Trans-Pacific Partnership Agreement

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CHAPTER 5 
 
CUSTOMS ADMINISTRATION AND TRADE FACILITATION  
 
 
Article 5.1:  Customs Procedures and Facilitation of Trade 
 
Each Party shall ensure that its customs procedures are applied in a 
manner that is predictable, consistent and transparent. 
 
 
Article 5.2:  Customs Cooperation 
 
1. 
With a view to facilitating the effective operation of this Agreement, each 
Party shall: 
 
(a) 
encourage cooperation with other Parties regarding significant 
customs issues that affect goods traded between the Parties; and  
 
(b) 
endeavour to provide each Party with advance notice of any 
significant administrative change, modification of a law or 
regulation, or similar measure related to its laws or regulations that 
governs importations or exportations, that is likely to substantially 
affect the operation of this Agreement. 
 
2. 
Each Party shall, in accordance with its law, cooperate with the other 
Parties through information sharing and other activities as appropriate, to achieve 
compliance with their respective laws and regulations that pertain to: 
 
(a) 
the implementation and operation of the provisions of this 
Agreement governing importations or exportations, including 
claims for preferential tariff treatment, procedures for making 
claims for preferential tariff treatment and verification procedures; 
 
(b) 
the implementation, application and operation of the Customs 
Valuation Agreement; 
 
(c) 
restrictions or prohibitions on imports or exports; 
 
(d) 
investigation and prevention of customs offences, including duty 
evasion and smuggling; and 
 
(e) 
other customs matters as the Parties may decide. 
 
3. 
If a Party has a reasonable suspicion of unlawful activity related to its laws 
or regulations governing importations, it may request that another Party provide 
 
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specific confidential information that is normally collected in connection with the 
importation of goods.  
 
4. 
If a Party makes a request under paragraph 3, it shall:  
 
(a) 
be in writing;  
 
(b) 
specify the purpose for which the information is sought; and  
 
(c) 
identify the requested information with sufficient specificity for the 
other Party to locate and provide the information. 
 
5. 
The Party from which the information is requested under paragraph 3 
shall, subject to its law and any relevant international agreements to which it is a 
party, provide a written response containing the requested information. 
 
6. 
For the purposes of paragraph 3, “a reasonable suspicion of unlawful 
activity” means a suspicion based on relevant factual information obtained from 
public or private sources comprising one or more of the following: 
 
(a) 
historical evidence of non-compliance with laws or regulations that 
govern importations by an importer or exporter; 
 
(b) 
historical evidence of non-compliance with laws or regulations that 
govern importations by a manufacturer, producer or other person 
involved in the movement of goods from the territory of one Party 
to the territory of another Party; 
 
(c) 
historical evidence of non-compliance with laws or regulations that 
govern importations by some or all of the persons involved in the 
movement of goods within a specific product sector from the 
territory of one Party to the territory of another Party; or 
 
(d) 
other information that the requesting Party and the Party from 
which the information is requested agree is sufficient in the context 
of a particular request.  
 
7. 
Each Party shall endeavour to provide another Party with any other 
information that would assist that Party to determine whether imports from, or 
exports to, that Party are in compliance with the receiving Party’s laws or 
regulations that govern importations, in particular those related to unlawful 
activities, including smuggling and similar infractions. 
 
8. 
In order to facilitate trade between the Parties, a Party receiving a request 
shall endeavour to provide the Party that made the request with technical advice 
and assistance for the purpose of: 
 
 
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(a) 
developing and implementing improved best practices and risk 
management techniques;  
 
(b) 
facilitating the implementation of international supply chain 
standards; 
 
(c) 
simplifying and enhancing procedures for clearing goods through 
customs in a timely and efficient manner; 
 
(d) 
developing the technical skill of customs personnel; and 
 
(e) 
enhancing the use of technologies that can lead to improved 
compliance with the requesting Party’s laws or regulations that 
govern importations.   
 
9. 
The Parties shall endeavour to establish or maintain channels of 
communication for customs cooperation, including by establishing contact points 
in order to facilitate the rapid and secure exchange of information and improve 
coordination on importation issues. 
 
