Australia implemented the GSP program in 1966, and it is known as the Australian System of Trade Preferences (ASTP). Under the ASTP, Australia provides duty free benefits to the LDCs, including Bangladesh on 100% of tariff lines.
After the Hong Kong Ministerial Declaration that mandated the Developed Countries to offer Duty Free Quota Free (DFQF) access to the LDCs, Australia uses its GSP facility for LDCs as the Australia DFQF to the LDCs.
Products exported by eligible countries under the ASTP must comply with Rules of Origin provisions in order to receive preferential treatment. To be eligible for preference under the ASTP, goods must comply with two rules of origin requirements:
(a) The final process of manufacture must have been carried out in the country claiming preference: and
(b) At least half of the total factory or works cost of the goods must consist of the value of labour and/or materials of one or more developing countries (for the purposes of this requirement any Australian content may be counted as if it was developing country content).
To be eligible for GSP/DFQF facility in Australia, the rules of origin require local content to be 50 per cent or more of total factory cost, and that the last process of manufacturing take place in an LDC. An LDC can include input from other LDCs, developing countries, Pacific Forum island countries and Australia (the "qualifying area") in calculating the 50 per cent local content. Within this, non-LDC developing country content is subject to a maximum of 25 per cent of manufacturing costs.
To download Australia’s WTO submission on DFQF in January 2004 in this regard, click here.
For more details and updated information on Australia GSP/DFQF issues, visit www.dfat.gov.au.