Regional Comprehensive Economic Partnership (RCEP)
On 15th November 2020, China, Japan, South Korea, Australia, New Zealand and the ASEAN nations all signed the RCEP agreement. The agreement would be the largest that Australia has joined so far and covers approximately 30% of 2020 global GDP, with estimates of this rising to 50% of global GDP by 2030.
The RCEP will not commence until 60 days after six ASEAN countries and three non-ASEAN countries ratify the agreement. In addition, it could be up to 20 years for the full agreed tariff reductions are implemented.
The agreement will take into consideration all inputs from RCEP countries when determining rules of origin. This is the same as the accumulation rule currently allowed under the ASEAN-Australia-New Zealand FTA, but it is significant in that the RCEP includes China where a significant number of components are sourced from by other manufacturers. This means that the RCEP, when implemented, is likely to offer a greater certainty that manufactured goods will qualify for preferential duty rates under the agreement.
Additional information on RCEP will follow in future newsletters as it becomes available.
Chinese Trade Disruptions
As relationships between the Australian and Chinese Governments have reached an all-time low, an announcement has been made that commencing 28th November 2020, importations of Australian wine into China will be subject to significant Anti-Dumping tariffs. Interestingly, this announcement comes just days after Australia and China have signed the RCEP agreement.
There are now six of Australia’s export products that are currently being affected by these measures and recent shipments have faced delays on entry into Australia resulting in commercial losses. Exporters should carefully consider the associated risk and confirm with the buyer whether there is any potential disruption upon entry into China.
If you require any further information relating to these measures please contact Harders Advisory.
Product Emissions Standards
The Department of Agriculture, Water and the Environment administers the Product Emissions Standards. These standards apply to new spark-ignition (petrol) engines used in outdoor power equipment such as lawn mowers, blowers and generators; and items on vessels such as outboard engines and jet skis.
At commencement in July 2018, only products certified by one of the following authorities was considered to meet Australian standards and be permitted entry to Australia:
- The United States Environmental Protection Authority;
- European Union;
- Environment and Climate Change Canada;
- Californian Air Resources Board.
Australian standards previously accepted products certified by the European Union to Euro Stage II emissions. Since 1 July 2020, products must now be certified to Euro Stage V before they can be imported into Australia, in line with the EU phase out of Euro Stage II standards.
At time of entry to Australian Border Force, the importer must supply the product certification number or an exemption number.
For more information regarding this change, or emissions standards in general, please contact Harders Advisory.
DAWE Urgent Actions for Khapra Beetle – Update
Further to our broadcasts on this subject, the department has issued further information relating to the urgent actions in import industry advice notice 197-2020, details can be found here.
The department has advised that that due to the recent and increasing hitchhiker risk of khapra beetle in shipping containers, changes to the management of the same are now an immediate priority. As a result, Phase 6 of the urgent measures will now be implemented before Phases 3-5, proposed changes for plant products and seed for sowing.
These revised measures are currently being worked through and will be released, in consultations with various stakeholders, over the coming months.
Industry plays a pivotal role in supporting the department by reporting risks and contamination and helping maintain Australia’s fragile biosecurity. Further information to help identify khapra beetle can be found here.
For further information please contact Harders Advisory.
Burnt Pine Longicorn (BPL) flight measures 2020-21
The Department of Agriculture, Water and the Environment has issued Import Industry Advice Notice 201/2020 regarding commencement of the BPL flight season measures for 2020-21.
From midnight on 23rd November 2020, the department will increase surveillance of vessels arriving from New Zealand to manage the risks posed by BPL.
The department has requested vessel masters and crew to be vigilant for the pest, however importers and container depots should also keep a watch when unpacking imported containers. The BPL beetle is likely to enter Australia on vessels and cargo including imported timber and machinery from New Zealand. Adult beetles seek shelter in dark secluded areas during daylight, are active from dusk to dawn and are attracted to light. As with any insect detections during container unpacking, please immediately close the container doors and contact the department for further advice.
DAWE Notification of Potential Service Delays due to Khapra Beetle Interception
The department has forewarned, via import industry advice notice 204/2020, of the potential disruption to the capacity to meet published service standards over the coming weeks.
The recent interception of khapra beetle has resulted in the department’s decision to divert a number of staff to the emergency response, in particular relating to inspections and treatments and various locations around the country.
The timing could not be worse with the Christmas rush upon us and the compounded delays experienced into eastern ports, particularly Sydney, as a consequence of Covid-19 and industrial action.
These expected delays have already been addressed with the department given the fact that they are already failing to meet the service standards in areas including inspections and documents processing.
Further information will be provided when available.
Congestion through Sydney has eased from previous months where Protected Industrial Action and blank sailings caused a perfect storm of congestion and delays.
Melbourne port indicated that October 2020 was a record month for total container throughput up 4.5% on October 2019.
This month Patricks and DP World have indicated that vessels are berthing on time against their berthing windows at all terminals. Vessels are still running out of schedule from origin ports and all terminals are experiencing high volumes across all sectors.
Industrial action could return as Patrick and the MUA re-commence proceedings at the Fair Work Commission on the 1st December.
DP World and the MUA have agreed on new Enterprise Agreements in Sydney and Brisbane. Melbourne and Fremantle are still under negotiation.
Empty Container Parks – Sydney
The situation in Sydney has not eased with almost 50,000 TEU empty containers now in surplus around all the container parks. Shipping lines have worked hard to evacuate containers, however due to the high inbound volumes the surplus count increases daily.
With most ECP’s closing at different times during each day, the trucking companies are forced to dehire as many containers as possible in a shortened dehire window.
Whilst Sydney has experienced its fair share of empty container surplus, Melbourne may also be heading in the same direction with record volumes for October (up 9.8%) and a reduction in empty container movements (14.2%). There has already been some redirection of 40’ HC Containers to other yards as ECPs become full.
Industry continues to have dialogue with all stakeholders and Government to address this ongoing situation and are working on initiatives to improve the management of empty containers.
Increasing Terminal Booking Fees
Both DP World and VICT have flagged an increase in container booking fees from the 1st January 2021.
Each of the terminals have resisted to increase the Infrastructure fees and they will remain unchanged.
Vehicle Booking fees will increase 15% at VICT and 54% at DP World. In addition, DP World will implement a Chain of Responsibility fee to recover costs of the ‘weigh in motion’ devices that weigh containers in line with the compliance requirements for mass under CoR laws.
Please ensure you contact your Account Manager on how these fees will apply to your shipments.