 
Article 5.3:  Advance Rulings 
 
1. 
Each Party shall issue, prior to the importation of a good of a Party into its 
territory, a written advance ruling at the written request of an importer in its 
territory, or an exporter or producer in the territory of another Party,
1 
with regard 
to:
2
  
 
(a) 
tariff classification;  
 
(b) 
the application of customs valuation criteria for a particular case in 
accordance with the Customs Valuation Agreement; 
 
(c) 
whether a good is originating in accordance with Chapter 3 (Rules 
of Origin and Origin Procedures); and  
 
(d) 
such other matters as the Parties may decide. 
 
2. 
Each Party shall issue an advance ruling as expeditiously as possible and 
in no case later than 150 days after it receives a request, provided that the 
requester has submitted all the information that the receiving Party requires to 
make the advance ruling.  This includes a sample of the good for which the 
                                                 
1  
For greater certainty, an importer, exporter or producer may submit a request for an advance 
ruling through a duly authorised representative. 
 
2
  For greater certainty, a Party is not required to provide an advance ruling when it does not 
maintain measures of the type subject to the ruling request. 
 
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requester is seeking an advance ruling if requested by the receiving Party.  In 
issuing an advance ruling, the Party shall take into account the facts and 
circumstances that the requester has provided.  For greater certainty, a Party may 
decline to issue an advance ruling if the facts and circumstances forming the basis 
of the advance ruling are the subject of administrative or judicial review.  A Party 
that declines to issue an advance ruling shall promptly notify the requester in 
writing, setting out the relevant facts and circumstances and the basis for its 
decision to decline to issue the advance ruling. 
 
3. 
Each Party shall provide that its advance rulings shall take effect on the 
date that they are issued or on another date specified in the ruling, and remain in 
effect for at least three years, provided that the law, facts and circumstances on 
which the ruling is based remain unchanged.  If a Party’s law provides that an 
advance ruling becomes ineffective after a fixed period of time, that Party shall 
endeavour to provide procedures that allow the requester to renew the ruling 
expeditiously before it becomes ineffective, in situations in which the law, facts 
and circumstances on which the ruling was based remain unchanged. 
 
4. 
After issuing an advance ruling, the Party may modify or revoke the 
advance ruling if there is a change in the law, facts or circumstances on which the 
ruling was based, if the ruling was based on inaccurate or false information, or if 
the ruling was in error.  
 
5. 
A Party may apply a modification or revocation in accordance with 
paragraph 4 after it provides notice of the modification or revocation and the 
reasons for it. 
 
6. 
No Party shall apply a revocation or modification retroactively to the 
detriment of the requester unless the ruling was based on inaccurate or false 
information provided by the requester. 
 
7. 
Each Party shall ensure that requesters have access to administrative 
review of advance rulings. 
 
8. 
Subject to any confidentiality requirements in its law, each Party shall 
endeavour to make its advance rulings publicly available, including online. 
 
 
Article 5.4:  Response to Requests for Advice or Information 
 
 
On request from an importer in its territory, or an exporter or producer in 
the territory of another Party, a Party shall expeditiously provide advice or 
information relevant to the facts contained in the request on: 
 
(a) 
the requirements for qualifying for quotas, such as tariff rate 
quotas; 
 
 
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(b) 
the application of duty drawback, deferral or other types of relief 
that reduce, refund or waive customs duties;  
 
(c) 
the eligibility requirements for goods under Article 2.6 (Goods Re-
entered after Repair and Alteration);  
 
(d) 
country of origin marking, if it is a prerequisite for importation; 
and 
 
(e) 
other matters as the Parties may decide. 
 
 
Article 5.5:  Review and Appeal 
 
1. 
Each Party shall ensure that any person to whom it issues a determination
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on a customs matter has access to: 
 
(a) 
administrative review of the determination, independent
4
 of the 
employee or office that issued the determination; and  
 
(b) 
judicial review of the determination.
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2. 
Each Party shall ensure that an authority that conducts a review under 
paragraph 1 notifies the parties to the matter in writing of its decision and the 
reasons for the decision.  A Party may require a request as a condition for 
providing the reasons for a decision in the review. 
 
 
Article 5.6:  Automation 
 
1. 
Each Party shall:  
 
(a) 
endeavour to use international standards with respect to procedures 
for the release of goods;  
 
(b) 
make electronic systems accessible to customs users; 
 
(c) 
employ electronic or automated systems for risk analysis and 
targeting; 
 
(d) 
endeavour to implement common standards and elements for 
                                                 
3
  For the purposes of this Article, a determination, if made by Peru, means an administrative act.  
 
4
  The level of administrative review may include any authority supervising the customs 
administration.  
 
5
  Brunei Darussalam may comply with this paragraph by establishing or maintaining an 
independent body to provide impartial review of the determination.  
 
