WORLD TRADE  
ORGANIZATION  G/RO/W/121 
3 September 2008 
 (08-4135) 
Committee on Rules of Origin Original:   English 
  
 
DRAFT CONSOLIDATED TEXT OF NON-PREFERENTIAL RULES OF ORIGIN 
 
Harmonization Work Programme
 
 
Communication from Australia 
 
  The following communication, dated 27 Augus t 2008, has been received from the Delegation 
of Australia.  
_______________ 
 
 
AUSTRALIA’S COMMENTS ON G/RO/W111/Rev.2 
DRAFT CONSOLIDATED TEXT OF NON-PREFERENTIAL 
RULES OF ORIGIN 
 
 
A. G
ENERAL RULES  
1. General Rule 6: Minimal Operations and Processes 
 Australia proposes the followi ng wording for this rule:  
 
“Operations or processes undertaken, by themselv es or in combination with each other for the 
purposes listed below, are considered to be minimal and shall not be taken into account in determining 
the origin of a good:  
 
(i) ensuring preservation of goods in  good condition for the purposes of transport or storage;  
(ii) facilitating shipment or transportation;  
(iii) packaging or presenting goods for sale.”  
B. APPENDIX 1 – WHOLLY OBTAINED GOODS  
2. Rule 1: Scope of Application 
 In order to clarify what is meant by “outside a country”, i.e. beyond an EEZ or area of 
fisheries jurisdiction in the case of definition 2( a) and beyond areas of the continental shelf over 
which a country exercises jurisdiction in the case of definition 2(c), Australia proposes the following 
amendments:  G/RO/W/121 
Page 2  
 
   Definition 2(a): “Products of sea-fishing and ot her products taken from the sea outside an area 
over which  a country exercises jurisdiction  are considered to be wholly obtained in the country whose 
flag the vessel that carries out th ose operations is entitled to fly.” 
 
 Definition 2(c): “Products taken from the sea be d or subsoil beneath the sea bed outside an 
area over which  a country exercises jurisdiction , are considered to be wholly obtained in the country 
that has the rights to exploit that sea bed or s ubsoil in accordance with the provisions of the UN 
Convention on the Law of the Sea.”  
 
C. APPENDIX 2 – PRODUCT SPECIFIC RULES OF ORIGIN  
3. Rule 1: Scope of Application 
 In order to achieve harmonised rules, Austra lia prefers to have one set of rules based on a 
change in tariff classification (CTC), i.e. the rules contained in column 3, for conferring of origin on 
goods in Chapters 84 to 90 and in Chapter 92.  
 Australia supports CTC rules because they are an objective and consistent measure of 
substantial transformation.  Austra lia only supports value added rules in very few circumstances, e.g. 
embroidery, where other rules are impractical. Value- add rules can result in varied outcomes.  They 
rely on calculations based on cost data, are less transparent and are affected by exchange rate 
fluctuations.  This means that goods may originate in a country sometimes but not at others, despite 
identical materials and processes being used.  Add itionally, under value adde d rules outcomes depend 
greatly on a country’s level of economic development.  Higher wage  rates and other supply costs in 
developed countries make it easier for them to meet  value added rules.  Finally, value added rules 
discourage productivity improvements, as reductions  in overheads and wages per unit could reduce 
the proportion of value add to below the nominated threshold.  
  
4. Chapter 1 
 0101.19, 0102.90, 0103.92, 01.04, 01.05 and ex01.06(a):  Australia does not consider the 
fattening of animals to be a substantial transforma tion.  Furthermore, the criteria for substantial 
transformation should not vary according to the wei ght or breed of an animal.  Origin should be 
determined solely by the country where the animal  was born.  Propose “The origin shall be country 
where the animal was born”.  5. Chapter 2 
 ex02.09(a) and ex02.10(a):  Australia does not consider the drying of meat to represent a 
substantial transformation. Propose “CC”.  
 ex02.10(b) and ex02.10(c):  Australia proposes “CC”. 
 
