More Malaysian Firms to Access Preferential China Tariffs With FTA System Launch
Xu Huiyun
DATE:  Nov 07 2018
/ SOURCE:  Yicai
More Malaysian Firms to Access Preferential China Tariffs With FTA System Launch More Malaysian Firms to Access Preferential China Tariffs With FTA System Launch

(Yicai Global) Nov. 6 -- Malaysia aims to boost the number of companies taking advantage of preferential and zero-tariffs with China through the launch of a new English-language initiative approved at the inaugural China International Import Expo.

The roll-out of the localized system for Malaysia's national single window, backed by the ASEAN-China Free Trade Agreement, was rubberstamped at a supporting session of CIIE, which is taking place at Shanghai's National Exhibition and Convention Center until Nov. 10.

The Asia-Pacific Model E-Port Network Operational Center in Shanghai developed the system to provide both Malaysian and Chinese companies engaged in foreign trade with one-stop inquiry services and tariff solutions under the FTA.

The system deals with queries on specific tariff rules and rates, as well as regulations regarding places of origin, commodity tariff descriptions, inspection and quarantine requirements, as well as trade supervision documents.

'The launch of the English version of the ASEAN-China Free Trade Agreement's Preferential Tariff System in Malaysia will make it easier for local and Chinese firms to inquire about agreed rates, China's Vice-Minister of Commerce Wang Shouwen told Yicai Global.

One of the core benefits of the FTA is that 90 percent of commodities can be traded between the two countries with zero tariffs. However, there has been a slow uptake on the program with 77 percent of firms not making use of the agreement, according to the 2016 Global Trade Management Survey conducted by Thomson Reuters and KPMG International.

Firms can gain preferential or zero-tariffs on target commodities originally produced in a member country of the FTA. The utilization rate remains relatively low because some companies, especially small and medium-sized enterprises, are not familiar with the rules and regulations of origin countries.

If companies intend to get the benefits and subsidies of FTA, they will have to go through 10 procedures including selection of parties involved in the trade and places of origin, inquiries about commodity codes and tariffs as well as verification of places of origin and other steps, Huang Feng, director of Asia-Pacific Model E-Port Network Operational Center, previously explained.

Asia-Pacific Model E-Port Network launched the smart preferential tariff system called Smart FTAX under the FTA on Aug. 9. It is able to compare tariff rates set by different FTAs that are applicable to products with the same commodity codes for firms while predicting and calculating the total amount of saved duties according to the imports' total value and offering the best solution. It can also provide complete rules and regulations as well as templates for documentation related to places of origin.

China has so far signed 17 Free Trade Agreements with 25 countries and districts and it has recently lowered the tariffs on products in 3300 categories, reducing the restrictions on business investment from 63 to 48.

Editor: William Clegg

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Keywords:   ASEAN,Trade,Tariff,Custom,Free Trade Agreement,Malaysia,Most-Favored-Nation Treatment