IN THIS ARTICLE
China is one of the main sources of stock for Australian importers, and most goods made there can now enter duty free under the China-Australia Free Trade
Agreement. Even so, many importers still pay the general rate of duty on goods that should qualify for ChAFTA. The concession is not applied automatically. It depends on where the goods were actually made, and on holding the right proof of origin when they are imported.
This guide looks at ChAFTA from the importer's side: which goods qualify, what paperwork you need, the mistakes that lose the concession, and how the claim is made.
TL;DR Quick Answers
ChAFTA lets goods that originate in China enter Australia at a preferential duty rate, which is now nil for most goods. To claim it, the goods must meet ChAFTA’s rules of origin, and you need a valid certificate of origin for each shipment over AUD 1,000. Being shipped from China is not enough on its own.
What is ChAFTA and what does it mean for importers?
ChAFTA is the free trade agreement between Australia and China. For importers, its main effect is that Chinese-origin goods can enter Australia at a lower duty rate than goods from countries without an agreement.
- Duty rate: Australia’s tariffs on goods originating in China were fully phased out by 1 January 2019, so the ChAFTA rate for most goods is now nil.
- The saving: Without ChAFTA, many goods attract the general rate of duty, commonly 5% of the customs value. GST is also charged on that duty, so the saving is slightly more than the duty itself.
- The condition: The goods must originate in China under ChAFTA’s rules, and you must prove it.
On a shipment with a customs value of AUD 20,000, a 5% general rate means AUD 1,000 in duty, plus AUD 100 of GST on that duty. Claiming ChAFTA removes both. The full breakdown of how duty, GST and fees are calculated is covered in our guide to import tax in Australia.
Do your goods qualify for ChAFTA?
Your goods qualify if they originate in China under ChAFTA’s rules of origin. What matters is where the goods were made, not where they were shipped from.
There are three main ways a good can originate in China:
- Wholly obtained: Goods grown, mined, harvested or caught in China, such as agricultural products and natural resources.
- Wholly produced: Goods made in China entirely from materials that themselves originate in China or Australia.
- Product-specific rules: Goods made in China using some imported materials, as long as those materials go through enough change in China. Depending on the product, this is measured by a change in tariff classification, a minimum share of regional value content, or a specific manufacturing process.
Details that often catch importers out:
- Simple operations do not count: Packaging, simple grinding, washing and similar minor steps in China do not make foreign goods Chinese.
- Small foreign content is allowed: Non-originating materials worth up to 10% of the good’s value can be disregarded.
- The rule depends on the tariff classification: The product-specific rule for your goods is set by their tariff classification, so the classification must be right before the origin check means anything.
If your supplier is a trading company, ask where the goods were manufactured. Goods made elsewhere and shipped through a Chinese port do not qualify.
What proof of origin do you need for ChAFTA?
For each shipment over AUD 1,000, you need a ChAFTA certificate of origin issued in China.
- Certificate of origin: Issued by an authorised body in China: the General Administration of Customs of China or the China Council for the Promotion of International Trade. Your supplier applies for it.
- One shipment per certificate: Each certificate covers one shipment and can list up to 20 goods.
- Valid for 12 months: A certificate is valid for 12 months from the date it is issued.
- Declaration of origin: Completed by the exporter or producer on the ChAFTA template. It can only be used for goods covered by an advance ruling on origin.
- Low-value shipments: No proof of origin is needed if the customs value of the originating goods is AUD 1,000 or less. This does not apply to shipments split up to stay under the threshold.
Is a statement of origin the same as a ChAFTA certificate?
No. Only a ChAFTA certificate of origin supports a ChAFTA claim. A general statement of origin or an ordinary certificate of origin may show where goods were made, but it cannot be used to claim the concession. When you ask your supplier for proof of origin, ask specifically for a ChAFTA certificate of origin.
Can a certificate be issued after the goods ship?
Yes. A ChAFTA certificate of origin can be issued within 12 months of the date of shipment. It must carry the remark “ISSUED RETROSPECTIVELY”.
What mistakes lose the ChAFTA concession?
Most lost claims come down to origin, paperwork or the shipping route.
- Goods that do not originate in China: The goods were made elsewhere, or only packed or labelled in China.
- Details that do not match: The description, quantity or tariff classification on the certificate differs from the invoice and the goods.
- An expired certificate: The certificate is more than 12 months old, or it was issued for a different shipment.
- A third-party invoice not shown: The invoice comes from a company outside China, such as a Hong Kong trading company, and the certificate does not name it in the box provided.
- Problems in transit: Goods that pass through another country must stay under customs control there. Anything beyond unloading, reloading, storage, repacking or relabelling can break origin, and storage cannot exceed 12 months.
- Split shipments: Breaking one order into several shipments under AUD 1,000 to avoid needing a certificate.
- Missing records: The certificate and import documents must be kept for five years.
Minor typing errors on a certificate do not cancel it by themselves, provided the origin of the goods is not in doubt and the certificate matches the goods.
What happens if a ChAFTA claim is wrong?