6. Chapter 3 
 ex03.04(b):  this wholly obtained rule should re fer to “split heading” ra ther than “heading”.  
 
 ex03.05(a) and ex03.05(b):  Australia does not consider the process of drying, salting or smoking of fish to be a substantial transformation.  Propose “The origin shall be the country where the 
fish of this split heading have been captured; or if  farmed, the country where the fish has been raised 
from egg or fry (including fingerling)”.    ex03.06(b) and 03.06(c):  Australia proposes “CC”.   G/RO/W/121 
 Page 3 
 
 
   
7. Chapter 4 
 04.02:  Australia does not support this ROO as it allows for further processing without 
conferring origin.  Propose “CTH”.  
 ex04.06(b): this ROO would confer origin thr ough grating cheese. Australia does not consider 
the process of grating to be a substantial tran sformation.  Propose removing the split for heading 
04.06 and applying “CTH”.   
8. Chapter 7 
 ex07.12(b):  Australia does not consider the dr ying of vegetables to be origin conferring. 
Propose “CC”.   07.14:  Australia proposes “The origin shall be the country where the goods of this heading 
grew”. 
 
9. Chapter 9 
 ex09.10(a):  Australia proposes “The origin shall be the country where the plant grew”.  
 
10. Chapter 15 
 15.01 and 15.02:  a CTH rule would confer origin by merely removing fat from a meat cut. 
Australia does not consider this to represent a s ubstantial transformation.  Propose “CC, except from 
Chapter 2”.   15.03 – 15.14:  Australia proposes “CC”.   
 15.15:  Australia proposes removing the split from 15.15 and applying “CTH”. 
  ex1517.90(a):  Australia proposes “CC”.   15.18:  Australia does not consider the process of boiling or dehydrating to represent a substantial transformation. Propose subheading rules as follows: 
 
15.18 Animal or vegetable fats, etc. As specified for split headings 
15.18(a) Boiled and dehydrated CC 
15.18(b) Other CTH, or by change in chemical reaction 
  
 15.21:  Australia proposes removing the split from this heading and applying a “CC” rule to 
this heading. 
 
 15.22:  Australia proposes “CC”. 
 
11. Chapter 16 
 16.02:  Australia proposes “CC, subject to Chapter Note”. 
 
 16.03:  Australia proposes “CC”.  G/RO/W/121 
Page 4  
 
   16.04:  Australia does not consider the preparation or preservation of fish to represent a 
substantial transformation. In the c ase of caviar, origin should be c onferred on the place of origin of 
the fish roe.  Propose “The origin shall be the c ountry where the fish of this heading have been 
captured;  or if farmed, the country where the fish has been raised from egg or fry (including fingerling)”. 
 
 16.05:  Australia does not consider the prepara tion or preservation of the items in this heading 
to represent a substantial transformation.  Propose “T he origin shall be the country where the animals 
of this heading have been captured or gathered”. 
 
12. Chapter 17 
 17.01:  Australia considers the refining of raw sugar to represent a substantial transformation.  
Propose a split heading rule be used to recogni se the difference between cane/beet sugar and 
chemically processed sucrose (i.e. table sugar), and th at a ‘chemical reaction’ test be included in the 
chapter notes similar to the test app lied to 15.16 and 15.18 as follows:  
 
17.01 Cane or beet sugar, etc. As specified for split headings 
ex17.01(a) Cane or beet sugar The origin shall be country where the cane 
or beet sugar of this heading is extracted in its natural or unprocessed state. 
ex17.01(b) Chemically pure sucrose, in solid form CTHS, or change by chemical reaction. 
 
 ex17.02(b):  Australia proposes “CTH”. 
  17.03:  in order to confer origin from 17.01, Australia proposes “CTH”.   
13. Chapter 19 
 1902.20:  Australia does not consider the stuffing of pasta to represent a substantial 
transformation. Propose “CTH”.   19.03 and 19.04:  Australia proposes “CC”.  
14. Chapter 20 
 20.01 – 20.03, ex2008.11(a), 2008.20 – 2008.91, 2008.99 and 2009.40 – 2009.90: Australia 
proposes “CC”.  
15. Chapter 21 
 21.01 and 21.02: Australia proposes “CC”.  
 16. Chapter 22 
 22.03:  Australia proposes “CC”. 
  2204.10 – 2204.29: Australia proposes “CTH, except from Chapter 8”.  17. Chapter 23 
 23.01 – 23.08: Australia proposes “CC”.  G/RO/W/121 
 Page 5 
 
 
   
 ex2309.90(a):   Australia proposes removing the split from this subheading and applying 
“CTH” for heading 23.09. 
 
