TradeLane

The long discussed, debated, and awaited China-Australia Free Trade Agreement (ChAFTA), which was first proposed in 1999 and since then has been in the works, was finally signed on June 17, 2015 in Canberra.

With China-Australia Free Trade Agreement having been the third in the quick succession of three Free Trade Agreements Australia signed with its major trading partners, Korea, Japan and China in almost one year, Australia's exports and GDP are predicted to grow significantly.

A friend of mine was over a few weeks ago and while relaxing on the deck, the topic of EU Agriculture Regulation came up. I typically try to confine my weekend leisure discussions to things like how the NY Giants are doing, but alas, it was July. My friend is also a professor whose expertise lies in biotech regulation for EU member States, so I might have been out of my league. In a simultaneous attempt to confuse, amaze and distract, I brought up the US Chicken tax, one of the most obscure, draconian pieces of Trade Regulation I could come up with that somehow explains why we aren’t all driving German Pickup Trucks.

In 1519 Ferdinand Magellan set sail on an expedition to be the first person to successfully cross the Pacific Ocean. Relying heavily on the navigational technology of his time he would have depended upon instruments such as hour glasses, palnispheres, quadrants and compasses, all of which would have been considered high technology.

Is the Trusted Trader Program (TTP) the beginning of a “new trade era” for the Down Under?

You might be asking “What is it and how is it relevant to me?” The idea is that it is a modernized system developed by both Australian Customs and Border Protection (ACBPS) to enhance the competitiveness of Australian traders by relieving unnecessary administrative and regulatory burdens, whilst still protecting the borders from associated risk.  The process being designed is in accordance with the trade facilitation measures outlined in the World Trade Organization’s Trade Facilitation Agreement, also known as the SAFE Framework.

The TTP will provide some clearance privileges to recognized trusted traders. In simple terms, think of the TTP as a relationship with the ACBPS built on trust and shared responsibility. Sounds like a marriage, right?

China is under immense pressure to provide both a smooth and secure trade environment considering their role as one of the leading merchandise traders in the world. Cumbersome Custom formalities imposed on imports and exports have caused issues for the entire industry.

Suppose a company is located and registered in a landlocked province like Jiangxi or Sichuan where their inbound ocean freight will first land in coastal areas such as Shanghai, Shenzhen, or Xiamen. Traditionally, the company would be required to clear its imports with customs at the point of entry which means important decisions, physical inspections of goods, and taxes/duties all occur with your business presence and support hundreds of miles away.