H. R. 4759—17 
(B) INVENTORY
MANAGEMENT
METHOD.—In this sub-
section, the term ‘‘inventory management method’’ means— 
(i) averaging; 
(ii) ‘‘last-in, first-out’’; 
(iii) ‘‘first-in, first-out’’; or 
(iv) any other method— 
(I) recognized in the generally accepted 
accounting principles of the country in which the 
production is performed (whether Australia or the 
United States); or 
(II) otherwise accepted by that country. 
(2) ELECTION OF INVENTORY METHOD.—A person selecting 
an inventory management method under paragraph (1) for 
a particular fungible good or fungible material shall continue 
to use that method for that fungible good or fungible material 
throughout the fiscal year of that person. 
(i) PACKAGING MATERIALS AND CONTAINERS FOR RETAIL SALE.— 
Packaging materials and containers in which a good is packaged 
for retail sale, if classified with the good, shall be disregarded 
in determining whether all the nonoriginating materials used in 
the production of the good undergo the applicable change in tariff 
classification set out in Annex 4–A or Annex 5–A of the Agreement, 
and, if the good is subject to a regional value-content requirement, 
the value of such packaging materials and containers shall be 
taken into account as originating or nonoriginating materials, as 
the case may be, in calculating the regional value-content of the 
good. 
(j) PACKING MATERIALS
AND CONTAINERS
FOR SHIPMENT.— 
Packing materials and containers for shipment shall be disregarded 
in determining whether— 
(1) the nonoriginating materials used in the production 
of a good undergo the applicable change in tariff classification 
set out in Annex 4–A or Annex 5–A of the Agreement; and 
(2) the good satisfies a regional value-content requirement. 
(k) INDIRECT MATERIALS.—An indirect material shall be treated 
as an originating material without regard to where it is produced, 
and its value shall be the cost registered in the accounting records 
of the producer of the good. 
(l) THIRD COUNTRY OPERATIONS.—A good that has undergone 
production necessary to qualify as an originating good under sub-
section (b) shall not be considered to be an originating good if, 
subsequent to that production, the good undergoes further produc-
tion or any other operation outside the territory of Australia or 
the United States, other than unloading, reloading, or any other 
operation necessary to preserve the good in good condition or to 
transport the good to the territory of Australia or the United States. 
(m) TEXTILE AND APPAREL GOODS CLASSIFIABLE AS GOODS PUT 
UP IN SETS.—Notwithstanding the rules set forth in Annex 4– 
A of the Agreement, textile or apparel goods classifiable as goods 
put up in sets for retail sale as provided for in General Rule 
of Interpretation 3 of the HTS shall not be considered to be origi-
nating goods unless each of the goods in the set is an originating 
good or the total value of the nonoriginating goods in the set 
does not exceed 10 percent of the value of the set determined 
for purposes of assessing customs duties. 
(n) DEFINITIONS.—In this section:
H. R. 4759—18 
(1) ADJUSTED VALUE.—The term ‘‘adjusted value’’ means 
the value determined under Articles 1 through 8, Article 15, 
and the corresponding interpretive notes of the Agreement on 
Implementation of Article VII of the General Agreement on 
Tariffs and Trade 1994 referred to in section 101(d)(8) of the 
Uruguay Round Agreements Act, adjusted to exclude any costs, 
charges, or expenses incurred for transportation, insurance, 
and related services incident to the international shipment 
of the good from the country of exportation to the place of 
importation. 
(2) CLASS OF MOTOR VEHICLES.—The term ‘‘class of motor 
vehicles’’ means any one of the following categories of motor 
vehicles: 
(A) Motor vehicles provided for in subheading 8701.20, 
8704.10, 8704.22, 8704.23, 8704.32, or 8704.90, or heading 
8705 or 8706, or motor vehicles for the transport of 16 
or more persons provided for in subheading 8702.10 or 
8702.90. 
(B) Motor vehicles provided for in subheading 8701.10 
or any of subheadings 8701.30 through 8701.90. 
(C) Motor vehicles for the transport of 15 or fewer 
persons provided for in subheading 8702.10 or 8702.90, 
or motor vehicles provided for in subheading 8704.21 or 
8704.31. 
(D) Motor vehicles provided for in any of subheadings 
8703.21 through 8703.90. 
(3) FUNGIBLE
GOOD
OR
FUNGIBLE
MATERIAL.—The term 
‘‘fungible good’’ or ‘‘fungible material’’ means a good or material, 
as the case may be, that is interchangeable with another good 
or material for commercial purposes and the properties of which 
are essentially identical to such other good or material. 
(4) GENERALLY
ACCEPTED
ACCOUNTING
PRINCIPLES.—The 
term ‘‘generally accepted accounting principles’’ means the rec-
ognized consensus or substantial authoritative support in the 
territory of Australia or the United States, as the case may 
be, with respect to the recording of revenues, expenses, costs, 
assets, and liabilities, the disclosure of information, and the 
preparation of financial statements. These standards may 
encompass broad guidelines of general application as well as 
detailed standards, practices, and procedures. 
