceptive practices; and protection of human, animal or plant health, or the environment.113


The Parties would establish a Committee on Technical Barriers to Trade (TBT Committee). The functions of the committee would include:
monitoring the operation and implementation of Chapter 7
providing a regular forum for information exchange on matters related to Chapter 7
providing a forum for seeking to resolve differences that may arise regarding the interpretation or application of Chapter 7.114
If a Party declines to discuss an issue through the TBT Committee, it shall on request of the other Party explain the reasons for its decision.115

Matters of interest

Geographical indications

A geographical indication (GI) is a sign used on products that have a specific geographical origin and possess qualities or a reputation that are due to that origin. In order to function as a GI, a sign must identify a product as originating in a given place.116
GI was discussed during the Committee’s public hearings into the AUKFTA, particularly in relation to the wine grape prosecco, and its use in labelling wines. According to Australian Grape and Wine:
We cannot use prosecco in the United Kingdom. It is a hangover from when they were part of the European Union, where they basically adopted all of those geographical indications. I don't think the story is over with prosecco and the UK.117
The Department of Foreign Affairs and Trade (DFAT) confirmed this was a result of Brexit:
The UK is bound to recognise certain EU GIs under the terms of its withdrawal agreement with the EU. That is a matter for the UK. The FTA doesn't require the UK to undertake anything in contradiction to its existing withdrawal agreement with the EU ...118
Nevertheless, DFAT told the Committee:
What we've put into the intellectual property chapter of the Australia-UK FTA is a mechanism whereby, if Australia does agree with any other third party, including the EU, to change our GI system for whatever reason, particularly under a trade agreement, that level of treatment will also be accorded to the UK ...119

Annex on cosmetics

Chapter 7 contains a single annex relating to cosmetics.120 Specifically:
This Annex applies to the preparation, adoption, and application of technical regulations, standards, conformity assessment procedures, marketing authorisation, and notification procedures of central government bodies that may affect trade in cosmetic products between the Parties.121
Each Party’s obligations under this annex apply to any product the Party defines as a cosmetic.122
The annex states that the preparation of technical regulations, standards, conformity assessment procedures, or marketing authorisation includes, as appropriate, the evaluation of the risks involved, the need to adopt a measure to address those risks, the review of relevant scientific or technical information, and consideration of the characteristics or design of alternative approaches.123
In relation to animal testing of cosmetics, neither Party shall require that a cosmetic product be tested on animals to determine the safety of that cosmetic product unless there is no valid alternative method available to assess safety.124 However, the testing of products on animals remains banned in both the UK and Australia.125

Side letters – Medicines and medical devices

There are side letters in the AUKFTA on medicines and medical devices which commit Australia and the UK to strengthen their cooperation on issues of mutual interest concerning regulation of medicines and medical devices.126
The side letters identify five matters on which the Parties may cooperate:
medicine supply chains and security
‘evolving areas‘, in particular improving the international response to global health threats such as pandemics
the promotion of dialogue on scientific matters and the exchange of information on regulatory activity, including to enhance patient and animal safety, pharmacovigilance, and market surveillance for medical devices and medicines
collaboration through relevant international initiatives, including to support greater regulatory harmonisation of respective regulations covering medicines and medical devices
exploring collaboration on regulating new and innovative medicines and medical devices.127