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import and export data in accordance with the World Customs 
Organization (WCO) Data Model; 
 
(e) 
take 
into 
account, 
as 
appropriate, WCO 
standards, 
recommendations, models and methods developed through the 
WCO or APEC; and 
 
(f) 
work toward developing a set of common data elements that are 
drawn from the WCO Data Model and related WCO 
recommendations as well as guidelines to facilitate government to 
government electronic sharing of data for purposes of analysing 
trade flows. 
 
2. 
Each Party shall endeavour to provide a facility that allows importers and 
exporters to electronically complete standardised import and export requirements 
at a single entry point. 
 
 
Article 5.7:  Express Shipments 
 
1. 
Each Party shall adopt or maintain expedited customs procedures for 
express shipments while maintaining appropriate customs control and selection.  
These procedures shall:  
 
(a) 
provide for information necessary to release an express shipment to 
be submitted and processed before the shipment arrives;  
 
(b) 
allow a single submission of information covering all goods 
contained in an express shipment, such as a manifest, through, if 
possible, electronic means;
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(c) 
to the extent possible, provide for the release of certain goods with 
a minimum of documentation;   
 
(d) 
under normal circumstances, provide for express shipments to be 
released within six hours after submission of the necessary customs 
documents, provided the shipment has arrived; 
 
(e) 
apply to shipments of any weight or value recognising that a Party 
may require formal entry procedures as a condition for release, 
including declaration and supporting documentation and payment 
of customs duties, based on the good’s weight or value; and  
 
(f) 
provide that, under normal circumstances, no customs duties will 
be assessed on express shipments valued at or below a fixed 
                                                 
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  For greater certainty, additional documents may be required as a condition for release. 
 
 
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amount set under the Party’s law.7  Each Party shall review the 
amount periodically taking into account factors that it may 
consider relevant, such as rates of inflation, effect on trade 
facilitation, impact on risk management, administrative cost of 
collecting duties compared to the amount of duties, cost of cross-
border trade transactions, impact on SMEs or other factors related 
to the collection of customs duties. 
 
2. 
If a Party does not provide the treatment in paragraph 1(a) through (f) to 
all shipments, that Party shall provide a separate
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 and expedited customs 
procedure that provides that treatment for express shipments. 
 
 
Article 5.8:  Penalties 
 
1. 
Each Party shall adopt or maintain measures that allow for the imposition 
of a penalty by a Party’s customs administration for a breach of its customs laws, 
regulations or procedural requirements, including those governing tariff 
classification, customs valuation, country of origin and claims for preferential 
treatment under this Agreement. 
 
2. 
Each Party shall ensure that a penalty imposed by its customs 
administration for a breach of a customs law, regulation or procedural requirement 
is imposed only on the person legally responsible for the breach. 
 
3. 
Each Party shall ensure that the penalty imposed by its customs 
administration is dependent on the facts and circumstances
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 of the case and is 
commensurate with the degree and severity of the breach.    
 
4. 
Each Party shall ensure that it maintains measures to avoid conflicts of 
interest in the assessment and collection of penalties and duties.  No portion of the 
remuneration of a government official shall be calculated as a fixed portion or 
percentage of any penalties or duties assessed or collected. 
 
5. 
Each Party shall ensure that if a penalty is imposed by its customs 
administration for a breach of a customs law, regulation or procedural 
requirement, an explanation in writing is provided to the person upon whom the 
penalty is imposed specifying the nature of the breach and the law, regulation or 
procedure used for determining the penalty amount. 
 
                                                 
7
  Notwithstanding this Article, a Party may assess customs duties, or may require formal entry 
documents, for restricted or controlled goods, such as goods subject to import licensing or similar 
requirements.  
 
8
  For greater certainty, “separate” does not mean a specific facility or lane. 
 
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  Facts and circumstances shall be established objectively according to each Party’s law. 
 
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6.  
If a person voluntarily discloses to a Party’s customs administration the 
circumstances of a breach of a customs law, regulation or procedural requirement 
prior to the discovery of the breach by the customs administration, the Party’s 
customs administration shall, if appropriate, consider this fact as a potential 
mitigating factor when a penalty is established for that person.   
 