(5) GOOD
WHOLLY
OBTAINED
OR
PRODUCED
ENTIRELY
IN 
THE TERRITORY OF AUSTRALIA, THE UNITED STATES, OR BOTH.— 
The term ‘‘good wholly obtained or produced entirely in the 
territory of Australia, the United States, or both’’ means— 
(A) a mineral good extracted in the territory of Aus-
tralia, the United States, or both; 
(B) a vegetable good, as such goods are provided for 
in the HTS, harvested in the territory of Australia, the 
United States, or both; 
(C) a live animal born and raised in the territory 
of Australia, the United States, or both; 
(D) a good obtained from hunting, trapping, fishing, 
or aquaculture conducted in the territory of Australia, the 
United States, or both;
H. R. 4759—19 
(E) a good (fish, shellfish, and other marine life) taken 
from the sea by vessels registered or recorded with Aus-
tralia or the United States and flying the flag of that 
country; 
(F) a good produced exclusively from products referred 
to in subparagraph (E) on board factory ships registered 
or recorded with Australia or the United States and flying 
the flag of that country; 
(G) a good taken by Australia or the United States 
or a person of Australia or the United States from the 
seabed or beneath the seabed outside territorial waters, 
if Australia or the United States has rights to exploit 
such seabed; 
(H) a good taken from outer space, if such good is 
obtained by Australia or the United States or a person 
of Australia or the United States and not processed in 
the territory of a country other than Australia or the United 
States; 
(I) waste and scrap derived from— 
(i) production in the territory of Australia, the 
United States, or both; or 
(ii) used goods collected in the territory of Aus-
tralia, the United States, or both, if such goods are 
fit only for the recovery of raw materials; 
(J) a recovered good derived in the territory of Aus-
tralia or the United States from goods that have passed 
their life expectancy, or are no longer usable due to defects, 
and utilized in the territory of that country in the produc-
tion of remanufactured goods; or 
(K) a good produced in the territory of Australia, the 
United States, or both, exclusively— 
(i) from goods referred to in any of subparagraphs 
(A) through (I), or 
(ii) from the derivatives of goods referred to in 
clause (i), 
at any stage of production. 
(6) INDIRECT
MATERIAL.—The term ‘‘indirect material’’ 
means a good used in the production, testing, or inspection 
of a good but not physically incorporated into the good, or 
a good used in the maintenance of buildings or the operation 
of equipment associated with the production of a good, 
including— 
(A) fuel and energy; 
(B) tools, dies, and molds; 
(C) spare parts and materials used in the maintenance 
of equipment or buildings; 
(D) lubricants, greases, compounding materials, and 
other materials used in production or used to operate equip-
ment or buildings; 
(E) gloves, glasses, footwear, clothing, safety equip-
ment, and supplies; 
(F) equipment, devices, and supplies used for testing 
or inspecting the good; 
(G) catalysts and solvents; and 
(H) any other goods that are not incorporated into 
the good but the use of which in the production of the
H. R. 4759—20 
good can reasonably be demonstrated to be a part of that 
production. 
(7) MATERIAL.—The term ‘‘material’’ means a good that 
is used in the production of another good. 
(8) MATERIAL THAT IS SELF-PRODUCED.—The term ‘‘material 
that is self-produced’’ means an originating material that is 
produced by a producer of a good and used in the production 
of that good. 
(9) MODEL LINE.—The term ‘‘model line’’ means a group 
of motor vehicles having the same platform or model name. 
(10) NONALLOWABLE INTEREST COSTS.—The term ‘‘nonallow-
able interest costs’’ means interest costs incurred by a producer 
that exceed 700 basis points above the applicable official 
interest rate for comparable maturities of the country (whether 
Australia or the United States). 
(11) NONORIGINATING MATERIAL.—The term ‘‘nonoriginating 
material’’ means a material that does not qualify as originating 
under this section. 
(12) PREFERENTIAL
TREATMENT.—The term ‘‘preferential 
treatment’’ means the customs duty rate, and the treatment 
under article 2.12 of the Agreement, that are applicable to 
an originating good pursuant to the Agreement. 
(13) PRODUCER.—The term ‘‘producer’’ means a person who 
engages in the production of a good in the territory of Australia 
or the United States. 
(14) PRODUCTION.—The term ‘‘production’’ means growing, 
raising, mining, harvesting, fishing, trapping, hunting, manu-
facturing, processing, assembling, or disassembling a good. 
(15) REASONABLY ALLOCATE.—The term ‘‘reasonably allo-
cate’’ means to apportion in a manner that would be appropriate 
under generally accepted accounting principles. 
(16) RECOVERED
GOODS.—The term ‘‘recovered goods’’ 
means materials in the form of individual parts that result 
from— 
(A) the complete disassembly of goods which have 
passed their life expectancy, or are no longer usable due 
to defects, into individual parts; and 
(B) the cleaning, inspecting, or testing, or other proc-
essing that is necessary for improvement to sound working 
condition of such individual parts. 
(17) REMANUFACTURED GOOD.—The term ‘‘remanufactured 
good’’ means an industrial good that is assembled in the terri-
tory of Australia or the United States, that is classified under 
chapter 84, 85, or 87 of the HTS or heading 9026, 9031, or 
9032, other than a good classified under heading 8418 or 8516 
or any of headings 8701 through 8706, and that— 
(A) is entirely or partially comprised of recovered goods; 
(B) has a similar life expectancy to, and meets the 
same performance standards as, a like good that is new; 
and 
(C) enjoys a factory warranty similar to a like good 
that is new. 
(18) TOTAL COST.—The term ‘‘total cost’’ means all product 
costs, period costs, and other costs for a good incurred in 
the territory of Australia, the United States, or both. 
(19) USED.—The term ‘‘used’’ means used or consumed 
in the production of goods.