  • 1
    Free Trade Agreement between Australia and the United Kingdom of Great Britain and Northern Ireland (Adelaide, 17 December 2021 and London, 16 December 2021) [2022] ATNIF 3, hereafter AUKFTA.
  • 2
    World Trade Organization (WTO), ‘Briefing note: Anti-dumping, subsidies and safeguards’, www.wto.org/english/thewto_e/minist_e/mc9_e/brief_adp_e.htm, viewed 20 April 2022; House of Commons International Trade Committee, UK trade negotiations: Agreement with Australia, 6 July 2022, page 145.
  • 3
    Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Geneva, 12 April 1979) [1982] ATS 23, hereafter Anti-Dumping Agreement, article 2.1.
  • 4
    Agreement Establishing the World Trade Organisation, Annex 1A - Agreement on Subsidies and Countervailing Measures (Marrakesh, 15 April 1994) [1995] ATS 8, hereafter the SCM Agreement, article 1.
  • 5
    Agreement Establishing the World Trade Organization, Annex 1A - General Agreement on Tariffs and Trade 1994 (Marrakesh, 15 April 1994) [1995] ATS 8, article XIX.
  • 6
    Agreement Establishing the World Trade Organisation, Annex 1A - Agreement on Safeguards (Marrakesh, 15 April 1994) [1995] ATS 8, hereafter Safeguards Agreement.
  • 7
    For clarity, the relevant agreements generally provide some guidance on what constitutes a ‘threat.’
  • 8
    The example presented here comes from the Anti-Dumping Agreement, articles 5-12.
  • 9
    Anti-Dumping Agreement, article 8.1.
  • 10
    Anti-Dumping Agreement, article 8.1.
  • 11
    Anti-Dumping Agreement, articles 9, 11.
  • 12
    SCM Agreement, article 19.
  • 13
    SCM Agreement, article 21.
  • 14
    Safeguards Agreement, article 5.1.
  • 15
    Safeguards Agreement, article 8.1.
  • 16
    AUKFTA, article 3.2.
  • 17
    AUKFTA, articles 3.3(1)-(2).
  • 18
    AUKFTA, article 3.3(4).
  • 19
    AUKFTA, article 3.4.
  • 20
    AUKFTA, article 3.5(1).
  • 21
    AUKFTA, article 3.1.
  • 22
    AUKFTA, article 3.5(2).
  • 23
    House of Commons International Trade Committee, UK trade negotiations: Agreement with Australia, 6 July 2022, page 145.
  • 24
    AUKFTA, articles 3.1, 3.7(6).
  • 25
    AUKFTA, article 3.6(1).
  • 26
    AUKFTA, article 3.6(2).
  • 27
    AUKFTA, articles 3.7(1)-(2).
  • 28
    AUKFTA, article 3.7(3).
  • 29
    AUKFTA, article 3.8(1).
  • 30
    AUKFTA, article 3.11(1).
  • 31
    AUKFTA, article 3.11(2).
  • 32
    AUKFTA, article 3.13.
  • 33
    L R R Meneses, ‘Rules of Origin and Origin Procedure’, in J A Huerta-Goldman and D A Gantz, eds, The Comprehensive and Progressive Trans-Pacific Partnership: Analysis and Commentary, Cambridge University Press, Cambridge, 2022, page 162.
  • 34
    A ‘product’ means a good identified under the harmonised classification system. See Chapter 3 of the report for an explanation of the harmonised classification system.
  • 35
    AUKFTA, articles 4.10-4.17.
  • 36
    AUKFTA, article 4.3.
  • 37
    AUKFTA, article 4.2.
  • 38
    AUKFTA, Annex 4B, articles 1, 8.
  • 39
    AUKFTA, article 4.4(1).
  • 40
    AUKFTA, article 4.5.
  • 41
    AUKFTA article 4.10.
  • 42
    AUKFTA, articles 4.12-4.13.
  • 43
    AUKFTA, article 14.17.
  • 44
    AUKFTA, article 4.18(1).
  • 45
    AUKFTA, articles 4.18(3), (5).
  • 46
    AUKFTA, article 4.22.
  • 47
    AUKFTA, article 4.24(1).
  • 48
