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FTA: Free Trade Agreement

Tariff elimination and reduction

General notes

  1. 1. For the purposes of Article 2.8, each Party shall entirely eliminate customs duties on originating goods of the other Party on the date of entry into force of this Agreement, unless otherwise provided for in this Annex.
  2. 2. For the purpose of implementing equal annual instalments, the following applies:
    1. a.the reduction for the first year shall take place on the date of entry into force of this Agreement; and
    2. b.in the case of Part 3, with respect to the first year, the period from the date of entry into force of this Agreement until the following 31 March and, with respect to each subsequent year, the 12-month period starting on 1 April of that year.
  3. 3.For the purposes of this Annex, "year" means:
    1. a.in the case of Part 2, with respect to the first year, the 12-month period from the date of entry into force of this Agreement and, with respect to each subsequent year, the 12-month period after the end of the previous year; and
    2. b.in the case of Part 3, with respect to the first year, the period from the date of entry into force of this Agreement until the following 31 March and, with respect to each subsequent year, the 12-month period starting on 1 April of that year.
  4. 4.The base rate of customs duty and the category for determining the interim rate of customs duty at each stage of reduction for a tariff line are specified for that tariff line in the Schedules of the European Union in Section B of Part 2 and of Japan in Section D of Part 3.
  5. 5.For the purposes of this Annex, unless otherwise provided for in Parts 2 and 3, "base rate" means the starting point of elimination or reduction of customs duties.
  6. 6.Unless otherwise provided for in this Annex, for the purposes of the elimination or reduction of customs duties in accordance with this Annex, in the case of ad valorem duties any fraction less than 0.1 of a percentage point shall be rounded to the nearest one decimal place (in the case of 0.05 per cent, the fraction shall be rounded to 0.1 per cent), and in the case of specific duties any fraction smaller than 0.01 of one euro or one Japanese yen shall be rounded to the nearest two decimal places (in the case of 0.005, the fraction shall be rounded to 0.01).
  7. 7.This Annex is based on the Harmonized System, as amended on 1 January 2017 and:
    1. a. in the case of Part 2, the eight-digit code of the tariff classification numbers of the European Union and the corresponding description for each tariff line referred to in the Schedule of the European Union are based on the combined nomenclature of the European Union (Combined Nomenclature of 1 January 2017); and
    2. b. in the case of Part 3, the nine-digit code of the tariff classification numbers of Japan and the corresponding description for each tariff line referred to in the Schedule of Japan are based on the national nomenclature of Japan (Statistical Code Lists for Imports as of 1 April 2017).
  8. 8. For greater certainty, the tariff classification numbers and their corresponding descriptions referred to in the Schedule of each Party may be subject to change in case of any amendment to its nomenclature referred to in paragraph 7 in accordance with its laws, regulations or public notifications, and shall be referred to together with the correlation tables published by each Party in case of any change of nomenclature.

SECTION A

Notes for the Schedule of the European Union
  1. 1. For the purposes of Article 2.8, the following categories indicated in Column "Category" in the Schedule of the European Union in Section B apply:
    1. a.customs duties on originating goods classified under the tariff lines indicated with "B3" shall be eliminated in four equal annual instalments beginning on the date of entry into force of this Agreement, and such goods shall thereafter be free of any customs duty;
    2. b.customs duties on originating goods classified under the tariff lines indicated with "B5" shall be eliminated in six equal annual instalments beginning on the date of entry into force of this Agreement, and such goods shall thereafter be free of any customs duty;
    3. c.customs duties on originating goods classified under the tariff lines indicated with "B7" shall be eliminated in eight equal annual instalments beginning on the date of entry into force of this Agreement, and such goods shall thereafter be free of any customs duty;
    4. d.customs duties on originating goods classified under the tariff lines indicated with "B10" shall be eliminated in 11 equal annual instalments beginning on the date of entry into force of this Agreement, and such goods shall thereafter be free of any customs duty;
    5. e.customs duties on originating goods classified under the tariff lines indicated with "B12" shall be eliminated in 13 equal annual instalments beginning on the date of entry into force of this Agreement, and such goods shall thereafter be free of any customs duty;
    6. f.customs duties on originating goods classified under the tariff lines indicated with "B15" shall be eliminated in 16 equal annual instalments beginning on the date of entry into force of this Agreement, and such goods shall thereafter be free of any customs duty;
    7. g.customs duties on originating goods classified under the tariff lines indicated with "EU10" shall remain at the base rate from the first year to the seventh year and be eliminated in four equal annual instalments beginning on the first day of the eighth year, and such goods shall thereafter be free of any customs duty;
    8. h.customs duties on originating goods classified under the tariff lines indicated with "X" are excluded from reduction or elimination in this Agreement;
    9. i.customs duties (including the agricultural element of duty1 (marked as "EA") where this element is mentioned as part of the base rate) on originating goods classified under the tariff lines indicated with "R5" shall be reduced by the percentage indicated in the Schedule in six equal annual instalments beginning on the date of entry into force of this Agreement;
    10. j.customs duties (including the agricultural element of duty (marked as "EA") where this element is mentioned as part of the base rate) on originating goods classified under the tariff lines indicated with "R7" shall be reduced by the percentage indicated in the Schedule in eight equal annual instalments beginning on the date of entry into force of this Agreement;
    11. k.customs duties (including the agricultural element of duty (marked as "EA") where this element is mentioned as part of the base rate) on originating goods classified under the tariff lines indicated with "R10" shall be reduced by the percentage indicated in the Schedule in 11 equal annual instalments beginning on the date of entry into force of this Agreement; and
    12. l.the ad valorem component of the customs duties on the originating goods classified under the tariff lines indicated with "entry price" shall be eliminated upon the date of entry into force of this Agreement; the tariff elimination shall only apply to the ad valorem component of the customs duties; the specific duty component of the customs duties resulting from the entry price system1 on these originating goods shall be maintained.
  2. 2.The treatment of originating goods classified under the tariff lines indicated with "S" in Column "Note" in the Schedule of the European Union in Section B shall be subject to review pursuant to paragraphs 3 and 4 of Article 2.8.
  1. Legal reference for EA: Annex 1 to Commission Implementing Regulation (EU) 2016/1821 of 6 October 2016 amending Annex I to Council Regulation (EEC) No 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff.