7. 
Each Party shall provide in its laws, regulations or procedures, or 
otherwise give effect to, a fixed and finite period within which its customs 
administration may initiate proceedings
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 to impose a penalty relating to a breach 
of a customs law, regulation or procedural requirement. 
 
8. 
Notwithstanding paragraph 7, a customs administration may impose, 
outside of the fixed and finite period, a penalty where this is in lieu of judicial or 
administrative tribunal proceedings. 
 
 
Article 5.9:  Risk Management 
 
1. 
Each Party shall adopt or maintain a risk management system for 
assessment and targeting that enables its customs administration to focus its 
inspection activities on high-risk goods and that simplifies the clearance and 
movement of low-risk goods. 
 
2. 
In order to facilitate trade, each Party shall periodically review and update, 
as appropriate, the risk management system specified in paragraph 1. 
 
 
Article 5.10:  Release of Goods 
 
1. 
Each Party shall adopt or maintain simplified customs procedures for the 
efficient release of goods in order to facilitate trade between the Parties.  This 
paragraph shall not require a Party to release a good if its requirements for release 
have not been met. 
 
2. 
Pursuant to paragraph 1, each Party shall adopt or maintain procedures 
that:  
 
(a) 
provide for the release of goods within a period no longer than that 
required to ensure compliance with its customs laws and, to the 
extent possible, within 48 hours of the arrival of the goods;  
 
(b) 
provide for the electronic submission and processing of customs 
information in advance of the arrival of the goods in order to 
expedite the release of goods from customs control upon arrival; 
 
                                                 
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  For greater certainty, “proceedings” means administrative measures by the customs 
administration and does not include judicial proceedings.   
 
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(c) 
allow goods to be released at the point of arrival without temporary 
transfer to warehouses or other facilities; and 
 
(d) 
allow an importer to obtain the release of goods prior to the final 
determination of customs duties, taxes and fees by the importing 
Party’s customs administration when these are not determined prior 
to or promptly upon arrival, provided that the good is otherwise 
eligible for release and any security required by the importing 
Party has been provided or payment under protest, if required by a 
Party, has been made.  Payment under protest refers to payment of 
duties, taxes and fees if the amount is in dispute and procedures are 
available to resolve the dispute. 
 
3. 
If a Party allows for the release of goods conditioned on a security, it shall 
adopt or maintain procedures that: 
 
(a) 
ensure that the amount of the security is no greater than that 
required to ensure that obligations arising from the importation of 
the goods will be fulfilled;  
 
(b) 
ensure that the security shall be discharged as soon as possible 
after its customs administration is satisfied that the obligations 
arising from the importation of the goods have been fulfilled; and 
 
(c) 
allow importers to provide security using non-cash financial 
instruments, including, in appropriate cases where an importer 
frequently enters goods, instruments covering multiple entries. 
 
 
Article 5.11:  Publication 
 
1. 
Each Party shall make publicly available, including online, its customs 
laws, regulations, and general administrative procedures and guidelines, to the 
extent possible in the English language. 
 
2. 
Each Party shall designate or maintain one or more enquiry points to 
address enquiries from interested persons concerning customs matters and shall 
make information concerning the procedures for making such enquiries publicly 
available online. 
 
3. 
To the extent possible, each Party shall publish in advance regulations of 
general application governing customs matters that it proposes to adopt and shall 
provide interested persons the opportunity to comment before the Party adopts the 
regulation. 
 
 
 
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Article 5.12:  Confidentiality 
 
 
1. 
If a Party provides information to another Party in accordance with this 
Chapter and designates the information as confidential, the other Party shall keep 
the information confidential.  The Party that provides the information may require 
the other Party to furnish written assurance that the information will be held in 
confidence, used only for the purposes specified in the other Party’s request for 
information, and not disclosed without the specific permission of the Party that 
provided the information or the person that provided the information to that Party.   
 
2. 
A Party may decline to provide information requested by another Party if 
that Party has failed to act in accordance with paragraph 1. 
 
3. 
Each Party shall adopt or maintain procedures for protecting from 
unauthorised disclosure confidential information submitted in accordance with the 
administration of the Party’s customs laws, including information the disclosure 
of which could prejudice the competitive position of the person providing the 
information. 
 
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