18. Chapter 32 
 Chapter Note 2(b):  Mixtures and Blends:  Au stralia does not support dilution as conferring 
origin. 
 
19. Chapter 35 
 3501.10, 3502.20, 35 02.90 and 3505.1: Australia proposes “CTSH”.   
 
20. Chapter 39 
 Chapter Note 2(b):  Australia does not understa nd the reason for this chapter note.  More 
information on this provision would be useful in helping us understand the chapter note and respond. 
  3926.20:  Australia does not support assembly in either a single or multiple countries as origin 
conferring.  Propose “CTH”. 
 
21. Chapter 40 
 4001.21:  Australia proposes “CTSH”.  
 
22. Chapter 42 
 Chapter Note 1 – Minor processi ng operations not affecting origin:  This chapter note should 
apply to all goods in Chapter 42.  Australia proposes:   “For the purposes of determining the country of origin for goods in Chapter 42
 that are not wholly 
obtained in one country, the following individual pr ocesses, considered singly, are minimal operations 
and shall not affect the origin of  the goods concerned, whether or not such processes result in changes 
of classification:  
(a) Working or finishing one or more edges by hemming, rolling, whipping or similar means 
or by knotting fringe; 
(b) Cutting fabrics, yarns or other materials; or separating goods produced in the finished 
state by cutting along dividing threads; 
(c) Assembling or joining goods by sewing or s titching for convenience of shipment or other 
temporary purposes; or 
(d) Putting up goods for retail sale or in sets or ensembles.” 
 
 42.02 and 42.03: Australia does not support asse mbly in either a single or multiple countries 
as origin conferring. Propose “CTH”.  
 
23. Chapter 43 
 Chapter Note 1 – Minor processing operations not  affecting origin:  this chapter note should 
apply to all goods in Chapter 43. Australia proposes: G/RO/W/121 
Page 6  
 
   
“For the purposes of determining the country of origin for goods in Chapter 43
 that are not wholly 
obtained in one country, the following individual pr ocesses, considered singly, are minimal operations 
and shall not affect the origin of  the goods concerned, whether or not such processes result in changes 
of classification: 
 
(a) Working or finishing one or more edges by hemming, rolling, whipping or similar means 
or by knotting fringe; 
(b) Cutting fabrics, yarns or other materials; or separating goods produced in the finished 
state by cutting along dividing threads; 
(c) Assembling or joining goods by sewing or s titching for convenience of shipment or other 
temporary purposes; or 
(d) Putting up goods for retail sale or in sets or ensembles.” 
  43.02 and 43.04: Australia proposes removing the split from these headings and applying 
“CTH”. 
 
24. Chapter 50 
 50.04 and 50.05:  Australia proposes removi ng the split from these headings and applying 
“CTH, except from heading 50.06;  or the origin sha ll be the country where yarn that is constructed 
but not further prepared or finished is dyed or printed and undergoes all subsequent finishing 
processes”. 
  50.06:  Australia proposes removing the split from this heading and applying “CTH, except 
from heading 50.04 and 50.05;  or the origin shall be the country where yarn that is constructed but 
not further prepared or finished is dyed or prin ted and undergoes all subsequent finishing processes”. 
 
 50.07:  Australia proposes removing the split from this heading and applying “CTH;  or the 
origin shall be the country where yarn that is constr ucted but not further prepared or finished is dyed 
or printed and undergoes all s ubsequent finishing processes”. 
 
25. Chapter 51 
 51.05:  Australia does not consider the carding or  combing of wool to be origin conferring. 
Propose “CC”.    51.06, 51.07 and 51.08:  Australia proposes removing the split from these headings and 
applying “CTH, except from heading 51.09;  or the or igin shall be the countr y where yarn that is 
constructed but not further prepared or finished is dyed or printed and undergoes all subsequent 
finishing processes”. 
 
 51.09:  Australia proposes removing the split from this heading and applying “CTH, except 
from headings 51.06 to 51.08;  or the origin shall be the country where yarn that is constructed but not 
further prepared or finished is dyed or printe d and undergoes all subse quent finishing processes”. 
 