    AUKFTA, article 4.24(1).
  • 49
    See: AUKFTA, articles 4.24(3), 4.24(5)-(6), 4.25(2).
  • 50
    AUKFTA, articles 4.29(1), (4).
  • 51
    Australian Border Force, ‘How to Import: Declarations for imported goods’, www.abf.gov.au/
    importing-exporting-and-manufacturing/importing/how-to-import/import-declaration, viewed 22 April 2022.
  • 52
    National Interest Analysis [2022] ATNIA 3 with attachments on consultation, Regulation Impact Statement and benefits for Australia, Free Trade Agreement between Australia and the United Kingdom of Great Britain and Northern Ireland (Adelaide, 17 December 2021 and London, 16 December 2021) [2022] ATNIF 3, paragraph 27; House of Commons International Trade Committee, UK trade negotiations: Agreement with Australia, 6 July 2022, paragraph 177.
  • 53
    See for example: Comprehensive and Progressive Agreement for Trans-Pacific Partnership (Santiago, 8 March 2018) [2018] ATS 23, article 5.6 concerning automation.
  • 54
    AUKFTA, articles 5.3(1)-(3).
  • 55
    AUKFTA, articles 5.4(1)-(2).
  • 56
    AUKFTA, article 5.7.
  • 57
    AUKFTA, article 5.8(2).
  • 58
    AUKFTA, articles 5.20(1)-(2).
  • 59
    AUKFTA, article 5.20(3).
  • 60
    AUKFTA, article 5.20(4).
  • 61
    AUKFTA, article 5.17.
  • 62
    AUKFTA, articles 5.9(1)-(3).
  • 63
    AUKFTA, article 5.9(4).
  • 64
    AUKFTA, articles 5.10(1)-(2).
  • 65
    AUKFTA, article 5.10(2).
  • 66
    AUKFTA, articles 5.10(4)-(6).
  • 67
    AUKFTA, article 5.11.
  • 68
    AUKFTA, article 5.12.
  • 69
    AUKFTA, articles 5.13(1)-(3).
  • 70
    Agreement Establishing the World Trade Organisation, Annex 1A - Agreement on the Application of Sanitary and Phytosanitary Measures (Marrakesh, 15 April 1994) [1995] ATS 8, hereafter SPS Agreement, Annex A, article 1.
  • 71
    SPS Agreement, Annex A, article 1.
  • 72
    AUKFTA, article 6.2.
  • 73
    AUKFTA, article 6.4.
  • 74
    SPS Agreement, article 5.2.
  • 75
    SPS Agreement, article 5.3.
  • 76
    SPS Agreement, article 5.5.
  • 77
    SPS Agreement, article 5.7.
  • 78
    The precautionary principle means that if there is objective preliminary evidence indicating that there are reasonable grounds for concern about potentially dangerous effects on the environment, human, animal or plant health, but there is still scientific uncertainty in this regard, then there are grounds for taking measures to avoid those potential risks. See: European Union (EU), ‘EU-Japan Economic Partnership Agreement: Precautionary principle’, trade.ec.europa.eu/doclib/docs/2017/july/tradoc_155718.pdf, viewed 18 August 2022.
  • 79
    House of Commons International Trade Committee, UK trade negotiations: Agreement with Australia, 6 July 2022, paragraph 127.
  • 80
    The WTO’s own interpretation of article 5.2 appears closer to Australia’s approach, stating that an assessment must be based on ‘the actual risks involved’. See: SPS Agreement, article 5.2.
  • 81
    House of Commons International Trade Committee, UK trade negotiations: Agreement with Australia, 6 July 2022, paragraph 127.
  • 82
    WTO, ‘Understanding the WTO Agreement on Sanitary and Phytosanitary Measures’, www.wto.org/english/tratop_e/sps_e/spsund_e.htm, viewed 18 August 2022.
  • 83
    AUKFTA, article 6.7(2).
  • 84
    AUKFTA, article 6.7(2).
  • 85
    AUKFTA, article 6.8(3).
