ASSOCIATION OF SOUTHEAST

ASIAN NATIONS

WHAT IS THE ASSOCIATION OF SOUTHEAST ASIAN NATIONS?

The Association of Southeast Asian Nations was established in August 8, 1967 through the Bangkok
Declaration and is a regional stability among the countries in the Southeast Asian Region.

Who are the founding members?

 Indonesia;
 Malaysia;
 Philippines;
 Singapore; and
 Thailand

Brunei Darussalam joined on January 7, 1984, Viet Nam on July 28, 1995, Lao PDR and Myanmar on July 23,
1997 and Cambodia on April 30, 1999.

ASEAN’s main objectives are to accelerate economic growth, enhance social progress and cultural development
and to promote regional peace and stability in the region.

FUNDAMENTAL PRINCIPLES OF THE ASEAN

The following are the fundamental principles as contained on the Treaty of Amity and Cooperation in
Southeast Asia of 1976:
 Mutual respect for the independence, sovereignty, equality, territorial integrity and national identity of
all nations;
 Right of every state to lead its national existence free from external interference, subversion and
coercion;
 Non-interference in the internal affairs of one another;
 Settlement of differences or disputes by peaceful manner;
 Renunciation of the threat or use of force; and
 Effective cooperation among each other.

THE ASEAN CHARTER

The ASEAN Charter refers to the legal document that provides the legal status and institutional framework for
cooperation within the ASEAN region and towards the formulation of the ASEAN Community. This also codifies
the norms, rules and values; sets clear targets for ASEAN; and presents accountability and compliance.

The Charter was signed by the government of the 10 AMS on November 20, 2007 and entered into force on
December 15, 2008.

PROCEDURES FOR APPLICATION AND ADMISSION OF NEW MEMBERS

a. The procedure for application and admission to ASEAN shall be prescribed by the ASEAN Coordinating
Council.
b. Admission shall be based on the following criteria:
 Location in the recognized geographical region of Southeast Asia;
 Recognition by all AMS;
 Agreement to be bound and abide by the ASEAN Charter; and
 Ability and willingness to carry out the obligations of membership.
c. Admission shall be decided by consensus by the ASEAN Summit, upon the recommendation of the ACC.
d. An applicant shall be admitted to ASEAN upon signing an Instrument of Accession to the Charter.

GENERAL PRINCIPLES FOR THE SETTLEMENT OF DISPUTES

 Member States shall endeavour to resolve peacefully all disputes in a timely manner through dialogue,
consultation and negotiation.
 ASEAN shall maintain and establish dispute settlement mechanisms in all fields of ASEAN cooperation.

What will happen to unresolved disputes?

After the application of the preceding provisions, the dispute shall be referred to the ASEAN Summit, for its
decision.
THE ASEAN SUMMIT
The organization holds meeting known as the “ASEAN Summit”, where heads of the state or government of
each member states meet to discuss and resolve regional issues, as well as meet with other countries outside
of the bloc with the intention of promoting external relations.

(Please refer to the Primer on Developments in Tariff and Trade Policy)

The ASEAN Summit also appoints the Secretary-General of ASEAN.

The meetings are held twice annually, and hosted by the Member State holding the ASEAN Chairmanship; and
convened , whenever necessary, as special or ad hoc meetings chaired by the Member State holding the
ASEAN Chairmanship, at venues to be agreed upon by the AMS.

THE BODIES COMPRISINH THE ASEAN SUMMIT

ASEAN Coordinating Council

- Comprises the ASEAN Foreign Ministers and meets at least twice a year.
- Prepare the meetings of the ASEAN Summit;
- Coordinate the implementation of agreements and decisions of the ASEAN Summit;
- Coordinate with the ASEAN Community Councils to enhance policy coherence, efficiency and
cooperation among them;
- Coordinate the reports of the ASEAN Community Councils to the ASEAN Summit;
- Consider the annual report of the Secretary-General on the work of ASEAN;
- Consider the report of the Secretary-General on the functions and operations of the ASEAN Secretariat
and other relevant bodies;
- Approve the appointment and termination of the Deputy Secretaries-General upon recommendation of
the Secretary-General; and
- Undertake other tasks provided for or such other functions as me be assigned by the ASEAN Summit.

ASEAN Community Councils

- Comprises the three pillars of the ASEAN Community: ASEAN Political-Security Community Council,
ASEAN Economic Community Council and ASEAN Socio-Cultural Community Council.
- Ensure the implementation of the relevant decisions of the ASEAN Summit;
- Coordinate the work of the different sectors under its purview, and on issues which cut across the
other Community Councils; and
- Submit reports and recommendations to the ASEAN Summit on matters under its purview.

ASEAN Sectoral Ministerial Bodies

- Implement the agreements and decisions of the ASEAN Summit under their respective purview.

THE SECRETARY-GENERAL
The ASEAN Summit appoints the Secretary-General of ASEAN, with the rank and status of a Minister, who will
serve with the confidence and at the pleasure of the ASEAN Heads of State or Government upon
recommendation of the ASEAN Foreign Ministers Meeting.

He/She is appointed for a non-renewable term of office of five years, selected from among nationals of the
AMS based on alphabetical rotation with due consideration to integrity, capability professional experience and
gender equality.