Notes for the Schedule of Japan

  1. 1. For the purposes of Article 2.8, the following categories indicated in Column "Category" in the Schedule of Japan in Section D apply:
    1. a. in addition to customs duties on originating goods classified under the tariff lines which are not listed in the Schedule of Japan, customs duties on originating goods classified under the tariff lines indicated with "A" shall be eliminated entirely, and these goods shall be duty-free as from the date of entry into force of this Agreement;
    2. b. customs duties on originating goods classified under the tariff lines indicated with "B3" shall be eliminated in four equal annual instalments, and these goods shall be duty-free as from 1 April of the fourth year;
    3. c. customs duties on originating goods classified under the tariff lines indicated with "B5" shall be eliminated in six equal annual instalments, and these goods shall be duty-free as from 1 April of the sixth year;
    4. d. customs duties on originating goods classified under the tariff lines indicated with "B5*" shall be eliminated as follows:
      1. i. the customs duties shall be reduced by 20 per cent of the base rate on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall be eliminated from the level set out in subparagraph (i) in five equal annual instalments beginning on 1 April of the second year, and these goods shall be duty-free as from 1 April of the sixth year;
    5. e. customs duties on originating goods classified under the tariff lines indicated with "B5**" shall be eliminated as follows:
      1. i. the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall be eliminated from the level set out in subparagraph (i) in five equal annual instalments beginning on 1 April of the second year, and these goods shall be duty-free as from 1 April of the sixth year;
    6. f. customs duties on originating goods classified under the tariff lines indicated with "B5***" shall remain at the base rate until 31 March of the fifth year, and these goods shall be duty-free as from 1 April of the sixth year;
    7. g. customs duties on originating goods classified under the tariff lines indicated with "B5****" shall be eliminated as follows:
      1. i. the customs duties shall be reduced to 25 per cent ad valorem and 40 yen per kilogramme on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall be eliminated from the level set out in subparagraph (i) in five equal annual instalments beginning on 1 April of the second year, and these goods shall be duty-free as from 1 April of the sixth year;
    8. h. customs duties on originating goods classified under the tariff lines indicated with "B5*****" shall be eliminated as follows:
      1. i. the customs duties shall be reduced to 35 per cent ad valorem and 40 yen per kilogramme on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall be eliminated from the level set out in subparagraph (i) in five equal annual instalments beginning on 1 April of the second year, and these goods shall be duty-free as from 1 April of the sixth year;
    9. i. customs duties on originating goods classified under the tariff lines indicated with "B7" shall be eliminated in eight equal annual instalments, and these goods shall be duty-free as from 1 April of the eighth year;
    10. j. customs duties on originating goods classified under the tariff lines indicated with "B7*" shall be eliminated as follows:
      1. i. the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall be eliminated from the level set out in subparagraph (i) in seven equal annual instalments beginning on 1 April of the second year, and these goods shall be duty-free as from 1 April of the eighth year;
    11. k. customs duties on originating goods classified under the tariff lines indicated with "B7**" shall be eliminated as follows:
      1. i. the customs duties shall be reduced by 20 per cent of the base rate on the date of entry into force of this Agreement;
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) until 31 March of the third year; and
      3. iii. the customs duties shall be eliminated from the level set out in subparagraph (i) in five equal annual instalments beginning on 1 April of the fourth year, and these goods shall be duty-free as from 1 April of the eighth year;
    12. l. customs duties on originating goods classified under the tariff lines indicated with "B8" shall be eliminated in nine equal annual instalments, and these goods shall be duty-free as from 1 April of the ninth year;
    13. m. customs duties on originating goods classified under the tariff lines indicated with "B9*" shall be eliminated as follows:
      1. i. the customs duties shall be reduced to 2.2 per cent ad valorem on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall be eliminated from the level set out in subparagraph (i) in nine equal annual instalments beginning on 1 April of the second year, and these goods shall be duty-free as from 1 April of the 10th year;
    14. n. customs duties on originating goods classified under the tariff lines indicated with "B10" shall be eliminated in 11 equal annual instalments, and these goods shall be duty-free as from 1 April of the 11th year;
    15. o. customs duties on originating goods classified under the tariff lines indicated with "B10*" shall be eliminated as follows:
      1. i. the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall be eliminated from the level set out in subparagraph (i) in 10 equal annual instalments beginning on 1 April of the second year, and these goods shall be duty-free as from 1 April of the 11th year;
    16. p. customs duties on originating goods classified under the tariff lines indicated with "B10**" shall be:
      1. i. from the date of entry into force of this Agreement until 31 March of the 10th year, the difference between:
        1. A. the sum of:
          1. 1. the value per kilogramme obtained by multiplying the value of the customs duty per kilogramme by a Coefficient which shall be the difference between 100 per cent plus the rate set out in Column 3 of the table below and the value obtained by dividing the value per kilogramme set out in Column 2 of the table below by 897.59 yen per kilogramme; and
          2. 2. the value per kilogramme set out in Column 2 of the table below; and
            1 2 3
            Year Value per kilogramme (yen) Rate (%)
            1 307.87 4.3
            2 269.50 3.7
            3 231.13 3.2
            4 192.75 2.7
            5 154.38 2.2
            6 128.65 1.8
            7 102.91 1.4
            8 77.19 1.1
            9 51.46 0.7
            10 25.72 0.3
        2. B. the value for customs duty per kilogramme; and
      2. ii. zero, as from 1 April of the 11th year;
    17. q. customs duties on originating goods classified under the tariff lines indicated with "B10***" shall be eliminated as follows:
      1. i. the customs duties shall be reduced to 4.3 per cent ad valorem on the date of entry into force of this Agreement;
      2. ii. the customs duties shall be reduced to 2.2 per cent ad valorem from the level set out in subparagraph (i) in four equal annual instalments beginning on 1 April of the second year; and
      3. iii. the customs duties shall be eliminated from the level set out in subparagraph (ii) in six equal annual instalments beginning on 1 April of the sixth year, and these goods shall be duty-free as from 1 April of the 11th year;
    18. r. customs duties on originating goods classified under the tariff lines indicated with "B10****" shall be eliminated as follows:
      1. i. the customs duties shall be reduced by 25 per cent of the base rate on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall be eliminated from the level set out in subparagraph (i) in 10 equal annual instalments beginning on 1 April of the second year, and these goods shall be duty-free as from 1 April of the 11th year;
    19. s. customs duties on originating goods classified under the tariff lines indicated with "B12*" shall be eliminated as follows:
      1. i. the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall be eliminated from the level set out in subparagraph (i) in 12 equal annual instalments beginning on 1 April of the second year, and these goods shall be duty-free as from 1 April of the 13th year;
    20. t. customs duties on originating goods classified under the tariff lines indicated with "B12**" shall be eliminated as follows:
      1. i. the customs duties shall be reduced by 20 per cent of the base rate on the date of entry into force of this Agreement;
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) until 31 March of the sixth year; and
      3. iii. the customs duties shall be eliminated from the level set out in subparagraph (ii) in seven equal annual instalments beginning on 1 April of the seventh year, and these goods shall be duty-free as from 1 April of the 13th year;
    21. u. customs duties on originating goods classified under the tariff lines indicated with "B12***" shall be eliminated as follows:
      1. i. the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement;
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) until 31 March of the sixth year;
      3. iii. the customs duties shall be reduced by 25 per cent of the base rate from the level set out in subparagraph (ii) on 1 April of the seventh year;
      4. iv. the customs duties shall remain at the level set out in subparagraph (iii) until 31 March of the 12th year; and
      5. v. the customs duties shall be eliminated, and these goods shall be duty-free as from 1 April of the 13th year;
    22. v. customs duties on originating goods classified under the tariff lines indicated with "B13" shall be eliminated in 14 equal annual instalments, and these goods shall be duty-free as from 1 April of the 14th year;
    23. w. customs duties on originating goods classified under the tariff lines indicated with "B15" shall be eliminated in 16 equal annual instalments, and these goods shall be duty-free as from 1 April of the 16th year;
    24. x. customs duties on originating goods classified under the tariff lines indicated with "B15*" shall be:
      1. i. from the date of entry into force of this Agreement until 31 March of the 15th year, the lesser of:
        1. A. the difference between the value for customs duty per each and the value per each obtained by multiplying 20,400.55 yen per each by 100 per cent plus the rate set out in Column 3 of the table below; and
        2. B. the value per each set out in Column 2 of the table below; and
        3. 1 2 3
          Year Value per each (yen) Rate (%)
          1 18,288.75 7.9
          2 17,069.50 7.4
          3 15,850.25 6.9
          4 14,631.00 6.3
          5 13,411.75 5.8
          6 12,192.50 5.3
          7 10,973.25 4.7
          8 9,754.00 4.2
          9 8,534.75 3.7
          10 7,315.50 3.1
          11 6,096.25 2.6
          12 4,877.00 2.1
          13 3,657.75 1.5
          14 2,438.50 1.0
          15 1,219.25 0.5
      2. ii. zero, as from 1 April of the 16th year;
    25. y. customs duties on originating goods classified under the tariff lines indicated with "B20*" shall be eliminated as follows:
      1. i. the customs duties shall be reduced by 80 per cent of the base rate in 11 equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall be eliminated from the level set out in subparagraph (i) in 10 equal annual instalments beginning on 1 April of the 12th year, and these goods shall be duty-free as from 1 April of the 21st year;
    26. z. customs duties on originating goods classified under the tariff lines indicated with "R1" shall be reduced as follows:
      1. i. the customs duties shall be reduced to 27.5 per cent ad valorem on the date of entry into force of this Agreement;
      2. ii. the customs duties shall be reduced to 20 per cent ad valorem from the level set out in subparagraph (i) in nine equal annual instalments beginning on 1 April of the second year;
      3. iii. the customs duties shall be reduced to 9 per cent ad valorem from the level set out in subparagraph (ii) in six equal annual instalments beginning on 1 April of the 11th year; and
      4. iv. the customs duties shall remain at 9 per cent ad valorem from the 16th year;
    27. aa. customs duties on originating goods classified under the tariff lines indicated with "R2" shall be the lesser of:
      1. i. the difference between the value for customs duty per kilogramme and the value per kilogramme obtained by multiplying 393 yen per kilogramme by 100 per cent plus the rate set out in Column 3 of the table below; and
      2. ii. the value per kilogramme set out in Column 2 of the table below:
        1 2 3
        Year Value per kilogramme (yen) Rate (%)
        1 93.75 2.2
        2 93.75 1.9
        3 93.75 1.7
        4 93.75 1.4
        5 52.50 1.2
        6 49.50 0.9
        7 46.50 0.7
        8 43.50 0.4
        9 40.50 0.2
        10 and thereafter 37.50 0
    28. bb. customs duties on originating goods classified under the tariff lines indicated with "R3" shall be the lesser of:
      1. i. the difference between the value for customs duty per kilogramme and the value per kilogramme obtained by multiplying 524 yen per kilogramme by 100 per cent plus the rate set out in Column 3 of the table below; and
      2. ii. the value per kilogramme set out in Column 2 of the table below:
        1 2 3
        Year Value per kilogramme (yen) Rate (%)
        1 125 2.2
        2 125 1.9
        3 125 1.7
        4 125 1.4
        5 70 1.2
        6 66 0.9
        7 62 0.7
        8 58 0.4
        9 54 0.2
        10 and thereafter 50 0
    29. cc. customs duties on originating goods classified under the tariff lines indicated with "R4" shall be reduced as follows:
      1. i. the customs duties shall be reduced to 39 per cent ad valorem on the date of entry into force of this Agreement;
      2. ii. the customs duties shall be reduced to 20 per cent ad valorem from the level set out in subparagraph (i) in nine equal annual instalments beginning on 1 April of the second year;
      3. iii. the customs duties shall be reduced to 9 per cent ad valorem from the level set out in subparagraph (ii) in six equal annual instalments beginning on 1 April of the 11th year; and
      4. iv. the customs duties shall remain at 9 per cent ad valorem from the 16th year;
    30. dd. customs duties on originating goods classified under the tariff lines indicated with "R5" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 50 per cent of the base rate in 11 equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the 11th year;
    31. ee. customs duties on originating goods classified under the tariff lines indicated with "R6" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 50 per cent of the base rate in six equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the sixth year;
    32. ff. customs duties on originating goods classified under the tariff lines indicated with "R7" shall be reduced by 5 per cent of the base rate on the date of entry into force of this Agreement and shall remain at that level thereafter;
    33. gg. customs duties on originating goods classified under the tariff lines indicated with "R8" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 25 per cent of the base rate in six equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the sixth year;
    34. hh. customs duties on originating goods classified under the tariff lines indicated with "R9" shall be reduced as follows:
      1. i. the customs duties shall be reduced to 5 per cent of the base rate as set out in the table below in six equal annual instalments beginning on the date of entry into force of this Agreement; and
        Year Customs duties other than the levy (yen/kg) Levy (yen/kg)
        1 77.43 255.87
        2 62.87 207.73
        3 48.30 159.60
        4 33.73 111.47
        5 19.17 63.33
        6 4.60 15.20
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the sixth year;
    35. ii. customs duties on originating goods classified under the tariff lines indicated with "R10" shall be reduced as follows:
      1. i. the customs duties shall be reduced to 5 per cent of the base rate as set out in the table below in six equal annual instalments beginning on the date of entry into force of this Agreement; and
        Year Customs duties other than the levy (yen/kg)(yen/kg) Levy (yen/kg)
        1 83.33 274.38
        2 67.65 222.77
        3 51.98 171.15
        4 36.30 119.53
        5 20.62 67.92
        6 4.95 16.30
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the sixth year;
    36. jj. customs duties on originating goods classified under the tariff lines indicated with "R11" shall be reduced as follows:
      1. i. the customs duties shall be reduced to 35 per cent ad valorem and 40 yen per kilogramme on the date of entry into force of this Agreement;
      2. ii. the customs duties shall be reduced by 70 per cent of the level set out in subparagraph (i) in 10 equal annual instalments beginning on 1 April of the second year; and
      3. iii. the customs duties shall remain at the level set out in subparagraph (ii) from the 11th year;
    37. kk. customs duties on originating goods classified under the tariff lines indicated with "R12" shall be reduced as follows:
      1. i. the customs duties shall be reduced to 25 per cent ad valorem and 40 yen per kilogramme on the date of entry into force of this Agreement;
      2. ii. the customs duties shall be reduced by 70 per cent of the level set out in subparagraph (i) in 10 equal annual instalments beginning on 1 April of the second year; and
      3. iii. the customs duties shall remain at the level set out in subparagraph (ii) from the 11th year;
    38. ll. customs duties on originating goods classified under the tariff lines indicated with "R13" shall be reduced by 15 per cent of the base rate on the date of entry into force of this Agreement and shall remain at that level thereafter;
    39. mm. customs duties on originating goods classified under the tariff lines indicated with "R14" shall be reduced by 25 per cent of the base rate on the date of entry into force of this Agreement and shall remain at that level thereafter;
    40. nn. customs duties on originating goods classified under the tariff lines indicated with "R15" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 15 per cent of the base rate in six equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the sixth year;
    41. oo. customs duties on originating goods classified under the tariff lines indicated with "R16" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 50 per cent of the base rate in four equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the fourth year;
    42. pp. customs duties on originating goods classified under the tariff lines indicated with "R17" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 75 per cent of the base rate in 11 equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the 11th year;
    43. qq. customs duties on originating goods classified under the tariff lines indicated with "R18" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 10 per cent of the base rate in six equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the sixth year;
    44. rr. customs duties on originating goods classified under the tariff lines indicated with "R19" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 75 per cent of the base rate in six equal annual instal ments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the sixth year;
    45. ss. customs duties on originating goods classified under the tariff lines indicated with "R20" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 60 per cent of the base rate in six equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the sixth year;
    46. tt. customs duties on originating goods classified under the tariff lines indicated with "R21" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 63 per cent of the base rate in six equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the sixth year;
    47. uu. customs duties on originating goods classified under the tariff lines indicated with "R22" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 66.6 per cent of the base rate in six equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the sixth year;
    48. vv. customs duties on originating goods classified under the tariff lines indicated with "R23" shall be reduced as follows:
      1. i. the customs duties shall be reduced by 67 per cent of the base rate in six equal annual instalments beginning on the date of entry into force of this Agreement; and
      2. ii. the customs duties shall remain at the level set out in subparagraph (i) from the sixth year;
    49. ww. customs duties on originating goods classified under the tariff lines indicated with "TRQ" shall be governed by the terms of tariff rate quota applicable to that tariff line, as set out in Section B;
    50. xx. customs duties on originating goods classified under the tariff lines indicated with "Xb" shall be excluded from any commitment of tariff elimination or reduction, and remain at the base rate;
    51. yy. originating goods classified under the tariff lines indicated with "Xq1", for which tariff rate quotas are set out in Japan's Schedule to the WTO Agreement, shall be excluded from any tariff commitment under this Agreement;
    52. zz. originating goods classified under the tariff lines indicated with "Xq2", for which tariff rate quotas are set out by relevant cabinet orders of Japan, shall be excluded from any tariff commitment under this Agreement; and
    53. aaa. originating goods classified under the tariff lines indicated with "X" shall be excluded from any tariff commitment referred to in paragraph 1 of Part 1 and subparagraphs (a) to (xx).
  2. 2. Originating goods classified under the tariff lines indicated with "SG-n" in Column "Note" in the Schedule of Japan shall be subject to the provisions of Section C.
  3. 3. The treatment of originating goods classified under the tariff lines indicated with "S" in Column "Note" in the Schedule of Japan shall be subject to review pursuant to paragraphs 3 and 4 of Article 2.8.
  4. 4. Paragraph 6 of Part 1 shall not be applied to the case of customs duties on originating goods classified under the tariff lines 210610.219 and 210690.283.

