The Thailand-Australia Free Trade Agreement (TAFTA) was signed on 5 July 2004 and came into effect on January 1, 2005. The Agreement calls for liberalization of trade in goods, services, and investment, as well as for cooperation in working out obstacles to trade caused by non-tariff measures, such as restrictive sanitary and phytosanitary regulations and anti-dumping measures. The cooperation extends also to facilitation of trade in certain categories, such as Customs procedures, electronic commerce, intellectual property, government procurement and competition policy. It is anticipated that this agreement will expand two-way trade in goods and services and increase investment on both sides, as well as strengthen the relationship between the two countries.

Rules of Origin

Under the Agreement, only goods that meet agreed-upon conditions of the 'country of origin' requirements for each product will be able to claim preferential treatment. The conditions comprise:

goods that are composed of completely domestic components (wholly obtained) such as mineral ore, agricultural products, and products from domestic live animals; or

goods that have undergone substantial transformation through processing, resulting in a change of tariff classification, and that have a significant regional value content of Thai and Australian components (40%-45% of the cost of the product) in their production.

In addition, such goods are required to meet direct consignment rules and other applicable requirements in the Rules of Origin under Thailand-Australia Free Trade Agreement.