Document ID: chunk:federal_register_of_legislation:C2025C00155:section:153d:p1
Version: federal_register_of_legislation:C2025C00155
Segment Type: section
Provision Reference: s 153D (pt 1/3)
Character Range: 686993–689906

153D  Allowable expenditure of factory on materials

General rule for determining allowable expenditure of a factory on materials
 (1) Subject to the exceptions set out in this section, the allowable expenditure of a factory on materials in respect of preference claim goods is the cost to the manufacturer of those materials in the form they are received at the factory, worked out under section 153E.

Goods wholly or partly manufactured from materials imported from outside the qualifying area
 (2) If:
 (a) preference claim goods (other than goods wholly manufactured from unmanufactured raw products) are manufactured, in whole or in part, from particular materials; and
 (b) those particular materials, in the form they are received at the factory, are imported from a country outside the qualifying area;
there is no allowable expenditure of the factory on those particular materials.

Goods claimed to be the manufacture of a Least Developed Country—special rule
 (2A) If:
 (a) goods claimed to be the manufacture of a Least Developed Country contain materials that, in the form they were received by the factory, were manufactured or produced in Developing Countries that are not Least Developed Countries; and
 (b) the allowable expenditure of the factory on those materials in aggregate would, but for this subsection, exceed 25% of the total factory cost of the goods;
that allowable expenditure on those materials is taken to be 25% of the total factory cost of the goods.

Inland freight rule
 (3) If:
 (a) preference claim goods are manufactured, in whole or in part, from particular materials; and
 (b) the preference country is Papua New Guinea or a Forum Island Country; and
 (ba) the goods are claimed to be the manufacture of Papua New Guinea or a Forum Island Country; and
 (c) those particular materials:
 (i) were imported into the preference country from a country outside the qualifying area; or
 (ii) incorporate other materials (contributing materials) imported into the preference country from a country outside the qualifying area;
then, despite subsection (2), the allowable expenditure of the factory on those particular materials includes:
 (d) the cartage of those particular materials; or
 (e) the part of the cost of those particular materials that is attributable to the cartage of those contributing materials;
from the port or airport in the preference country where those particular materials or contributing materials are first landed to the factory or to the plant where they are processed or first processed.

Goods wholly or partly manufactured from materials imported from outside the qualifying area—intervening manufacture
 (4) If:
 (a) preference claim goods are manufactured, in whole or in part, from particular materials; and
 (b) other materials (contributing materials) have been incorporated in those particular materials; and
 (c) those contributing materials