1. Signed: 27 February 2009
2. Effective date: 01 January 2010
3. Purpose: This is a comprehensive Agreement with the goal of strengthening the deep connection between the two regions through measures to eliminate all types of tariff barriers, facilitate trade, investment and economic cooperation programs, technical assistance.
4. Coverage: goods and services (including financial and telecommunications services), investment, e-commerce, movement of natural persons, intellectual property, competition policy and economic cooperation.
5. General overview
The AANZFTA is a comprehensive and single-undertaking free trade agreement that opens up and creates new opportunities for approximately 663 million peoples of ASEAN, Australia and New Zealand - a region with a combined Gross Domestic Product of approximately USD 4 trillion as of 2016. In line with the ASEAN Community Vision 2025 , the AANZFTA aims for sustainable economic growth in the region by providing a more liberal, facilitative and transparent market and investment regimes among the twelve signatories to the Agreement.
Through the AANZFTA:
- tariffs will be progressively reduced from entry into force of the Agreement, and eliminated for at least 90% of all tariff lines within specified timelines;
- movement of goods will be facilitated via a more modern and flexible rules of origin, simplified customs procedures, and more transparent mechanisms;
- barriers to trade in services will be progressively liberalised allowing for greater market access to service suppliers in the region;
- movement of business persons, those engaged in trade and investment activities, will be facilitated; and
- covered investments will be accorded a range of protection, including the possibility of dealing with disputes via an investor-state dispute settlement mechanism.
6. Revision versions:
(i) First time:
In August 2014, revised two Chapters, Trade in Goods and Rules of Origin, as well as the annexes on Certification Procedures to streamline certification processes to facilitate the movement of goods and Regulations. product specific rules (PSR) to incorporate a unified PSR.
(ii) Second time:
On 21 August 2023, on the sidelines of the ASEAN - Australia - New Zealand Economic Ministers Meeting (AANZFTA) held in Semarang, Indonesia, the Economic Ministers from Brunei Darussalam (ASEAN National Coordinator on AANZFTA) and Indonesia (ASEAN Chair 2023), together with Australia and New Zealand, signed the 2nd Protocol amending the Agreement establishing the ASEAN-Australia-New Zealand Free Trade Area (referred to as the 2nd Protocol). The remaining ASEAN member states will sign the Second Protocol at the appropriate time.
Under the Second Protocol, 13 Chapters in the original AANZFTA – including Rules of Origin, Customs Procedures and Facilitation of Trade, Investment, Competition and Consumer Protection, E-commerce has be upgraded. Three new Chapters, namely Government Procurement, Micro, Small and Medium Enterprises (MSME), Trade and Sustainable Development, as well as new provisions on educational services in the Trade in Services Chapter has also been added. This meets the needs of businesses to make AANZFTA more efficient and easier to trade in order to reduce transaction costs.
The upgrade also includes elements to strengthen supply chain resiliency, promote the use of digital technology, strengthen cooperation on trade and sustainability, and ensure the flow of money. Essential goods flow more smoothly, especially in crisis situations.
Economic cooperation will continue to play an important role in ensuring that, through technical cooperation and capacity-building initiatives, ASEAN Member States – especially the least developed members - be able to promptly fulfill the commitments and obligations they have made.
MSMEs will benefit most from economic cooperation programs that promote the use of technology, including supporting digital transformation and innovative start-ups, helping MSMEs seize opportunities in new areas, such as green economy and capacity building of MSMEs to maximize opportunities from FTAs and take advantage of FTAs.