SECTION B

Tariff rate quotas of Japan
  1. 1. General provisions
    1. a.For the purposes of subparagraph 1(ww) of Section A, customs duties on originating goods classified under the tariff lines indicated with "TRQ-n" in Column "Note" in the Schedule of Japan shall be governed by the terms of the tariff rate quota (TRQ) for that specific tariff line, as set out in this Section, beginning on the date of entry into force of this Agreement.
    2. b.For the purposes of implementing the TRQ set out in this Section, where the first year is less than 12 months, the aggregate quota quantity for the first year set out in each TRQ shall be reduced to a part of the aggregate quota quantity that is proportional to the number of complete months remaining in the first year. For the purposes of this subparagraph, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0), provided that the unit specified in relevant provisions in this Section shall apply.
    3. c.In this Section, the descriptions of product or products in the title of each TRQ are not necessarily exhaustive. These descriptions are included solely to assist users in understanding this Section and shall not alter or supersede the coverage for each TRQ established by reference to the relevant tariff lines.
  2. 2. TRQ-1: Wheat products
    1. a.The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (c) that shall be duty-free, subject to an import mark-up applied by Japan as provided for in subparagraph (d), is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 100
      2 120
      3 140
      4 160
      5 180
      6 200
      For the seventh year and for each subsequent year, the aggregate quota quantity shall remain at 200 metric tonnes.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 190410.221, 190420.221, 190430.010, 190490.210 and 210690.214.
    4. d. TRQ-1 shall be established outside the tariff rate quota set out in Japan's Schedule to the WTO Agreement and shall be administered by the Ministry of Agriculture, Forestry and Fisheries of Japan (hereinafter referred to in this Section as "MAFF"), or its successor, as a State Trading Enterprise using a simultaneous buy-sell (hereinafter referred to in this Section as "SBS") mechanism. Japan may collect the import mark-up for goods imported under the TRQ-1. The amount of the import mark-up shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.
  3. 3. TRQ-2: Mixes and doughs and cake mixes
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (c) that shall be duty-free is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 10,400
      2 11,160
      3 11,920
      4 12,680
      5 13,440
      6 14,200
      For the seventh year and for each subsequent year, the aggregate quota quantity shall remain at 14,200 metric tonnes.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c.Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 190120.222, 190120.232, 190120.235 and 190120.243.
    4. d. TRQ-2 shall be administered by Japan, in a non-discriminatory manner, through a firstcome, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  4. 4. TRQ-3: Food preparations made primarily of wheat
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (c) that shall be duty-free is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 2,000
      2 2,200
      3 2,400
      4 2,600
      5 2,800
      6 3,000
      For the seventh year and for each subsequent year, the aggregate quota quantity shall remain at 3,000 metric tonnes.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 190190.242, 190190.247, 190190.252 and 190190.267.
    4. d. TRQ-3 shall be administered by Japan, in a non-discriminatory manner, through a firstcome, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  5. 5. TRQ-4: Wheat flour, pellets, rolled and food preparations
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (c) that shall be duty-free, subject to an import mark-up applied by Japan as provided for in subparagraph (d), is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 3,700
      2 3,800
      3 3,900
      4 4,000
      5 4,100
      6 4,200
      For the seventh year and for each subsequent year, the aggregate quota quantity shall remain at 4,200 metric tonnes.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 110100.011, 110100.091, 110290.210, 110311.010, 110319.210, 110320.110, 110320.510, 110419.111, 110419.121, 110429.111, 110429.121, 110811.010, 190120.131, 190120.151, 190190.151 and 190190.171.
    4. d. TRQ-4 shall be established outside the tariff rate quota set out in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism. Japan may collect the import mark-up for goods imported under the TRQ-4. The amount of the import mark-up shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.
  6. 6. TRQ-5: Wheat
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (c) that shall be duty-free, subject to an import mark-up applied by Japan as provided for in subparagraphs (e) and (f), and the maximum import mark-up to set the minimum selling price for each year for those goods are set out in the table below:
      Year Aggregate quota quantity (metric tonnes) Maximum import mark-up to set the minimum selling price (yen/kg)
      1 200 16.2
      2 212 15.3
      3 223 14.5
      4 235 13.6
      5 247 12.8
      6 258 11.9
      7 270 11.1
      8 270 10.2
      9 270 9.4
      For the 10th year and for each subsequent year, the aggregate quota quantity shall remain at 270 metric tonnes. For the 10th year and for each subsequent year, the maximum import mark-up to set the minimum selling price shall remain at 9.4 yen per kilogramme for the originating goods.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 100111.010, 100119.010, 100191.011, 100191.019, 100199.011, 100199.019 and 100860.210.
    4. d. TRQ-5 shall be established outside the tariff rate quota set out in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism.
    5. e. For the purposes of TRQ-5, "maximum import mark-up to set the minimum selling price" means the maximum amount that MAFF, or its successor, may add to the amount paid for goods when it sets the minimum selling price at or above which MAFF, or its successor, shall not reject a bid in an SBS tender unless the tender amount in the SBS tender is fully subscribed through higher bids.
    6. f.The difference between the amount paid by the purchaser in an SBS transaction for goods and the amount paid by MAFF, or its successor, for the goods shall be retained by MAFF, or its successor, as the import mark-up for the goods, which can be more than the maximum import mark-up to set the minimum selling price but shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.
  7. 7. TRQ-6: Udon
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff line set out in subparagraph (c) that shall be duty-free is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 10
      For the second year and for each subsequent year, the aggregate quota quantity shall remain at 10 metric tonnes.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff line set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff line 190219.092.
    4. d. TRQ-6 shall be administered by Japan, in a non-discriminatory manner, through a firstcome, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  8. 8. TRQ-7: Barley flour, groats and pellets
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (c) that shall be duty-free, subject to an import mark-up applied by Japan as provided for in subparagraph (d), is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 100
      2 120
      3 140
      4 160
      5 180
      6 200
      For the seventh year and for each subsequent year, the aggregate quota quantity shall remain at 200 metric tonnes.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 110290.110, 110319.110, 110320.410, 110419.410, 110429.410 and 190410.231.
    4. d. TRQ-7 shall be established outside the tariff rate quota set out in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism. Japan may collect the import mark-up for goods imported under the TRQ-7. The amount of the import mark-up shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.
  9. 9. TRQ-8: Food preparations of barley
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (c) that shall be duty-free, subject to an import mark-up applied by Japan as provided for in subparagraph (d), is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 100
      2 120
      3 140
      4 160
      5 180
      6 200
      For the seventh year and for each subsequent year, the aggregate quota quantity shall remain at 200 metric tonnes.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 190120.141, 190190.161, 190420.231, 190490.310 and 210690.216.
    4. d. TRQ-8 shall be established outside the tariff rate quota set out in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism. Japan may collect the import mark-up for goods imported under the TRQ-8. The amount of the import mark-up shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.
  10. 10. TRQ-9: Barley
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (c) that shall be duty-free, subject to an import mark-up applied by Japan as provided for in subparagraphs (e) and (f), and the maximum import mark-up to set the minimum selling price for each year for those goods are set out in the table below:
      Year Aggregate quota quantity (metric tonnes)(metric tonnes) Maximum import mark-up to set the minimum selling price (yen/kg)
      1 30 7.6
      2 30 7.2
      3 30 6.8
      4 30 6.4
      5 30 6.0
      6 30 5.6
      7 30 5.2
      8 30 4.8
      9 30 4.4
      For the 10th year and for each subsequent year, the aggregate quota quantity shall remain at 30 metric tonnes. For the 10th year and for each subsequent year, the maximum import mark-up to set the minimum selling price shall remain at 4.4 yen per kilogramme.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 100310.010 and 100390.019.
    4. d. TRQ-9 shall be established outside the tariff rate quota set out in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism. A longer shipping period based on a trading contract between an importer and a producer shall be allowed.
    5. e. For the purposes of TRQ-9, "maximum import mark-up to set the minimum selling price" means the maximum amount that MAFF, or its successor, may add to the amount paid for goods when it sets the minimum selling price at or above which MAFF, or its successor, shall not reject a bid in an SBS tender unless the tender amount in the SBS tender is fully subscribed through higher bids.
    6. f. The difference between the amount paid by the purchaser in an SBS transaction for goods and the amount paid by MAFF, or its successor, for the goods shall be retained by MAFF, or its successor, as the import mark-up for the goods, which can be more than the maximum import mark-up to set the minimum selling price but shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.
  11. 11. TRQ-10: Malt
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (c) that shall be duty-free is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 185,700
      For the second year and for each subsequent year, the aggregate quota quantity shall remain at 185,700 metric tonnes.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 110710.029 and 110720.020.
    4. d. TRQ-10 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  12. 12. TRQ-11: Coffee, tea mixes, food preparations and doughs
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (c) that shall be duty-free is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 1,270
      2 1,321
      3 1,372
      4 1,423
      5 1,474
      6 1,525
      7 1,576
      8 1,627
      9 1,678
      10 1,729
      11 1,780
      For the 12th year and for each subsequent year, the aggregate quota quantity shall remain at 1,780 metric tonnes.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 170290.219, 190120.239, 190190.217, 190190.248, 190190.253, 210112.110, 210112.246, 210120.246, 210690.251, 210690.271, 210690.272 and 210690.281.
    4. d. TRQ-11 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  13. 13. TRQ-12: Food preparations
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff line set out in subparagraph (c) that shall be duty-free is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 150.0
      2 157.5
      3 165.0
      4 172.5
      5 180.0
      6 187.5
      7 195.0
      8 202.5
      9 210.0
      10 217.5
      11 225.0
      For the 12th year and for each subsequent year, the aggregate quota quantity shall remain at 225 metric tonnes.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff line set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff line 210690.590.
    4. d. TRQ-12 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  14. 14. TRQ-13: Glucose and fructose
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (d) is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 1,780
      2 2,136
      3 2,492
      4 2,848
      5 3,204
      6 3,560
      7 3,916
      8 4,272
      9 4,628
      10 4,984
      11 5,340
      For the 12th year and for each subsequent year, the aggregate quota quantity shall remain at 5,340 metric tonnes.
    2. b.
      1. i. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (d)(i) shall be duty-free.
      2. ii. The in-quota rate of customs duty other than the levy on originating goods of the European Union classified under the tariff lines set out in subparagraph (d)(ii) shall be 21.5 yen per each kilogramme of the sugar portion of those originating goods, on which Japan may charge a levy. The rate of that levy shall be no greater than that of a levy applicable at the time of importation on originating goods classified under the tariff line 170199.200. The sugar portion of those originating goods of the European Union classified under the tariff lines set out in subparagraph (d)(ii) shall be determined by the weight of sucrose (dry matter basis), contained in those originating goods.
    3. c. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (d) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    4. d.
      1. i. Subparagraphs (a), (b)(i) and (c) shall apply to the originating goods classified under the tariff lines 170230.221, 170230.229, 170240.220, 170260.220 and 170290.529.
      2. ii. Subparagraphs (a), (b)(ii) and (c) shall apply to the originating goods classified under the tariff lines 170230.210, 170240.210 and 170260.210.
    5. e. TRQ-13 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  15. 15. TRQ-14: Food preparations
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff line set out in subparagraph (c) and the in-quota rate of customs duty for each year are set out in the table below:
      Year Aggregate quota quantity (metric tonnes) In-quota rate of customs duty (%)
      1 3,500 14.0
      2 3,850 14.0
      3 4,200 14.0
      4 4,550 14.0
      5 4,900 14.0
      6 5,250 14.0
      7 5,600 14.0
      8 5,950 14.0
      9 6,300 14.0
      10 6,650 14.0
      11 7,000 14.0
      For the 12th year and for each subsequent year, the aggregate quota quantity shall remain at 7,000 metric tonnes. For the 12th year and for each subsequent year, the in-quota rate of customs duty shall remain at 14.0%
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff line set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff line 190190.211.
    4. d. TRQ-14 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  16. 16. TRQ-15: Food preparations containing more than 50 per cent of sucrose, and cocoa powder
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (d) is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 100
      2 103
      3 106
      4 109
      5 112
      6 115
      7 118
      8 121
      9 124
      10 127
      11 130
      For the 12th year and each subsequent year, the aggregate quota quantity shall remain at 130 metric tonnes.
    2. b.
      1. i. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 170113.000, 170114.190, 200540.190, 200551.190, 200599.119, 210690.282 and 210690.510 shall be duty-free.
      2. ii. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 190190.219 and 210690.284 shall be reduced as follows:
        Year In-quota rate of customs duty (%)
        1 28.7
        2 27.6
        3 26.5
        4 25.4
        5 24.3
        6 23.3
        7 22.2
        8 21.1
        9 20.0
        10 18.9
        11 17.9
        For the 12th year and for each subsequent year, the in-quota rate of customs duty shall remain at 17.9%.
      3. iii. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff line 180610.100 shall be reduced as follows:
        Year In-quota rate of customs duty (%)
        1 28.4
        2 27.0
        3 25.7
        4 24.3
        5 23.0
        6 21.6
        7 20.3
        8 18.9
        9 17.6
        10 16.2
        11 14.9
        For the 12th year and for each subsequent year, the in-quota rate of customs duty shall remain at 14.9%.
    3. c. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (d) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    4. d. Subparagraphs (a) to (c) shall apply to the originating goods classified under the tariff lines 170113.000, 170114.190, 180610.100, 190190.219, 200540.190, 200551.190, 200599.119, 210690.282, 210690.284 and 210690.510.
    5. e. TRQ-15 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  17. 17. TRQ-16: Sugar
    1. a. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) shall be duty-free, subject to levies which shall be refunded in accordance with the laws and regulations of Japan, when:
      1. i. the aggregate volume of the originating goods imported from the European Union in any year does not exceed the aggregate quota quantity set out in the table below; and
        Year Aggregate quota quantity (metric tonnes)
        1 500
        For the second year and for each subsequent year, the aggregate quota quantity shall remain at 500 metric tonnes.
      2. ii. the originating goods are imported with certificate of product testing and development which certifies the originating goods meet criteria and conditions set out in the laws and regulations of Japan.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a)(i) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 170112.100, 170112.200, 170114.110, 170114.200, 170191.000, 170199.100, 170199.200, 170290.110, 170290.211, 170290.521 and 210690.221.
    4. d. TRQ-16 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  18. 18. TRQ-17: Starch
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (d) is set out in the table below:
      Year Aggregate quota quantity (metric tonnes)
      1 6,400
      2 6,550
      3 6,700
      4 6,850
      5 7,000
      6 7,150
      For the seventh year and for each subsequent year, the aggregate quota quantity shall remain at 7,150 metric tonnes.
    2. b.
      1. i. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 110812.090, 110813.090, 110814.090, 110819.019 and 110819.099 shall be duty-free, subject to levy of up to 25 per cent, only if those originating goods are imported for manufacturing starch sugar, dextrin, dextrin glue, dissolve starch, roasted starch or starch glue.
      2. ii. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff line 110813.090 imported for other purposes than those stipulated in subparagraph (b)(i) shall be duty-free only if those originating goods are imported under the following condition:
        1. A. those originating goods are not used directly for retail sale or food service industry (1); or
        2. B. the quota quantity to be allocated for each application made by an importer shall not exceed the limit of three multiplied by the quantity of the potato starch, specified in application, produced from domestic potato and used by the importer in Japan
      3. iii. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff line 110820.090 shall be duty-free.
      4. iv. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff line 110812.090 imported for other purposes than those stipulated in subparagraph (b)(i) shall be 12.5 per cent.
      5. v. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 190120.159 (not containing added sugar) and 190190.179 (not containing added sugar) shall be 16 per cent.
      6. vi. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 110814.090, 110819.019 and 110819.099 imported for other purposes than those stipulated in subparagraph (b)(i) shall be 25 per cent.
      7. vii. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 190120.159 (containing added sugar) and 190190.179 (containing added sugar) shall be 25 per cent.
    3. c. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (d) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    4. d. Subparagraphs (a) to (c) shall apply to the originating goods classified under the tariff lines 110812.090, 110813.090, 110814.090, 110819.019, 110819.099, 110820.090, 190120.159 and 190190.179.
    5. e. TRQ-17 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

      Footnotes:

      (1)The imports under subparagraph (b)(ii)(A) are to be certified by the Government of Japan as not being used directly for retail sale or food service industry on a certificate of tariff rate quota.