 51.10, 51.11, 51.12 and 51.13:  Australia pr oposes removing the split from these headings and 
applying “CTH;  or the origin shall be the country  where yarn that is constructed but not further 
prepared or finished is dyed or printed a nd undergoes all subsequent finishing processes”. 
  G/RO/W/121 
 Page 7 
 
 
  26. Chapter 52 
 52.04, 52.05, 52.08, 52.09, 52.10, 52.11 a nd 52.12:  Australia proposes removing the split 
from these headings and applying “CTH;  or the or igin shall be the country where yarn that is 
constructed but not further prepared or finished is dyed or printed and undergoes all subsequent 
finishing processes”. 
 
 ex52.06(a):  an explanation of core spinning would be useful.   52.07:  Australia proposes removing the split from this heading and applying “CTH, except 
from headings 52.05 or 52.06;  or the origin shall be the country where yarn that is constructed but not 
further prepared or finished is dyed or printe d and undergoes all subse quent finishing processes”. 
 
27. Chapter 53 
 53.06, 53.07, 53.08, 53.09, 53.10 and 53.11:  Australia proposes removing the split from these 
headings and applying “CTH;  or the origin shall be  the country where yarn that is constructed but not 
further prepared or finished is dyed or printe d and undergoes all subse quent finishing processes”. 
 
28. Chapter 54 
 54.01, 54.07 and 54.08:  Australia proposes removing the split from these headings and 
applying “CTH;  or the origin shall be the country  where yarn that is constructed but not further 
prepared or finished is dyed or printed a nd undergoes all subsequent finishing processes”. 
 
 54.02, 54.03, 54.04 and 54.05:  Australia pr oposes removing the split from these headings and 
applying “CTH, except from heading 52.06;  or the or igin shall be the countr y where yarn that is 
constructed but not further prepared or finished is dyed or printed and undergoes all subsequent 
finishing processes”.  
 54.06:  Australia proposes removing the split from this heading and applying “CTH, except 
from heading 52.02 through 52.05;  or the origin sha ll be the country where yarn that is constructed 
but not further prepared or finished is dyed or printed and undergoes all subsequent finishing processes”.  
 
29. Chapter 55 
 55.01 and 55.02:  Australia proposes “CTH”. 
 
 55.03, 55.04, 55.06 and 55.07:  Australia proposes “CC”. 
 
 55.08, 55.12, 55.13, 55.14, 55.15 and 55.16:  Australia proposes removing the split from these 
headings and applying “CTH;  or the origin shall be  the country where yarn that is constructed but not 
further prepared or finished is dyed or printe d and undergoes all subse quent finishing processes”. 
  55.09 and 55.10:   Australia proposes removing the split from these headings and applying 
“CTH, except from heading 55.11;  or the origin sha ll be the country where yarn that is constructed 
but not further prepared or finished is dyed or printed and undergoes all subsequent finishing 
processes”. 
 
 55.11:  Australia proposes removing the split from this heading and applying “CTH, except 
from headings 55.09 or 55.10;  or the origin shall be the country where yarn that is constructed but not 
further prepared or finished is dyed or printe d and undergoes all subse quent finishing processes”. G/RO/W/121 
Page 8  
 
   
30. Chapter 56 
 56.02 and 56.03:  Australia proposes removi ng the split from these headings and applying 
“CTH;  or the origin shall be the country where yarn that is constructed but not further prepared or 
finished is dyed or printed and underg oes all subsequent finishing processes”. 
 31. Chapter 57 
 57.02 and 57.03:  Australia proposes removi ng the split from these headings and applying 
“CTH”.  
 
32. Chapter 58 
 58.01 – 58.04, 58.06 and 58.09:  Australia  proposes removing the split from these headings 
and applying “CTH;  or the origin shall be the count ry where yarn that is constructed but not further 
prepared or finished is dyed or printed a nd undergoes all subsequent finishing processes”. 
 
 58.07, 58.08, 58.10 and 58.11:  Australia pr oposes removing the split from these headings and 
applying “CTH”. 
 
33. Chapter 59 
 59.03, 59.05, 59.07 and 59.11:  Australia pr oposes removing the split from these headings and 
applying “CTH”.  34. Chapter 60 
 60.01 and 60.02:  Australia proposes removi ng the split from these headings and applying 
“CTH;  or the origin shall be the country where yarn that is constructed but not further prepared or 
finished is dyed or printed and underg oes all subsequent finishing processes”. 
 35. Chapter 61 
 Chapter Note 2 – Assembly in a single count ry – and Chapter Residual Rule: Australia does 
not support assembly only as origin conferring.    Australia proposes removing all splits in this ch apter and applying a “CC” rule at the chapter 
level. 
 