  • 86
    AUKFTA, articles 6.8(1)-(2).
  • 87
    A ‘competent authority’ is the authority nominated by the Party to implement these provisions of the AUKFTA.
  • 88
    AUKFTA, article 6.9(1).
  • 89
    AUKFTA, article 6.9(2).
  • 90
    AUKFTA, article 6.9(4).
  • 91
    AUKFTA, articles 6.10(1)-(2).
  • 92
    AUKFTA, article 6.11(1).
  • 93
    AUKFTA, articles 6.12(1)-(2).
  • 94
    AUKFTA, articles 6.14(2)-(3).
  • 95
    AUKFTA, article 6.15.
  • 96
    AUKFTA, article 7.3(5).
  • 97
    European Commission, Technical Barriers to Trade, 2013, page [1].
  • 98
    Agreement Establishing the World Trade Organisation, Annex 1A - Agreement on Technical Barriers to Trade (Marrakesh, 15 April 1994) [1995] ATS 8, Annex 1, article 2.
  • 99
    European Commission, Technical Barriers to Trade, 2013, page [1].
  • 100
    European Commission, Technical Barriers to Trade, 2013, page [1].
  • 101
    European Commission, Technical Barriers to Trade, 2013, page [1].
  • 102
    European Commission, Technical Barriers to Trade, 2013, page [1].
  • 103
    AUKFTA, article 7.3(5).
  • 104
    AUKFTA, article 7.3(1).
  • 105
    AUKFTA, article 7.3(4).
  • 106
    AUKFTA, article 7.5(1).
  • 107
    AUKFTA, article 7.6(2).
  • 108
    AUKFTA, article 7.6(3).
  • 109
    AUKFTA, article 7.7(1).
  • 110
    AUKFTA, article 7.7(4); Joint Standing Committee on Treaties, Report 187: Oil Stock Contracts—Hungary; MRA UK; Trade in Wine UK; MH17 Netherlands; Air Services: Thailand, Timor–Leste, PNG; Work Diplomatic Families—Italy; Double Taxation— Israel, October 2019.
  • 111
    AUKFTA, article 7.8(1).
  • 112
    AUKFTA, article 7.8(2).
  • 113
    AUKFTA, article 7.8(1).
  • 114
    AUKFTA, articles 7.12(1)-(2).
  • 115
    AUKFTA, article 7.12(4).
  • 116
    World Intellectual Property Organization, ‘Geographical Indications’, www.wipo.int/geo_
    indications/en/, viewed 20 October 2022.
  • 117
    Mr Anthony Battaglene, Chief Executive Officer, Australian Grape and Wine, Committee Hansard, Canberra, 20 September 2022, page 37.
  • 118
    Mr Will Nixon, Assistant Director, Free Trade Agreement Services Branch, Department of Foreign Affairs and Trade (DFAT), Committee Hansard, Canberra, 26 September 2022, page 7.
  • 119
    Mr Will Nixon, DFAT, Committee Hansard, Canberra, 26 September 2022, page 7.
  • 120
    AUKFTA, article 7.15.
  • 121
    AUKFTA, Annex 7A, article 2.
  • 122
    AUKFTA, Annex 7A, article 3.
  • 123
    AUKFTA, Annex 7A, article 3.
  • 124
    AUKFTA, Annex 7A, article 22.
  • 125
    House of Commons International Trade Committee, UK trade negotiations: Agreement with Australia, 6 July 2022, paragraph 59.
  • 126
    The Rt Hon Anne-Marie Trevelyan MP, Secretary of State for International Trade, Letter of understanding on medicines and medical devices to the Hon Dan Tehan MP, Minister for Trade, Tourism and Investment, 16 December 2021; The Hon Dan Tehan MP, Minister for Trade, Tourism and Investment, Letter of understanding on medicines and medical devices to the Rt Hon Anne-Marie Trevelyan MP, Secretary of State for International Trade, 17 December 2021, hereafter Letters of understanding on medicines and medical devices.
  • 127
    Letters of understanding on medicines and medical devices.

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