  19. 19. TRQ-18: Prepared edible fats and oils
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff line set out in subparagraph (c) and the in-quota rate of customs duty for each year are set out in the table below:
      Year Aggregate quota quantity (metric tonnes) In-quota rate of customs duty (%)
      1 360 20.3
      2 380 19.4
      3 400 18.4
      4 420 17.4
      5 440 16.5
      6 460 15.5
      7 480 14.5
      8 500 13.6
      9 520 12.6
      10 540 11.6
      11 560 10.7
      For the 12th year and for each subsequent year, the aggregate quota quantity shall remain at 560 metric tonnes. For the 12th year and for each subsequent year, the inquota rate of customs duty shall remain at 10.7%.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff line set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff line 210690.291.
    4. d. TRQ-18 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  20. 20. TRQ-19: Food preparations containing cocoa
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff line set out in subparagraph (c) and the in-quota rate of customs duty for each year are set out in the table below
      Year Aggregate quota quantity (metric tonnes) In-quota rate of customs duty (%)
      1 580 20.3
      2 580 19.4
      3 580 18.4
      4 580 17.4
      5 580 16.5
      6 580 15.5
      7 580 14.5
      8 580 13.6
      9 580 12.6
      10 580 11.6
      11 580 10.7
      For the 12th year and for each subsequent year, the aggregate quota quantity shall remain at 580 metric tonnes. For the 12th year and for each subsequent year, the inquota rate of customs duty shall remain at 10.7%.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff line set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff line 180620.290.
    4. d. TRQ-19 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  21. 21. TRQ-20: Food preparations containing cocoa (for the preparation of chocolate)
    1. a. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff line set out in subparagraph (c) shall be duty-free, when:
      1. i. the aggregate volume of the originating goods imported from the European Union in any year does not exceed the aggregate quota quantity set out in the table below; and
        Year Aggregate quota quantity (metric tonnes)
        1 440
        2 526
        3 612
        4 698
        5 784
        6 870
        7 956
        8 1,042
        9 1,128
        10 1,214
        11 1,300
        For the12th year and for each subsequent year, the aggregate quota quantity shall remain at 1,300 metric tonnes.
      2. ii. the quota quantity to be allocated for each application made by an importer shall not exceed the limit of three multiplied by the quantity of the milk powder, specified in application, produced from domestic milk and used by the importer for the production of chocolate in Japan.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff line set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a)(i) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff line 180620.290.
    4. d. TRQ-20 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  22. 22. TRQ-21: Evaporated milk
    1. a. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) shall be duty-free, when:
      1. i. the aggregate volume of the originating goods imported from the European Union in any year does not exceed the aggregate quota quantity set out in the table below; and
        Year Aggregate quota quantity (metric tonnes)
        1 780
        2 1,124
        3 1,468
        4 1,812
        5 2,156
        6 2,500
        For the seventh year and for each subsequent year, the aggregate quota quantity shall remain at 2,500 metric tonnes.
      2. ii. the originating goods are liquid at ordinary temperature, approximately from 1 to 32 degrees Celsius.
    2. b. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (c) imported in excess of the aggregate quota quantity set out in subparagraph (a)(i) shall be excluded from any tariff commitment under this Agreement.
    3. c. Subparagraphs (a) and (b) shall apply to the originating goods classified under the tariff lines 040291.129 and 040291.290.
    4. d. TRQ-21 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  23. 23. TRQ-22: Whey
    1. a. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 040410.139, 040410.149, 040410.189, 040490.118, 040490.128 and 040490.138 shall be duty-free. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 040410.129 and 040410.169 shall be eliminated as follows:
      Year In-quota rate of customs duty (containing added sugar) (%) In-quota rate of customs duty (not containing added sugar) (%)
      1 31.8 22.7
      2 28.6 20.5
      3 25.5 18.2
      4 22.3 15.9
      5 19.1 13.6
      6 0.0 0.0
      For the seventh year and for each subsequent year, the in-quota rate of customs duty shall remain at zero.
    2. b. The in-quota rate of customs duty set out in subparagraph (a) shall be applied when:
      1. i. the aggregate volume of the originating goods imported from the European Union in any year does not exceed the aggregate quota quantity set out in the table below; and
        Year Aggregate quota quantity (metric tonnes)
        1 6,200
        2 6,520
        3 6,840
        4 7,160
        5 7,480
        6 7,800
        7 8,120
        8 8,440
        9 8,760
        10 9,080
        11 9,400
        For the 12th year and for each subsequent year, the aggregate quota quantity shall remain at 9,400 metric tonnes.
      2. ii. the following condition is satisfied:
        1. A. the ash content of the originating goods classified under the tariff lines 040410.129 and 040410.169 are more than or equal to 11 per cent;
        2. B. the originating goods classified under the tariff lines 040410.149, 040410.189, 040490.118, 040490.128 and 040490.138 are whey and products consisting of natural milk constitutions, used for infant formula; or
        3. C. the originating goods classified under the tariff lines 040410.139 and 040410.149 are whey permeate with protein content less than 5 per cent.
    3. c. The rate of customs duty on originating goods of the European Union classified under the tariff lines 040410.129, 040410.139, 040410.149, 040410.169 and 040410.189 imported in excess of the aggregate quota quantity set out in subparagraph (b)(i) shall be determined in accordance with categories "R11" and "R12" for the originating goods containing a milk protein content of less than 25 per cent and the originating goods containing a milk protein content equal to or greater than 25 per cent but less than 45 per cent, "B5****" and "B5*****" for the originating goods containing a milk protein content equal to or greater than 45 per cent or "A" for the originating goods for manufacturing mixed feeds containing added colouring matter, as set out in subparagraphs 1(jj), 1(kk), 1(g), 1(h) and 1(a) respectively of Section A. The rate of customs duty on originating goods of the European Union classified under the tariff lines 040490.118, 040490.128 and 040490.138 imported in excess of the aggregate quota quantity set out in subparagraph (b)(i) shall be excluded from any tariff commitment under this Agreement.
    4. d. Subparagraphs (a) to (c) shall apply to the originating goods classified under the tariff lines 040410.129, 040410.139, 040410.149, 040410.169, 040410.189, 040490.118, 040490.128 and 040490.138.
    5. e. TRQ-22 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  24. 24. TRQ-23: Butter, skimmed milk powder, milk powder, butter milk powder and condensed milk
    1. a. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (e), expressed in terms of whole milk equivalent (metric tonnes) calculated with a conversion factor listed in subparagraph (c) is set out in the table below:
      Year Aggregate quota quantity (whole milk equivalent (metric tonnes))
      1 12,857
      2 13,286
      3 13,714
      4 14,143
      5 14,571
      6 15,000
      For the seventh year and for each subsequent year, the aggregate quota quantity shall remain at 15,000 whole milk equivalent (metric tonnes).
    2. b.
      1. i. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 040510.129, 040510.229, 040520.090, 040590.190 and 040590.229 shall be reduced as follows:
        Year In-quota rate of customs duty for butter
        1 35% + 290 yen/kg
        2 35% + 261 yen/kg
        3 35% + 232 yen/kg
        4 35% + 203 yen/kg
        5 35% + 174 yen/kg
        6 35% + 145 yen/kg
        7 35% + 116 yen/kg
        8 35% + 87 yen/kg
        9 35% + 58 yen/kg
        10 35% + 29 yen/kg
        11 35%
        For the 12th year and for each subsequent year, the in-quota rate of customs duty shall remain at 35%.
      2. ii. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 040210.129, 040210.212, 040210.229, 040221.212, 040221.229 and 040229.291 shall be reduced as follows:
        Year In-quota rate of customs duty for skimmed milk powder (not containing added sugar) In-quota rate of customs duty for skimmed milk powder (containing added sugar)
        1 25% + 130 yen/kg 35% + 130 yen/kg
        2 25% + 117 yen/kg 35% + 117 yen/kg
        3 25% + 104 yen/kg 35% + 104 yen/kg
        4 25% + 91 yen/kg 35% + 91 yen/kg
        5 25% + 78 yen/kg 35% + 78 yen/kg
        6 25% + 65 yen/kg 35% + 65 yen/kg
        7 25% + 52 yen/kg 35% + 52 yen/kg
        8 25% + 39 yen/kg 35% + 39 yen/kg
        9 25% + 26 yen/kg 35% + 26 yen/kg
        10 25% + 13 yen/kg 35% + 13 yen/kg
        11 25% 35%
        For the 12th year and for each subsequent year, the in-quota rate of customs duty shall remain at 25% for skimmed milk powder not containing added sugar, or 35% for skimmed milk powder containing added sugar.
      3. iii. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 040221.119, 040221.129, 040229.119, 040229.129, 040390.113, 040390.123 and 040390.133 shall be reduced as follows:
        Year In-quota rate of customs duty for butter milk powder (not containing added sugar) In-quota rate of customs duty for butter milk powder (containing added sugar) In-quota rate of customs duty for milk powder
        1 25% + 200 yen/kg 35% + 200 yen/kg 30% + 210 yen/kg
        2 25% + 180 yen/kg 35% + 180 yen/kg 30% + 189 yen/kg
        3 25% + 160 yen/kg 35% + 160 yen/kg 30% + 168 yen/kg
        4 25% + 140 yen/kg 35% + 140 yen/kg 30% + 147 yen/kg
        5 25% + 120 yen/kg 35% + 120 yen/kg 30% + 126 yen/kg
        6 25% + 100 yen/kg 35% + 100 yen/kg 30% + 105 yen/kg
        7 25% + 80 yen/kg 35% + 80 yen/kg 30% + 84 yen/kg
        8 25% + 60 yen/kg 35% + 60 yen/kg 30% + 63 yen/kg
        9 25% + 40 yen/kg 35% + 40 yen/kg 30% + 42 yen/kg
        10 25% + 20 yen/kg 35% + 20 yen/kg 30% + 21 yen/kg
        11 25% 35% 30%
        For the 12th year and for each subsequent year, the in-quota rate of customs duty shall remain at 25% for butter milk powder not containing added sugar, 35% for butter milk powder containing added sugar, or 30% for milk powder.
      4. iv. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 040299.129 and 040299.290 shall be duty-free.
    3. c. For the purposes of TRQ-23, the conversion factor set out in the right column of the table below indicates the coefficient for a calculation to obtain the weight in whole milk equivalent of the respective originating goods classified under the tariff lines set out in the left column of the table below:
      Tariff line Conversion factor
      040210.129 6.48
      040210.212 6.48
      040210.229 6.48
      040221.119 8.9
      040221.129 13.43
      040221.212 6.84
      040221.229 6.84
      040229.119 8.9
      040229.129 13.43
      040229.291 6.84
      040299.129 6.69
      040299.290 3.65
      040390.113 6.48
      040390.123 8.57
      040390.133 13.43
      040510.129 12.34
      040510.229 15.05
      040520.090 12.34
      040590.190 12.34
      040590.229 15.05
    4. d. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (e) imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be excluded from any tariff commitment under this Agreement.
    5. e. Subparagraphs (a) to (d) shall apply to the originating goods classified under the tariff lines 040510.129, 040510.229, 040520.090, 040590.190, 040590.229, 040210.129, 040210.212, 040210.229, 040221.212, 040221.229, 040229.291, 040221.119, 040221.129, 040229.119, 040229.129, 040390.113, 040390.123, 040390.133, 040299.129 and 040299.290.
    6. f. TRQ-23 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  25. 25. TRQ-24: Milk powder (for the preparation of chocolate)
    1. a. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (d) shall be duty-free, when:
      1. i. the aggregate volume of the originating goods imported from the European Union in any year does not exceed the aggregate quota quantity, expressed in terms of whole milk equivalent (metric tonnes) calculated with a conversion factor listed in subparagraph (b), set out in the table below; and
        Year Aggregate quota quantity (whole milk equivalent (metric tonnes))
        1 5,242
        2 6,312
        3 7,382
        4 8,451
        5 9,521
        6 10,591
        7 11,661
        8 12,731
        9 13,800
        10 14,870
        11 15,940
        For the 12th year and for each subsequent year, the aggregate quota quantity shall remain at 15,940 whole milk equivalent (metric tonnes).
      2. ii. the quota quantity to be allocated for each application made by an importer shall not exceed the limit of three multiplied by the quantity of the milk powder, specified in application, produced from domestic milk and used by the importer for the production of chocolate in Japan.
    2. b. For the purposes of TRQ-24, the conversion factor set out in the right column of the table below indicates the coefficient for a calculation to obtain the weight in whole milk equivalent of the respective originating goods classified under the tariff lines set out in the left column of the table below:
      Tariff line Conversion factor
      040221.119 8.9
      040221.129 13.43
    3. c. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (d) imported in excess of the aggregate quota quantity set out in subparagraph (a)(i) shall be excluded from any tariff commitment under this Agreement.
    4. d. Subparagraphs (a) to (c) shall apply to the originating goods classified under the tariff lines 040221.119 and 040221.129.
    5. e. TRQ-24 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.
  26. 26. TRQ-25: Cheeses
    1. a.
      1. i. The aggregate quota quantity in a particular year of originating goods of the European Union classified under the tariff lines set out in subparagraph (d) from the first year until the 16th year is set out in the table below:
        Year Aggregate quota quantity (metric tonnes)
        1 20,000
        2 20,600
        3 21,200
        4 21,800
        5 22,500
        6 23,200
        7 23,900
        8 24,600
        9 25,300
        10 26,100
        11 26,900
        12 27,700
        13 28,500
        14 29,300
        15 30,200
        16 31,000
      2. ii. From the 17th year, the aggregate quota quantity for each year shall be calculated every five years based on the calculation method set out in subparagraphs (A) to (C), and shall be stipulated by laws, regulations or ministerial ordinances of Japan:
        1. A. if there is a positive growth in total cheese consumption in Japan over the six preceding fiscal years (1), the aggregate quota quantity for each of the next five years shall be calculated based on the compound annual growth rate in total cheese consumption in Japan over the six preceding fiscal years, calculated every five years in accordance with subparagraph (B) using the official statistics published by the MAFF, or its successor, and on the aggregate quota quantity in the year immediately preceding each year for which the calculation is made;
        2. B. in calculating the compound annual growth rate referred to in subparagraph (A), the total cheese consumption in Japan in both the fiscal year which is two fiscal years prior to the first fiscal year of the next five fiscal years and the fiscal year which is seven fiscal years prior to the first fiscal year of the next five fiscal years shall be used; and
        3. C. if there is no positive growth in total cheese consumption in Japan over the six preceding fiscal years, the aggregate quota quantity for each of the next five years shall remain at the level in the most recent year.
    2. b.
      1. i. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff line 040610.020 shall be eliminated as follows:
        Year In-quota rate of customs duty (%)
        1 21.0
        2 19.6
        3 18.2
        4 16.8
        5 15.4
        6 14.0
        7 12.6
        8 11.2
        9 9.8
        10 8.4
        11 7.0
        12 5.6
        13 4.2
        14 2.8
        15 1.4
        16 0.0
        For the 17th year and for each subsequent year, the in-quota rate of customs duty shall remain at zero.
      2. ii. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 040610.090, 040640.090 and 040690.090 shall be eliminated as follows:
        Year In-quota rate of customs duty (%)
        1 27.9
        2 26.1
        3 24.2
        4 22.4
        5 20.5
        6 18.6
        7 16.8
        8 14.9
        9 13.0
        10 11.2
        11 9.3
        12 7.5
        13 5.6
        14 3.7
        15 1.9
        16 0.0
        For the 17th year and for each subsequent year, the in-quota rate of customs duty shall remain at zero.
      3. iii. The in-quota rate of customs duty on originating goods of the European Union classified under the tariff lines 040620.100 and 040630.000 shall be eliminated as follows:
        Year In-quota rate of customs duty (%)
        1 37.5
        2 35.0
        3 32.5
        4 30.0
        5 27.5
        6 25.0
        7 22.5
        8 20.0
        9 17.5
        10 15.0
        11 12.5
        12 10.0
        13 7.5
        14 5.0
        15 2.5
        16 0.0
        For the 17th year and for each subsequent year, the in-quota rate of customs duty shall remain at zero.
    3. c. The rate of customs duty on originating goods of the European Union classified under the tariff lines set out in subparagraph (d) imported in excess of the aggregate quota quantity set out in subparagraph (a)(i) shall be excluded from any tariff commitment under this Agreement.
    4. d. Subparagraphs (a) to (c) shall apply to the originating goods classified under the tariff lines 040610.020, 040610.090, 040640.090, 040620.100, 040630.000 and 040690.090.
    5. e. TRQ-25 shall be administered by Japan, in a non-discriminatory manner, through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan

      Footnotes:

      (1)For the purposes of TRQ-25, "fiscal year" means a Japanese fiscal year beginning on 1 April and ending on the following 31 March.

SECTION C

Agricultural safeguard measures
SUB-SECTION 1
Notes for Section C
  1. 1. This Section sets out:
    1. a. the originating agricultural goods that may be subject to agricultural safeguard measures pursuant to paragraph 2 of Section A;
    2. b. the trigger levels for applying such measures; and
    3. c. the maximum rate of customs duty that may be applied in each year for each such good.
  2. 2. Notwithstanding Article 2.8, Japan may apply an agricultural safeguard measure to the originating agricultural goods classified under the tariff lines indicated with "SG1*", "SG1**", "SG2", "SG3", "SG4*", "SG4**", "SG5" or "SG6" in Column "Note" in the Schedule of Japan. Japan may apply such measure only under the conditions set out in this Section and only in accordance with the terms set out in this Section.
  3. 3. If the conditions set out in this Section are satisfied, Japan may, as an agricultural safeguard measure, increase the rate of customs duty on such an originating agricultural good to a level not exceeding the lesser of:
    1. a. the most-favoured-nation applied rate of customs duty in effect at the time of the application of the agricultural safeguard measure;
    2. b. the most-favoured-nation applied rate of customs duty in effect on the day immediately preceding the date of entry into force of this Agreement; and
    3. c. the rate of customs duty set out in this Section.
  4. 4. Japan shall implement any agricultural safeguard measure in a transparent manner. Japan shall, within 60 days of the date of imposing the agricultural safeguard measure, notify the European Union thereof in writing and provide the European Union with relevant data concerning the measure. Japan shall, on written request of the European Union, respond to specific questions from, and provide information to, the European Union, including by e-mail, teleconference, video-conference and in person, regarding the application of the measure.
  5. 5. For greater certainty, no agricultural safeguard measure may be applied or maintained on or after the date on which the rate of customs duty referred to in subparagraph 3(c) of this Sub-Section is zero.
  6. 6. For the purposes of this Section:
    1. a. "fiscal year" means a Japanese fiscal year beginning on 1 April and ending on the following 31 March; and
    2. b. "quarter" means a period:
      1. i. from 1 April until 30 June;
      2. ii. from 1 July until 30 September;
      3. iii. from 1 October until 31 December; or
      4. iv. from 1 January until 31 March.
SUB-SECTION 2
Agricultural safeguard measure for beef
  1. 1. In accordance with paragraph 2 of Sub-Section 1, with respect to the originating agricultural goods classified under the tariff lines indicated with "SG1*" in Column "Note" in the Schedule of Japan (hereinafter referred to in this Sub-Section as "SG1* goods") or the originating agricultural goods classified under the tariff lines indicated with "SG1**" in Column "Note" in the Schedule of Japan (hereinafter referred to in this Sub-Section as "SG1** goods"), Japan may apply an agricultural safeguard measure only if the aggregate volume of imports of those originating agricultural goods from the European Union for a particular year exceeds the trigger level set out as follows:
    1. a. 43,500 metric tonnes for the first year, except as provided in paragraph 9;
    2. b. 44,278 metric tonnes for the second year;
    3. c. 45,056 metric tonnes for the third year;
    4. d. 45,833 metric tonnes for the fourth year;
    5. e. 46,611 metric tonnes for the fifth year;
    6. f. 47,389 metric tonnes for the sixth year;
    7. g. 48,167 metric tonnes for the seventh year;
    8. h. 48,944 metric tonnes for the eighth year;
    9. i. 49,722 metric tonnes for the ninth year;
    10. j. 50,500 metric tonnes for the 10th year;
    11. k. from the 11th year until the 15th year, for each year, the trigger level of the previous year plus 385 metric tonnes; and
    12. l. from the 16th year, for each year, the trigger level of the previous year plus 770 metric tonnes.
  2. 2.
    1. a. For SG1* goods, the rate of customs duty referred to in subparagraph 3(c) of Sub-Section 1 shall be:
      1. i. 38.5 per cent from the first year until the third year;
      2. ii. 30.0 per cent from the fourth year until the 10th year;
      3. iii. 20.0 per cent from the 11th year until the 14th year;
      4. iv. 18.0 per cent for the 15th year; and
      5. v. from the 16th year:
        1. A. one percentage point less than the rate of customs duty of the previous year, if Japan did not apply an agricultural safeguard measure under this Sub-Section in the previous year; or
        2. B.the same as the rate of customs duty of the previous year, if Japan applied an agricultural safeguard measure under this Sub-Section in the previous year.
    2. b. For SG1** goods, the rate of customs duty referred to in subparagraph 3(c) of Sub-Section 1 shall be:
      1. i. 39.0 per cent for the first year;
      2. ii. 38.5 per cent for the second year and the third year;
      3. iii. 32.7 per cent for the fourth year;
      4. iv. 30.6 per cent for the fifth year;
      5. v. 30.0 per cent from the sixth year until the 10th year;
      6. vi. 20.0 per cent from the 11th year until the 14th year;
      7. vii.18.0 per cent for the 15th year; and
      8. viii.from the 16th year:
        1. A. one percentage point less than the rate of customs duty of the previous year, if Japan did not apply an agricultural safeguard measure under this Sub-Section in the previous year; or
        2. B. the same as the rate of customs duty of the previous year, if Japan applied an agricultural safeguard measure under this Sub-Section in the previous year.
    3. c. If the condition set out in paragraph 1 is satisfied in one year and, as a result thereof, an agricultural safeguard measure is in effect during the following year pursuant to subparagraph 3(b) or (c), the rate of customs duty referred to in subparagraph 3(c) of Sub-Section 1 for the purpose of that agricultural safeguard measure shall, for the duration of that measure, be set at the level applicable for the year in which the condition set out in paragraph 1 was satisfied.
  3. 3. An agricultural safeguard measure referred to in paragraph 1 may be maintained:
    1. a. if the aggregate volume of imports from the European Union of SG1* goods or SG1** goods in any fiscal year exceeds the trigger level set out in paragraph 1 prior to 31 January, until the end of that fiscal year;
    2. b. if the aggregate volume of imports from the European Union of SG1* goods or SG1** goods in any fiscal year exceeds the trigger level set out in paragraph 1 during the month of February, for a period of 45 days beginning on the date of the application of the agricultural safeguard measure; and
    3. c. if the aggregate volume of imports from the European Union of SG1* goods or SG1** goods in any fiscal year exceeds the trigger level set out in paragraph 1 during the month of March, for a period of 30 days beginning on the date of the application of the agricultural safeguard measure.
  4. 4.
    1. a. For the purposes of this Sub-Section, the period during which an agricultural safeguard measure may be maintained shall commence no later than the day following the fifth business day after the end of the publication period referred to in subparagraph (c) in which the condition set out in paragraph 1 is satisfied.
    2. b. For the purposes of this Sub-Section, as an exceptional measure taken for the implementation of this Sub-Section, the customs administration of Japan shall, no later than five business days after the end of each publication period, publish the aggregate volume of imports of SG1* goods or SG1** goods from the European Union between:
      1. i. the beginning of the fiscal year and the end of the publication period; and
      2. ii. from the 11th year until the 15th year, the beginning of the quarter and the end of the publication period.
    3. c. For the purposes of this Sub-Section, "publication period" means:
      1. i. the period from the first day of each month until the 10th day of that month;
      2. ii. the period from the 11th day of each month until the 20th day of that month; and
  5. 5.
    1. a. Notwithstanding paragraph 1, if, during any year from the 11th year until the 15th year, the aggregate volume of imports of SG1* goods or SG1** goods from the European Union in any quarter exceeds the quarterly safeguard trigger volume set out in subparagraph (b), Japan may increase the rates of customs duties on such goods in accordance with paragraph 3 of Sub-Section 1 for a period of 90 days. The 90 day period shall commence no later than the day following the fifth business day after the end of the publication period in which the aggregate quantity of imports of such goods in the quarter exceeded the quarterly safeguard trigger volume. The rate of customs duty referred to in subparagraph 3(c) of Sub-Section 1 if the condition set out in this paragraph is satisfied shall be:
      1. i. 20.0 per cent from the 11th year until the 14th year; and
      2. ii. 18.0 per cent for the 15th year.
    2. b. For the purposes of this paragraph, the "quarterly safeguard trigger volume" means 117 per cent of one fourth of the trigger level set out in subparagraph 1(k) for the respective year.
    3. c. Notwithstanding paragraph 1, if, during any year from the 11th year until the 15th year, the aggregate volume of imports of SG1* goods or SG1** goods from the European Union exceeds the trigger level set out in subparagraph 1(k) for the respective year, and at the same time as the aggregate volume of imports of those goods from the European Union in the quarter exceeds the quarterly safeguard trigger volume set out in subparagraph (b), Japan may maintain an agricultural safeguard measure under this Sub-Section until the later of the end of the 90 day period provided for in subparagraph (a) or the end of the periods provided for in paragraph 3.
  6. 6. If, during any four consecutive years after the 15th year, Japan does not apply an agricultural safeguard measure under this Sub-Section on SG1* goods, Japan shall not apply any further agricultural safeguard measures under this Sub-Section on such goods. The same applies to SG1** goods.
  7. 7. Notwithstanding paragraph 1, if the importation into Japan from the European Union of SG1* goods or SG1** goods has been wholly or substantially suspended for more than 36 months due to sanitary concerns, Japan shall not apply an agricultural safeguard measure under this Sub-Section to such goods from the European Union for 48 months after the whole or substantial lifting of the suspension. If the importation from the European Union of such goods had been suspended, and a natural disaster, such as severe drought, disrupts the recovery of the production of such goods in the European Union, the period in which Japan shall not apply an agricultural safeguard measure under this Sub-Section to such goods from the European Union shall be 60 months.
  8. 8. Japan shall not apply the tariff emergency measures on beef referred to in Article 7.5 of the Temporary Tariff Measures Law of Japan (Law No.36 of 1960) to SG1* goods.
  9. 9. If the first year is less than 12 months, the applicable trigger level for the first year for the purposes of subparagraph 1(a) shall be determined by multiplying 43,500 metric tonnes by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement and the following 31 March and the denominator of which shall be 12. For the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).
SUB-SECTION 3
Agricultural safeguard measure for pork
  1. 1. In accordance with paragraph 2 of Sub-Section 1, with respect to the originating agricultural goods classified under the tariff lines indicated with "SG2" in Column "Note" in the Schedule of Japan (hereinafter referred to in this Sub-Section as "SG2 goods"), Japan may apply an agricultural safeguard measure only if the following condition is satisfied:
    1. a. in the first year and the second year, except as provided in paragraph 6, Japan may apply an agricultural safeguard measure under this Sub-Section to SG2 goods only if the aggregate volume of imports of SG2 goods from the European Union for the respective year exceeds 112 per cent of the largest annual aggregate volume of imports of SG2 goods from the European Union during any of the preceding three fiscal years;
    2. b. in the third year and the fourth year, Japan may apply an agricultural safeguard measure under this Sub-Section to SG2 goods only if the aggregate volume of imports of SG2 goods from the European Union for the respective year exceeds 116 per cent of the largest annual aggregate volume of imports of SG2 goods from the European Union during any of the preceding three fiscal years;
    3. c. in the fifth year and the sixth year:
      1. i. Japan may apply an agricultural safeguard measure under this Sub-Section to SG2 goods imported at a price equal to or greater than the threshold price (1) for those SG2 goods only if the aggregate volume of imports of those SG2 goods from the European Union for the respective year exceeds 116 per cent of the largest annual aggregate volume of imports of those SG2 goods from the European Union during any of the preceding three fiscal years; or
      2. ii. Japan may apply an agricultural safeguard measure under this Sub-Section to SG2 goods imported at a price less than the threshold price for those SG2 goods only if the aggregate volume of imports of those SG2 goods from the European Union for the respective year exceeds:
        1. A. 63,000 metric tonnes for the fifth year; and
        2. B. 71,400 metric tonnes for the sixth year; and
    4. d. from the seventh year until the 11th year:
      1. i. Japan may apply an agricultural safeguard measure under this Sub-Section to SG2 goods imported at price equal to or greater than the threshold price for those SG2 goods only if the aggregate volume of imports of those SG2 goods from the European Union for the respective year exceeds 119 per cent of the largest annual aggregate volume of imports of those SG2 goods from the European Union during any of the preceding three fiscal years; or
      2. ii. Japan may apply an agricultural safeguard measure under this Sub-Section to SG2 goods imported at price less than the threshold price for those SG2 goods only if the aggregate volume of imports of those SG2 goods from the European Union for the respective year exceeds:
        1. A. 79,800 metric tonnes for the seventh year;
        2. B. 88,200 metric tonnes for the eighth year;
        3. C. 96,600 metric tonnes for the ninth year;
        4. D. 105,000 metric tonnes for the 10th year; and
        5. E. 105,000 metric tonnes for the 11th year.
  2. 2. For SG2 goods, the rate of customs duty referred to in subparagraph 3(c) of Sub-Section 1 shall be:
    1. a. for SG2 goods classified under the tariff lines 020311.040, 020312.022, 020319.022, 020321.040, 020322.022, 020329.022, 020630.099 and 020649.099:
      1. i. 4.0 per cent from the first year until the third year;
      2. ii. 3.4 per cent from the fourth year until the sixth year;
      3. iii. 2.8 per cent from the seventh year until the ninth year; and
      4. iv. 2.2 per cent in the 10th year and the 11th year;
    2. b. for SG2 goods classified under the tariff lines 020312.021, 020312.023, 020319.021, 020319.023, 020322.021, 020322.023, 020329.021, 020329.023, 020630.092, 020630.093, 020649.092 and 020649.093, the lesser of:
      1. i. the difference between CIF import price per kilogramme and the First Safeguard Standard Import Price (2); and
      2. ii. the first alternative rate (3); and
    3. c. for SG2 goods classified under the tariff lines 020311.020, 020311.030, 020321.020 and 020321.030, the lesser of:
      1. i. the difference between CIF import price per kilogramme and the Second Safeguard Standard Import Price (4); and
      2. ii. the second alternative rate (5)
  3. 3. Any agricultural safeguard measure applied under this Sub-Section may be maintained only until the end of the year in which the condition set out in paragraph 1 is satisfied.
  4. 4. Japan shall not apply or maintain any agricultural safeguard measure under this Sub-Section after the end of the 11th year.
  5. 5. Japan shall not apply the tariff emergency measures on pork referred to in paragraph 1 of Article 7.6 of the Temporary Tariff Measures Law of Japan (Law No. 36 of 1960) to SG2 goods.
  6. 6. If the first year is less than 12 months, the applicable trigger level set out in paragraph 1 for SG2 goods from the European Union for the first year for the purposes of subparagraph 1(a) shall be determined by multiplying 112 per cent of the largest annual aggregate volume of imports of SG2 goods from the European Union during any of the preceding three fiscal years by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement and the following 31 March and the denominator of which shall be 12. For the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).

