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An attractive benefit of Australia's Trusted Trader Programme is the origin waiver benefit. Under this benefit importers can claim the preferential rates under certain free trade agreements (FTA) without needing to produce a certificate of origin (COO). Sounds great, but it is important that the benefit is only used where you are certain that the goods qualify under the FTA.

Despite the name, the origin waiver benefit does not remove that need for the goods to satisfy the rules of origin. Rather, all that is removed is the need to produce a COO. In some ways this places a much higher compliance burden on the importer. When an importer receives a COO it has prima facie proof from a government body that the goods qualify for the free trade agreement. Take this away and the importer is relying only on claims by the exporter.

If audited by the Australian Border Force, the easiest way to prove compliance with an FTA is to produce a COO. If using the origin waiver benefit how will you prove that the goods qualify? It is not enough to simply remove the COO, the importer should obtain some other objective evidence of compliance. This may be a declaration of origin from the manufacturer.

It is important for any importer using the origin waiver benefit to have systems in place to monitor compliance with the rules of origin. Compliance should be reviewed any time there is a new product, change in the manufacturer of the product or change in materials used to produce the product.

It is also important to ask why the exporter may be finding it difficult to supply a COO. Issues relating to the cost and expense of obtaining COOs are acceptable reasons. However, complaints that rules of origin are too difficult or there are difficulties with the issuing authority should ring alarm bells.

The origin waiver benefit promises fantastic trade facilitation benefits, However, the benefits come with increased compliance burden. Traders should not use the origin waiver benefit unless they are prepared to take on this burden

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