The general rate of duty applies and any underpaid duty must be paid. The importer can also face an infringement notice or prosecution, plus a penalty on any GST shortfall. If you find a claim was wrong after the goods are cleared, amend the import declaration and pay the shortfall promptly. Coming forward voluntarily can reduce or remove penalties.
How does a customs broker claim ChAFTA?
The claim is made on the import declaration. Most of the work happens before that, in checking the goods qualify and the paperwork is right.
- Confirm the tariff classification. This sets both the duty rate and the origin rule that applies.
- Compare the rates. Check the ChAFTA rate against the general rate, as Australia can lower its general rates too.
- Check the origin rule. Confirm the goods meet the rule for their classification.
- Request the certificate early. Ask the supplier for a ChAFTA certificate of origin before the goods ship, and check its details against the invoice.
- Check the route. Confirm the goods travel direct or stay under customs control in transit.
- Lodge the declaration. A licensed customs broker claims the ChAFTA rate on the import declaration.
- Keep the records. Store the certificate and import documents for five years.
For the wider process, from booking freight to delivery, see our guide to shipping from China to Australia.
Can you still claim ChAFTA after the goods arrive?
Yes, but only within 12 months. If you paid the general rate because a valid ChAFTA certificate of origin was not available at the time, you can apply for a refund once you hold one. The claim must be made within 12 months of the date of shipment. After that, the ChAFTA concession can no longer be claimed.
Key takeaways
- Not automatic: ChAFTA must be claimed, and the claim must be supported by proof of origin.
- Origin, not route: Goods qualify because of where they were made, not where they were shipped from.
- The right document: Ask for a ChAFTA certificate of origin, not a general statement of origin.
- Validity: A certificate covers one shipment and is valid for 12 months from issue.
- Low-value shipments: No proof is needed for originating goods worth AUD 1,000 or less.
Official Resources and Regulatory Compliance
- Department of Foreign Affairs and Trade (DFAT), ChAFTA certificates of origin: DFAT sets out who issues ChAFTA certificates and declarations of origin and how long they are valid. ChAFTA and certificates of origin
- DFAT, guide to using ChAFTA: DFAT explains the rules of origin, documents and refund options for goods traded under ChAFTA. Guide to using ChAFTA to export or import
- DFAT, ChAFTA rules of origin: Chapter 3 of the agreement sets the legal rules of origin and proof of origin requirements. ChAFTA Chapter 3
- Australian Border Force (ABF), ChAFTA instructions and guidelines: The ABF sets out importers’ obligations when claiming the ChAFTA preference. ChAFTA instructions and guidelines
- DFAT, FTA Portal: The FTA Portal shows the tariff rate and rule of origin for a product under each of Australia’s free trade agreements. FTA Portal
How Kenneth Lloyd Global helps importers claim ChAFTA
Kenneth Lloyd Global (KLG) has 25 years’ experience in global logistics, with foundations in customs brokerage and compliance. A ChAFTA claim is only as good as the classification, origin check and certificate behind it.
- Licensed and accredited: KLG holds a customs broker licence and Australian Trusted Trader accreditation, and is a member of the Freight and Trade Alliance.
- Origin and classification checks: KLG reviews free trade agreement eligibility and provides tariff classification advice before the goods ship.
- China network: KLG has a network across Shanghai, Ningbo, Shenzhen, Qingdao, Tianjin, Xiamen, Guangzhou, Dalian and Foshan, so documents can be checked close to your supplier.
- Refunds: KLG prepares refund applications where duty was paid but ChAFTA could have been claimed.
Check if your goods qualify for ChAFTA
Not sure whether your goods qualify for ChAFTA, or whether you have paid duty you could have avoided? Send through your product details, supplier invoice and any certificate of origin, and KLG will check your eligibility before your next shipment.
Call Chris Ciantar, Managing Director, on +61 412 983 265 or email chris@kennethlloyd.com.au. Chris is available after hours and on weekends. You can also send your details through the KLG contact form.
Frequently asked questions
What is a ChAFTA certificate of origin?
A ChAFTA certificate of origin is a document issued in China that proves goods originate there under the China-Australia Free Trade Agreement. It is issued by the General Administration of Customs of China or the China Council for the Promotion of International Trade, covers one shipment, and is valid for 12 months.
Are all goods from China duty free under ChAFTA?
No. The ChAFTA rate for most goods is now nil, but only goods that originate in China under the agreement’s rules of origin qualify. Goods made in another country and shipped from China do not qualify, and the claim must be supported by a valid certificate of origin for shipments over AUD 1,000.
Do I need a certificate of origin for every shipment?
Yes, for shipments where the customs value of the originating goods is more than AUD 1,000. Each certificate covers one shipment and up to 20 goods. Below AUD 1,000, no proof of origin is needed, unless the order has been split into smaller shipments to avoid the requirement.
Can I claim a refund if I didn’t use ChAFTA?
Yes, but only within 12 months. If you paid the general rate of duty because you did not have a valid ChAFTA certificate of origin at the time, you can apply for a refund once you hold one. The claim must be made within 12 months of the date of shipment. After that, the concession can no longer be claimed.