Footnotes

  1. (1) For the purposes of subparagraphs (c) and (d), "threshold price" means:
    1. (a) 399 yen per kilogramme for the originating agricultural goods classified under the tariff lines 020312.021, 020312.023, 020319.021, 020319.023, 020322.021, 020322.023, 020329.021, 020329.023, 020630.092, 020630.093, 020649.092 and 020649.093; and
    2. (b) 299.25 yen per kilogramme for the originating agricultural goods classified under the tariff lines 020311.020, 020311.030, 020321.020 and 020321.030.
  2. (2) For the purposes of subparagraph (c), "Second Safeguard Standard Import Price" means a price equal to 393 yen per kilogramme multiplied by the sum of 100 per cent and the rate of customs duty set out in subparagraph (a) for the respective year.
  3. (3) For the purposes of subparagraph (c), "second alternative rate" means:
    1. (a) the rate of customs duty specified in the Schedule of Japan for the tariff lines 020311.020 or 020321.020 from the first year until the fourth year;
    2. (b) 75 yen per kilogramme from the fifth year until the ninth year; and
    3. (c) 52.5 yen per kilogramme for the 10th year and the 11th year.
SUB-SECTION 4
Agricultural safeguard measure for processed pork
  1. 1. In accordance with paragraph 2 of Sub-Section 1, with respect to the originating agricultural goods classified under the tariff lines indicated with "SG3" in Column "Note" in the Schedule of Japan (hereinafter referred to in this Sub-Section as "SG3 goods"), Japan may apply an agricultural safeguard measure only if the following condition is satisfied:
    1. a. in the first year and the second year, except as provided in paragraph 6, Japan may apply an agricultural safeguard measure under this Sub-Section to SG3 goods only if the aggregate volume of imports of SG3 goods from the European Union for the respective year exceeds 115 per cent of the largest annual aggregate volume of imports of SG3 goods from the European Union during any of the preceding three fiscal years;
    2. b. from the third year until the sixth year, Japan may apply an agricultural safeguard measure under this Sub-Section to SG3 goods only if the aggregate volume of imports of SG3 goods from the European Union for the respective year exceeds 118 per cent of the largest annual aggregate volume of imports of SG3 goods from the European Union during any of the preceding three fiscal years; and
    3. c. from the seventh year until the 11th year, Japan may apply an agricultural safeguard measure under this Sub-Section to SG3 goods only if the aggregate volume of imports of SG3 goods from the European Union for the respective year exceeds 121 per cent of the largest annual aggregate volume of imports of SG3 goods from the European Union during any of the preceding three fiscal years.
  2. 2.
    1. a.For SG3 goods, the rate of customs duty referred to in subparagraph 3(c) of Sub-Section 1 shall be:
      1. i. 85 per cent of the base rate from the first year until the fourth year;
      2. ii. 60 per cent of the base rate from the fifth year until the ninth year; and
      3. iii. 45 per cent of the base rate for the 10th year and the 11th year.
    2. b. For the purposes of subparagraph (a), the base rate shall be comprised of an ad valorem duty component and a specific duty component, each of which shall be reduced to the percentages identified in subparagraph (a) to determine the rate of customs duty referred to in subparagraph 3(c) of Sub-Section 1. The ad valorem duty component of the base rate shall be 8.5 per cent, and the specific duty component shall be equal to 614.85 yen per kilogramme minus 60 per cent of the CIF import price per kilogramme of the respective SG3 good.
  3. 3. Any agricultural safeguard measure applied under this Sub-Section may be maintained only until the end of the year in which the condition set out in paragraph 1 is satisfied.
  4. 4. Japan shall not apply any agricultural safeguard measure under this Sub-Section after the end of the 11th year.
  5. 5. Japan shall not apply the tariff emergency measures on pork referred to in paragraph 1 of Article 7.6 of the Temporary Tariff Measures Law of Japan (Law No. 36 of 1960) to SG3 goods.
  6. 6. If the first year is less than 12 months, the applicable trigger level set out in paragraph 1 for SG3 goods from the European Union for the first year for the purposes of subparagraph 1(a) shall be determined by multiplying 115 per cent of the largest annual aggregate volume of imports of SG3 goods from the European Union during any of the preceding three fiscal years by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement and the following 31 March and the denominator of which shall be 12. For the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).
SUB-SECTION 5
Agricultural safeguard measure for whey protein concentrate (WPC)
  1. 1. In accordance with paragraph 2 of Sub-Section 1, with respect to the originating agricultural goods classified under the tariff lines indicated with "SG4*" in Column "Note" in the Schedule of Japan, Japan may apply an agricultural safeguard measure only if the aggregate volume of imports of those originating agricultural goods from the European Union for a particular year exceeds the trigger level set out as follows:
    1. a. 2,000 metric tonnes for the first year, except as provided in paragraph 6;
    2. b. 2,133 metric tonnes for the second year;
    3. c. 2,267 metric tonnes for the third year;
    4. d. 2,400 metric tonnes for the fourth year;
    5. e. 2,533 metric tonnes for the fifth year;
    6. f. 2,667 metric tonnes for the sixth year;
    7. g. 2,800 metric tonnes for the seventh year;
    8. h. 2,933 metric tonnes for the eighth year;
    9. i. 3,067 metric tonnes for the ninth year;
    10. j. 3,200 metric tonnes for the 10th year;
    11. k. 3,544 metric tonnes for the 11th year;
    12. l. 3,888 metric tonnes for the 12th year;
    13. m. 4,232 metric tonnes for the 13th year;
    14. n. 4,690 metric tonnes for the 14th year;
    15. o. 5,148 metric tonnes for the 15th year;
    16. p. 5,606 metric tonnes for the 16th year;
    17. q. 6,064 metric tonnes for the 17th year;
    18. r. 6,522 metric tonnes for the 18th year;
    19. w. 6,980 metric tonnes for the 19th year;
    20. t. 7,438 metric tonnes for the 20th year; and
    21. u. from the 21st year, for each year, the trigger level of the previous year plus 573 metric tonnes.
  2. 2. For the originating agricultural goods classified under the tariff lines indicated with "SG4*", the rate of customs duty referred to in subparagraph 3(c) of Sub-Section 1 shall be:
    1. a. 29.8 per cent plus 120 yen per kilogramme from the first year until the fifth year;
    2. b. 23.8 per cent plus 105 yen per kilogramme from the sixth year until the 10th year;
    3. c. 19.4 per cent plus 90 yen per kilogramme from the 11th year until the 15th year;
    4. d. 13.4 per cent plus 75 yen per kilogramme from the 16th year until the 20th year; and
    5. e. from the 21st year:
      1. i. if an agricultural safeguard measure set out in this Sub-Section was not applied in the previous year, the ad valorem duty component of the rate of customs duty shall be 1.9 per cent lower than it was in the previous year and the specific duty component of the rate of customs duty shall be 10.7 yen per kilogramme lower than it was in the previous year; or
      2. ii. if an agricultural safeguard measure set out in this Sub-Section was applied in the previous year, the ad valorem duty component of the rate of customs duty shall be 1.0 per cent lower than it was in the previous year and the specific duty component of the rate of customs duty shall be 5.0 yen per kilogramme lower than it was in the previous year
  3. 3. Any agricultural safeguard measure applied under this Sub-Section may be maintained only until the end of the year in which the condition set out in paragraph 1 is satisfied.
  4. 4. If, during any three consecutive years after the 20th year, Japan does not apply an agricultural safeguard measure under this Sub-Section, Japan shall not apply any further agricultural safeguard measures under this Sub-Section.
  5. 5.
    1. a. Notwithstanding paragraph 1, Japan shall not apply any agricultural safeguard measure under this Sub-Section if:
      1. i. there is a domestic shortage of skimmed milk powder in Japan; or
      2. ii. there is no demonstrable reduction in domestic demand for skimmed milk powder in Japan.
    2. b. If Japan applies an agricultural safeguard measure under this Sub-Section when the European Union believes that either of the conditions set out in subparagraph (a) has been satisfied, the European Union may:
      1. i. ask Japan to provide an explanation of why Japan does not consider either of the conditions set out in subparagraph (a) to have been satisfied; and
      2. ii. request Japan to cease application of the agricultural safeguard measure for the remainder of the year.
  6. 6. If the first year is less than 12 months, the applicable trigger level for the first year for the purposes of subparagraph 1(a) shall be determined by multiplying 2,000 metric tonnes by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement and the following 31 March and the denominator of which shall be 12. For the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).
SUB-SECTION 6
Agricultural safeguard measure for whey powder
  1. 1. In accordance with paragraph 2 of Sub-Section 1, with respect to the originating agricultural goods classified under the tariff lines indicated with "SG4**" in Column "Note" in the Schedule of Japan, Japan may apply an agricultural safeguard measure only if the aggregate volume of imports of those originating agricultural goods from the European Union for a particular year exceeds the trigger level set out as follows:
    1. a. 2,300 metric tonnes for the first year, except as provided in paragraph 5;
    2. b. 2,456 metric tonnes for the second year;
    3. c. 2,611 metric tonnes for the third year;
    4. d. 2,767 metric tonnes for the fourth year;
    5. e. 2,922 metric tonnes for the fifth year;
    6. f. 3,078 metric tonnes for the sixth year;
    7. g. 3,233 metric tonnes for the seventh year;
    8. h. 3,389 metric tonnes for the eighth year;
    9. i. 3,544 metric tonnes for the ninth year;
    10. j. 3,700 metric tonnes for the 10th year;
    11. k. 3,929 metric tonnes for the 11th year;
    12. l. 4,158 metric tonnes for the 12th year;
    13. m. 4,502 metric tonnes for the 13th year;
    14. n. 4,846 metric tonnes for the 14th year;
    15. o. 5,190 metric tonnes for the 15th year; and
    16. p. from the 16th year, for each year, the trigger level of the previous year plus 458 metric tonnes.
  2. 2. For the originating agricultural goods classified under the tariff lines indicated with "SG4**", the rate of customs duty referred to in subparagraph 3(c) of Sub-Section 1 shall be:
    1. a. 29.8 per cent plus 75 yen per kilogramme from the first year until the fifth year;
    2. b.23.8 per cent plus 45 yen per kilogramme from the sixth year until the 10th year;
    3. c. 13.4 per cent plus 30 yen per kilogramme from the 11th year until the 15th year; and
    4. d. from the 16th year:
      1. i. if an agricultural safeguard measure set out in this Sub-Section was not applied in the previous year, the ad valorem duty component of the rate of customs duty shall be 2.0 per cent lower than it was in the previous year and the specific duty component of the rate of customs duty shall be 4.0 yen per kilogramme lower than it was in the previous year; or
      2. ii. if an agricultural safeguard measure set out in this Sub-Section was applied in the previous year, the ad valorem duty component of the rate of customs duty shall be 1.0 per cent lower than it was in the previous year and the specific duty component of the rate of customs duty shall be 2.0 yen per kilogramme lower than it was in the previous year.
  3. 3. Any agricultural safeguard measure applied under this Sub-Section may be maintained only until the end of the year in which the condition set out in paragraph 1 is satisfied.
  4. 4. If, during any two consecutive years after the 15th year, Japan does not apply an agricultural safeguard measure under this Sub-Section, Japan shall not apply any further agricultural safeguard measures under this Sub-Section.
  5. 5. If the first year is less than 12 months, the applicable trigger level for the first year for the purposes of subparagraph 1(a) shall be determined by multiplying 2,300 metric tonnes by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement and the following 31 March and the denominator of which shall be 12. For the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).
SUB-SECTION 7
Agricultural safeguard measure for fresh oranges
  1. 1. In accordance with paragraph 2 of Sub-Section 1, with respect to the originating agricultural goods classified under the tariff lines indicated with "SG5" in Column "Note" in the Schedule of Japan, Japan may apply an agricultural safeguard measure only if the aggregate volume of imports of those originating agricultural goods from the European Union between 1 December and the following 31 March for the fiscal year exceeds 2,000 metric tonnes, except as provided in paragraph 5.
  2. 2. For the originating agricultural goods classified under the tariff lines indicated with "SG5", the rate of customs duty referred to in subparagraph 3(c) of Sub-Section 1 shall be:
    1. a. 28 per cent from the first year until the fourth year; and
    2. b. 20 per cent from the fifth year until the seventh year.
  3. 3. Any agricultural safeguard measure applied under this Sub-Section may be maintained only until the end of the year in which the condition set out in paragraph 1 is satisfied.
  4. 4. Japan shall not apply any agricultural safeguard measure under this Sub-Section after the end of the seventh year.
  5. 5. If the first year is less than four months, the applicable trigger level set out in paragraph 1 for the first year for the purposes of subparagraph 1(a) shall be determined by multiplying 2,000 metric tonnes by a fraction the numerator of which shall be the number of months between the date of entry into force of the Agreement and the following 31 March and the denominator of which shall be 4. For the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).
SUB-SECTION 8
Agricultural safeguard measure for race horses
  1. 1. In accordance with paragraph 2 of Sub-Section 1, with respect to the originating agricultural goods classified under the tariff lines indicated with "SG6" in Column "Note" in the Schedule of Japan, Japan may apply an agricultural safeguard measure only if the CIF import price per each of those originating agricultural goods, expressed in the Japanese yen, is less than 90 per cent of the trigger price. The trigger price shall be the price that has been agreed in accordance with paragraph 4, or 10.7 million yen if there has been no specific agreement on the trigger price in accordance with paragraph 4.
  2. 2. For the originating agricultural goods classified under the tariff lines indicated with "SG6", the rate of customs duty referred to in subparagraph 3(c) of Sub-Section 1 shall be the rate of customs duty determined for those originating agricultural goods in accordance with category "B15" as set out in subparagraph 1(w) of Section A plus:
    1. a. if the difference between the CIF import price per each of the originating agricultural good and the trigger price is greater than 10 per cent but less than or equal to 40 per cent of the trigger price, 30 per cent of the difference between the most-favoured-nation applied rate of customs duty in effect at the time of importation and the rate of customs duty applied to the originating agricultural goods in accordance with category "B15" as set out in subparagraph 1(w) of Section A;
    2. b. if the difference between the CIF import price per each of the originating agricultural good and the trigger price is greater than 40 per cent but less than or equal to 60 per cent of the trigger price, 50 per cent of the difference between the most-favoured-nation applied rate of customs duty in effect at the time of importation and the rate of customs duty applied to the originating agricultural goods in accordance with category "B15" as set out in subparagraph 1(w) of Section A;
    3. c. if the difference between the CIF import price per each of the originating agricultural good and the trigger price is greater than 60 per cent but less than or equal to 75 per cent of the trigger price, 70 per cent of the difference between the most-favoured-nation applied rate of customs duty in effect at the time of importation and the rate of customs duty applied to the originating agricultural goods in accordance with category "B15" as set out in subparagraph 1(w) of Section A; and
    4. d. if the difference between the CIF import price per each of the originating agricultural good and the trigger price is greater than 75 per cent of the trigger price, the difference between the most-favoured-nation applied rate of customs duty in effect at the time of importation and the rate of customs duty applied to the originating agricultural goods in accordance with category "B15" as set out in subparagraph 1(w) of Section A.
  3. 3. Japan shall not apply any safeguard measure under this Sub-Section after the end of the 15th year.
  4. 4. On request of the European Union, Japan and the European Union shall consult on the operation of the agricultural safeguard measure set out in this Sub-Section and may mutually agree to periodically evaluate and update the trigger price

Japan Rules of Origin

Product specific rules of origin

Description

This page provides an overview of the specific provisions that the EU and Japan have agreed on in their Economic Partnership Agreement (EU-JP EPA).

Rules of Origin

Two annexes to the EU-JP EPA, ANNEX 3-B "Product specific rules of origin" and ANNEX 3-A "Introductory notes to product specific rules of origin", set out the conditions that must be met for a product to be considered originating in the EU or Japan. Furthermore, Appendix 3-B-1 "Provisions related to certain vehicles and parts of vehicles" provides for alternative product specific rules for certain vehicles and parts of vehicles.

Tolerance

In the EU-JP EPA, the general tolerance rule allows manufacturers to use all prohibited non-originating materials as long as their value does not represent more than 10% of the ex-works price or the free on board price of the product.

This tolerance cannot be used to exceed any threshold of maximum non-originating materials listed in the product specific rules when they are expressed in value. However, and this is a particularity in the EU-Japan agreement, this tolerance can be used in cases where the weight of non-originating materials exceeds the threshold in weight foreseen in the product specific rules, provided that the value of those materials does not exceed 10% of the ex-works price of the final good. Beyond this 10 % in value, those materials need to be originating in the EU or in Japan.

The general tolerance rule does not apply to textiles listed in Chapters 50 to 63 (inclusive). Specific tolerance rules for textiles are included in Notes 6 to 8 of Annex 3-A "Introductory notes of product specific rules of origin".

Cumulation

The EU-JP EPA provides for bilateral and full bilateral cumulation.

Bilateral cumulation allows inputs/materials originating in Japan to be considered as originating in the EU when further processed or incorporated in the EU and exported to Japan (and vice and versa). Only materials deemed originating can benefit from this basic type of bilateral cumulation.

Full bilateral cumulation allows the processing/operations carried out in Japan to be counted as qualifying operations in the EU, regardless of whether the processing is sufficient to confer originating status to the materials themselves (and vice and versa).

Duty drawback

Duty drawback is allowed in the EU-JP EPA.

Vessels conditions

The following conditions apply to the vessel or factory ship in order to render the products caught or further processed on board originating (wholly obtained) in the EU or Japan:

The vessel or factory ship must:

  1. a. be registered in a Member State of the European Union or in Japan;
  2. b. fly the flag of a Member State of the European Union or of Japan; and
  3. c. satisfy one of the following requirements:
    1. i.it is at least 50 per cent owned by one or more natural persons of a Party; or
    2. ii.it is owned by one or more juridical persons:
      1. A. which have their head office and their main place of business in a Party; and
      2. B. in which at least 50 per cent of the ownership belongs to natural persons or juridical persons of a Party.

Shipping through a third party: "Non-alteration" rule

A product that is considered originating in the EU or Japan according to the terms of the EU-JP EPA keeps its originating status even if transported via a third country provided the product does not undergo further operations other than unloading, reloading, splitting of consignments or any other operation necessary to preserve it in good condition and remains under customs supervision. Proof of compliance with this "non-alteration" rule may be given by any means, including transport documents, and has to be provided to the customs authorities of the importing party only upon request.

Origin procedures

Proof of origin

Chapter 3, Section B of the EU-JP EPA sets out the origin procedures related to self-certification of origin and verification by customs authorities.

The importers can claim preferential tariff treatment based on the statement on origin provided by the exporter or based on ‘importer’s knowledge´.

The exporters in the EU and in Japan can self-certify that their product is originating by making a statement on origin:

  • This statement shall be made on an invoice or on any commercial document using the wording mentioned in Annex 3-D:
  • It can be made in any official languages of the EU or Japanese. The importing Party may not request a translation.
  • In the EU-JP EPA, the operators need to indicate the origin criteria used in their statement on origin through a code (see in Annex 3-D).
  • A statement on origin remains valid for 12 months.
  • A statement on origin may apply on multiple shipments:  EU-Japan EPA guidance on statement on origin for multiple shipments of identical products further explains how to use it.