36. Chapter 62 
 Chapter Note 2 – Assembly in a single country  – Chapter Residual Rule:  Australia does not 
support assembly only as origin conferring.   
 
 Australia proposes removing all splits in this ch apter and applying a “CC” rule at the chapter 
level. 
 
37. Chapter 63 
 63.01 and 63.02:  Australia proposes removi ng the split from these headings and applying 
“CTH, provided that where the starting material is fabric, the fabric is c onstructed but not further 
prepared or finished”.   G/RO/W/121 
 Page 9 
 
 
   
 63.03, 63.04 and 63.05:  Australia proposes “CTH , provided that where the starting material 
is fabric, the fabric is constructed but not further prepared or finished”.  
 
 63.07:  Australia proposes removing the split from this heading and applying “CTH, except 
by cutting only”. 
  63.08:  Australia proposes “CTH”. 
 
38. Chapter 64 
 64.01 – 64.05:  Australia proposes “CTH”. 
  64.06:  Australia proposes removing the sp lit from this heading and applying “CTH”.  
 
39. Chapter 70 
 70.10 and 70.13:  Australia proposes removi ng the split from these headings and applying 
“CTH”.   7019.52 and 7019.59:  Au stralia proposes “CTSH”. 
 
40. Chapter 72 
 ex72.10(b) and ex72.10(d):  Australia proposes “CTH”. 
 
 ex72.16(a):  Australia proposes “CTH, excep t from headings 72.09, 72.10, ex72.11(b) and 
72.12 to 72.15”.  
 ex72.19(d):  Australia proposes “CTH, except from heading 72.20”. 
  ex72.20(d):  Australia proposes “CTH, except from heading 72.19”.   ex72.22(f):  Australia proposes the same ru le as ex722.22(e) “CTH, except from heading 
72.21”. 
 
 ex72.25(d):  Australia proposes “CTH, except from heading 72.26”.   ex7228(e):  Australia proposes “CTH, except from heading 72.27”.  
 
41. Chapter 73 
 Chapter Notes 1 and 2: It is unclear what is  considered to be “simple assembly operations”. 
Once the text explaining “simple assembly operation s” has been drafted, Australia will comment.  
 
42. Chapter 74 
 74.08:  Australia proposes a simpler rule - “CTH, except from 7407”. 
 
43. Chapter 75 
 7505.21 and 7505.22:  Australia proposes simpler rules - “CTH”. 
 G/RO/W/121 
Page 10  
 
  44. Chapter 76 
 7605:  Australia proposes a simpler rule - “CTH, except from 76.04”. 
  76.07:  Australia proposes removing the split from this heading and applying a simpler rule - 
“CTH”. 
 
 76.08:  Australia proposes a simpler rule - “CTH”.   7616.91:  Australia proposes “CTSH”.  45. Chapter 78 
 78.03:  Australia proposes removing the split from this heading and applying a simpler rule - 
“CTH”.  
46. Chapter 79 
 79.04 and 79.07:  Australia proposes removi ng the split from these headings and applying 
simpler rules - “CTH”. 
 
47. Chapter 80 
 80.03:   Australia proposes removing the split from this heading and applying a simpler rule - 
“CTH”. 
 
48. Chapters 84-90 
 Australia proposes one set of ROO and supports the CTC rules in column 3. 
  ex84.73(b):  Australia proposes “CTH” and removing the subsidiary rule. 
  
 84.83:  Australia proposes removing the subsidiary rule.    85.41 and 85.42:  Australia supports the original wording in column 3 rule from G/RO/W111 - “The country of origin of a good of th is heading shall be the country of diffusion”. 
 49. Chapters 91-97 
 Criterion to apply Appendix 2, Rule 3(f): th e reference to Appendix 2, Rule 3(f) does not 
seem to be required as the concept app ears to apply to all chapters.   
 
50. Chapter 95 
 9502.91:  Australia does not support assembly in either single or multiple countries as origin 
conferring.  Propose “CTH”.  
9502.99:  Australia proposes “CTH”.  
51. Chapter 97 
 9701.90:  Australia proposes “CTSH”. 
   G/RO/W/121 
 Page 11 
 
 
   97.02 and 97.03:  Australia proposes a “CTH” rule without a residual rule. 
 
 97.04 and 97.05:  Australia proposes removi ng the split from these headings and applying 
“CTH”.   
 97.06:  Australia proposes “CTH”. 
  
___________