The Secretary-General’s mandate is to initiate, advise, coordinate and implement ASEAN activities. He chairs
the meetings of the ASEAN Standing Committee on behalf of the ASEAN Standing Committee Chairman,
except the first and the last.

DETERMINATION OF THE ASEAN CHAIRMANSHIP

The chairmanship of ASEAN shall rotate annually, based on the alphabetical order of the English names of the
member states.

THE ASEAN COMMUNITY (please refer to the primer)

THE ASEAN FREE TRADE AREA (AFTA)

The AFTA is a trade bloc agreement which seeks to remove obstacles to freer trade among AMS through the
abolition of tariffs on traded goods and the scrapping of quantitative restrictions and other non-tariff barriers
that limit the entry of imports. The ASEAN Heads of Government agreed the establishment of AFTA by the
year 2008 at the 4th ASEAN Summit held in Singapore on January 28, 1992.
THE COMMON EFFECTIVE PREFERENTIAL TARIFF SCHEME
The CEPT is the main implementing mechanism of the AFTA. This means that AMS shall have common
effective tariffs among themselves in AFTA but the level of tariffs vis-à-vis non-ASEAN countries shall continue
to be determined individually.

THE ASEAN TRADE IN GOODS AGREEMENT (ATIGA)

An improvement over the CEPT-AFTA Scheme, the ATIGA consolidates into one comprehensive agreement the
existing initiatives, obligations and commitments by the AMS with regard to both trade in goods and non-tariff
elements. The ATIGA was signed on February 2009 and entered into force on May 17, 2010 upon notification
of the ratification of all AMS.

What is the objective of the ATIGA?

ATIGA seeks to achieve free flow of goods in ASEAN as one of the principal means to establish a single market
and production base for the deeper economic integration of the region towards the realization of the AEC by
2015.

(Please refer to Primer)

 ASEAN AND ITS FREE TRADE
AREA PARTNERS

ASEAN-AUSTRALIA-NEW ZEALAND FREE TRADE AREA

What is AANZFTA?
It is a trade agreement among the 10 ASEAN member states, Australia and New Zealand. It was signed on
February 27, 2009 and entered into force on January 1, 2010 in Cha-am, Thailand.

What is the objective of AANZFTA?

Deeper economic integration between the two regions through:
 Progressive liberalization and facilitation of trade in goods, trade in services, investments; and
 Trade and investment facilitation and economic cooperation measures.

What is the product coverage of the trade in Goods (TIG) Chapter of AANZFTA?
All goods from HS Chapter 1 to 97 except for:
 Rice
 Sugar
 Selected articles of iron and steel.

What are the 2 programs of tariff reduction under the TIG Chapter of AANZFTA?

What are the rules of origin under the AANZFTA?

 Products which are wholly obtained or produced in the exporting party shall be deemed originating and
eligible for preferential tariff treatment.
 The “General Rule” of RVC 40 is applicable to all other goods except where there is a product specific
rule. The PSR becomes either the exclusive rule or an alternative to or a combination with the general
rule depending on the provisions of Annex 2 of the Agreement.

ROO Criteria – General Rule RVC 40 or Change in Tariff Heading

CO Form Form AANZ
Reciprocity Rule None

What are the criteria for products to be eligible for concession under AANZFTA?
a. Product should be in the Inclusion List
b. Product should be wholly obtained or produced in the extraordinary party or RVC 40 or Change in Tariff
Heading or Product Specific Rule (PSR) to be deemed originating
c. Certificate of Origin Form AANZ

What Executive Orders implemented the Philippine’s tariff commitments under AANZFTA?
 EO 851 issued on December 23, 2009 and which took effect on January 1, 2010.
 EO 191 issued on November 5, 2015 and which took effect on November 12, 2015.
 ASEAN-CHINA FREE TRADE AREA

What is the ASEAN-China Free Trade Area?

The ACFTA is a trade agreement among the 10 Member States of the ASEAN and China. The Framework
Agreement on Comprehensive Economic Cooperation between ASEAN and China covering trade in goods,
trade in services, investments and other measures to develop new areas of economic cooperation was signed
on November 4, 2002.

What are the objectives of the ACFTA?

The ACFTA seeks to strengthen and enhance economic, trade and investment cooperation between the
parties; progressively liberalize and promote trade in goods and services as well as create a transparent, liberal
and facilitative investment regime. ACFTA also seeks to explore new areas and develop appropriate measures
for closer economic cooperation between the parties; and facilitate the more effective economic integration of
the newer AMS and bridge the development gap among the parties.

What is the Early Harvest Program (EHP) and its product coverage?
The EHP aimed to accelerate the implementation of Article 6 of the Framework Agreement on trade in goods.

The EHP covers all products falling under the HS Chapters 1 to 8. Parties were allowed to have an Exclusion
List.

Implementation began on January 1, 2004 for ASEAN, except for the Philippines and China. On December 29,
2005, the Philippines issued EO 485 to implement the EHP Commitments.

What are the timeframes for the Agreement on Trade in Goods?

What is the reciprocal tariff treatment under ACFTA?
Reciprocal tariff treatment is not automatically applied. Products that have been placed in ST may be accorded
reciprocal tariff treatment as governed by paragraph 6 of Annex 2 of the TIG, after notification has been
received from the party/ies that the rates of duty on its products in St are at 10% and below.

How is reciprocal tariff treatment applied?

What are the Rules of Origin (ROO) under the ACFTA?