In the EU, exporters need to be registered in the REX system. There is no need to be registered when the value of consignments is below EUR 6000.

‘Importer’s knowledge’ allows the importer to claim preferential tariff treatment based on its own knowledge about the originating status of imported products in the form of supporting documents or records provided by the exporter or manufacturer of the product, which are in the importer’s possession. This information provides valid evidence that the product qualifies as originating.

As an importer is making a claim using his own knowledge, no statement on origin is used and no exporter or producer needs to be identified and take any action pertaining to the preferential origin of goods in the exporting Party.

The importer using ‘importer’s knowledge’ does not need to be registered in the REX database.

The EU-Japan EPA guidance on "importer's knowledge" further explains how to use the "importer’s knowledge".

At the moment of claiming preferential tariff treatment, the agreement requires only a reference to the statement on origin or importer’s knowledge in the import declaration. Additional information is required if the claim is selected for verification.

Verification and denial of preference

EU-Japan EPA has introduced some modifications in comparison to the traditional EU verification system.

Verification of origin may be conducted before or after the release of the goods and may lead to a denial of preferential tariff treatment. The Agreement defines which steps customs authorities of the importing country can take to assure that the claim for preferential treatment is correct. They can start verification by requesting the importer for statement on origin and some other information related to origin. Subsequently, they can also ask the customs authorities of the exporting country to conduct verification by contacting the exporter and/or by visiting exporter’s premises. The agreement enlists also specific situations when the preferences can be denied.

Please consult the EU-Japan EPA guidance on claim, verification and denial of preferences for the details. 

Exporters are not required to provide confidential business information either to the importer or the importing Party, and the agreement prevents the exporting customs authority from disclosing such information to the importing Party. The verification procedure foresees that preferential tariff treatment cannot be denied if the importer would not have that information, insofar as he has a statement on origin supporting his claim.

This has been clarified in the EU-Japan EPA guidance on confidentiality of information.

Direct visits by the customs authorities of the importing party to the exporter or direct requests for information to the exporter by the customs authorities of the importing party are not possible as part of the verification process.

SMEs and EU-Japan EPA

The EU-Japan EPA (Economic Partnership Agreement) can make life easier for SMEs (small and medium-sized enterprises) from both sides to export and import.

Almost all tariffs have been eliminated or reduced. Import requirements have been simplified where possible, including customs procedures, rules of origin or technical regulations.

Note: You need to follow the rules of origin that the imports of goods benefit from EPA (EU exporters need to be registered in the REX system)

Information on the EU-Japan EPA

Additional information for SMEs

The EPA includes a specific chapter on SMEs (see Chapter 20 http://trade.ec.europa.eu/doclib/press/index.cfm?id=1684) which includes that the EU and Japan provide information on access to its market:

  • Japanese website for SMEs from the EU (versions in English and Japanese language)
    This website includes links to authorities on agreed trade issues and to an electronically searchable database by customs tariff code on product specific market access information for the import of goods on its market.
  • EU website for SMEs from Japan

Extra support

  • The EU-Japan Centre for Industrial Cooperation is a venture between the European Commission and the Japanese Government. It promotes industrial, trade and investment cooperation exchanging experience and know-how between EU and Japanese businesses. Activities include an EPA Helpdesk. This centre is the Japanese member of the Enterprise Europe Network.
  • The Enterprise Europe Network is the world's largest support network for SMEs. It has 3,000 experts across 600 organisations in more than 60 countries. Members include chambers of commerce and industry, technology centres, and research institutes. The EU-Japan Centre for Industrial Cooperation is the network member in Japan.
  • For EU exporters: The Market Access Database of the European Commission gives EU exporters free on-line information about import conditions in over 130 export markets, including Japan. This is a database searchable by tariff nomenclature code for product specific market access information.
  • For EU importers: The EU Trade Helpdesk is an online database searchable by tariff nomenclature code for product specific market access information on the EU single market.

EPA - Rules of origin

To benefit from Japan-EU Economic Partnership Agreement (EPA ) preferential tariff rates, your product needs to be originating in Japan or the EU. To be deemed originating, your product needs to comply with the provisions of Chapter 3 Section A ("Rules of origin") and the Product Specific Rules (Annexes 3-A, 3-B, Appendix 3-B-1). The Chapter 3 Section A includes provisions allowing more flexibility to comply with these Product Specific rules (tolerance, bilateral full cumulation, absorption rule etc..). Transport via a third country (distribution hubs) is allowed under certain conditions.

Chapter 3 Section B ("Origin procedures") of the EPA sets out the procedures to claim preferential treatment. The EPA is based on the self-certification system, therefore the EU or Japanese exporters self-certify that the product is originating by making a statement on origin in line with Chapter 3, Section A including its Annex 3-D ("Text of the statement on origin"). In the EU, exporters need to be registered in the REX system (Registered Exporter system). There is no need to be registered when the value of consignments is below EUR 6000. Moreover, the EPA gives for the first time a possibility for the importers to claim preferential tariff treatment on the basis of "importer's knowledge", which contributes to facilitation of trade for the related companies.

Statement of origin – see EPA Annex 3-D

EPA and SMEs

The Economic Partnership Agreement (EPA ) between the EU and Japan is in place to strengthen the economic relations between the two economies, a bilateral market of more than 600 million people. Small and medium-sized enterprises (SMEs) on both sides benefit from the Agreement because it facilitates exporting and importing and reduces costs.

SMEs represent 99% of all companies and provide about two thirds of jobs in the private sector and over 50% of economic output (in the EU around 56% and in Japan over 50%). Therefore both parties have agreed on a specific chapter for SMEs in the Economic Partnership Agreement to ensure that more small companies will gain from the benefits of this agreement.

The EPA facilitates SME´s access to information in Japan and in the EU and hence increases their potential to participate in bilateral business activities. The information relates to import duties which have been widely eliminated or reduced. It relates to import requirements for goods, which have been simplified wherever possible on both sides, including customs procedures, rules of origin or technical regulations. In addition, rules are established in areas such as procurement and intellectual property issues. Reduced tariffs together with the simplification of rules and provisions on investment, joint ventures and other business relationships, create business opportunities and eventually help to maintain and create jobs on both sides.

Note: The EU applies its SMEs definition on the EU market and Japan applies its SMEs definition on the Japanese market.

Summary of EPA

The Economic Partnership Agreement (EPA ) has entered into force on 1 February 2019. The negotiations on the trade agreement started in 2013 and were finalised on 8 December 2017, followed by approval procedures in the EU and Japan.

The EPA has eliminated or reduced tariffs and non-tariff measures compared to the situation with no agreement Where needed, transitional periods for tariff reductions were agreed. The EU has liberalised 99% of tariff lines and Japan 97% of tariff lines, and concessions were agreed in terms of tariff rate quotas or tariff reductions on not yet liberalised tariffs. This will save companies of both sides substantial amounts when trading goods on the bilateral market. Wherever possible, import procedures were simplified for a wide range of products. The removal of non-tariff measures in areas such as import procedures or technical regulations has opened new business opportunities. Standards and technical regulations are based on international standards to the greatest possible extent. However, the agreement will not lower safety standards or require parties to change their domestic policy choices on matters such as for example the use of hormones or genetically modified organisms.

The agreement makes it easier for companies of both Parties to provide services and offers greater mobility for company employees to perform their work on the spot. The EPA contains a number of provisions that apply horizontally to all trade in services, such as a provision to reaffirm the Parties’ right to regulate. The right of authorities remains to keep public services public and will not force governments to privatise or deregulate public services, for example in the sectors of healthcare, education and water. Specific commitments were agreed in service sectors, including postal and courier services, telecommunication, maritime transport services or financial services.

The EPA provides companies more access to public procurement contracts and opens new markets for companies of both sides.

The agreement promotes investment between the EU and Japan and reaffirms the right of each party to regulate legitimate policy objectives agreed in a non-exhaustive list. Bilateral negotiations are ongoing for concluding a potential agreement on investment protection.

The commitments on Intellectual Property Rights are reinforced and include provisions on protection of trade secrets, trademarks, copyright protection, patents, minimum common rules for regulatory test data protection for pharmaceuticals, and civil enforcement provisions.

Other relevant issues for SMEs included in the EPA are data protection and safe data transfers and sustainable development which covers amongst other issues, labour and environmental laws and corporate social responsibility.

How EPA benefits SMEs

EPA makes trade easier and lowers bilateral trade related costs. This helps SMEs with their few resources and small trade volumes to overcome the challenges of exporting and importing. So SMEs can become more competitive in bilateral exports and also on the home market, because imported inputs for their production can become cheaper.

New markets…

The EPA makes doing business easier for companies of both Parties on a bilateral market of over 600 million people, which represents almost a third of the global economy.

more easily accessible …

Tariffs for almost all products are eliminated or reduced and trade barriers are removed.

more predictable business environment …

The chapter on Good Regulatory Practices and Regulatory Cooperation commits both Parties to tackle unnecessary trade obstacles. An increased compatibility of regulations and elimination of unnecessary regulatory differences, together with a greater alignment with international standards, promote a predictable regulatory environment and support bilateral trade. Regulatory cooperation is in particular advantageous for SMEs which face high compliance costs when adapting to rules that differ from international standards.

positive effects for bilateral trade and bilateral value chains …

Lower costs of bilateral trade due to eliminated or reduced tariffs and easier trade formalities are encouraging more bilateral trade of raw materials, semi-finished and final products. This will increase bilateral value chains that enhance the competitiveness of companies on the bilateral and international markets.

open trade in services …

The EPA makes it easier for companies of both Parties to provide services and offers greater mobility for company employees.

creating investment opportunities …

The EPA strengthens the bilateral investment climate in each other’s market through better conditions for investors by the principles of non-discrimination and most-favoured-nation treatment. Companies of both sides are treated in the same way as if they were a local company. If in the future other third countries’ investors would have better investment conditions, then the same rules will be applied. In addition, provisions for transferring capital are agreed and certain requirements are abolished such as hiring a specific number of local staff. The bilateral negotiation on investment protection dispute resolution is still ongoing, which aims at a new Investment Court System.

fair market conditions.

The EPA increases competition on both markets. Therefore fair market conditions for all companies must be ensured such as the agreed commitments on competition policy, subsidies and state owned enterprises. A chapter on intellectual property rights strengthens the protection of, amongst others, trade secrets, trademarks and copyright, which safeguards business models and in-house knowledge on product characteristics. Owners of bilaterally agreed "Geographical Indications" in the agricultural, food and beverage sectors benefit from protection against counterfeiting. Data protection and a "mutual adequacy" arrangement facilitate the transfers of data for commercial exchanges with a high protection. The EPA sets principles in several areas to promote sustainable development for avoiding a potential race to the bottom on labour and environmental standards and to ensure competition. A state-to-state dispute settlement mechanism ensures that all commitments under EPA are fully observed.

Specific EPA references to SMEs

SMEs benefit from certain provisions that reinforce the general EPA benefits for SMEs:

  • Preamble: SMEs are mentioned in the context of strengthening economic, trade and investment relations, where the needs of the business communities of each Party should be considered.
  • Customs matters and trade facilitation (Chapter 4, Article 4.6): Both Parties committed to simplify their requirements and formalities for customs procedures to reduce the time and costs for traders or operators, including SMEs.
  • Electronic commerce (Chapter 8, Section F, Article 8.80): The Parties agreed a cooperation with regard to a dialogue on regulatory matters that includes sharing information on challenges for SMEs in the use of electronic commerce.
  • Intellectual property rights (Chapter 14, Section D, Article 14.52): One of the cooperation provisions to further promote trade and investment between the parties may cover areas such as intellectual property issues relevant to SMEs.
  • Transparency – transparent regulatory environment (Chapter 17, Article 17.2): SMEs are mentioned as operators for which a transparent, effective and predictable regulatory environment should be provided.
  • Good regulatory practices (Chapter 18, Section A, Sub section 2, Article 18.8): The EPA foresees carrying out, in accordance with the relevant rules and procedures, an impact assessment of major regulatory measures under preparation. Considered would be also to the extent possible and relevant, the potential social, economic and environmental impact, including on SMEs.
  • Small and medium sized enterprises (Chapter 20, Articles 20.1 to 20.4)
    Objective (Article 20.1) - The SME Chapter includes in the objective that the Parties recognise the importance of the provisions of the SME Chapter and other provisions in EPA that seek to enhance cooperation on matters of relevance to SMEs.
    Information sharing (Article 20.2) - The Parties provide a publicly accessible website with an agreed content of information. This website includes links to authorities on agreed trade related issues and to an electronically searchable database by customs tariff code which provides product specific market access information for the import of goods on its market.
    SME Contact Points (Article 20.3) - The Parties designate an "SME Contact Point" on each side. They work together to ensure that the EPA benefits SMEs.
    No dispute settlement is foreseen for this SME Chapter (Article 20.4).