Jump to:
- Overview
- No more tariffs
- More flexible rules of origin
- Easier trading environment
- New Zealand product regulations and import conditions
- Additional information for selling goods in New Zealand
- Case study: Exporting a portable horticultural sprayer to New Zealand
Overview
The UK-New Zealand Free Trade Agreement (FTA) will see manufacturers benefit from tariff-free exports, flexible rules of origin, and simple customs procedures when exporting.
The UK has a world-renowned industrial heritage and around 240,000 manufacturing businesses, many with globally recognised capabilities in automation, energy, and technology.
There is strong demand and growth potential in the New Zealand agricultural technology (agritech) sector due to the country’s traditional strengths in agriculture and innovation. New Zealand companies are increasingly seeking expertise across the agricultural value chain.
This means that there are significant opportunities for UK companies in robotics and automation, Internet of Things, precision farming, animal genetics, aquaculture as well as farm equipment and technology.
The New Zealand Government has committed funding to reduce agricultural emissions, increase productivity, boost biosecurity, and provide vital support to farmers and growers. This funding will be focused on technologies, services and tools that help farmers boost productivity and reduce on-farm emissions. The UK excels in these areas and stands to benefit from these opportunities.
The UK and New Zealand face challenges with comparable agricultural sectors. Both share a similar maritime climate, comparable terrain, and farming sectors. Being the opposite side of the world allows for two seasons in 12 months - ideal for agritech development and testing.
The FTA will allow UK goods manufacturers to benefit from cheaper access to imported machinery parts, zero tariffs on final exported products, as well as digital measures supportive of future technologies.
Liberal provisions around services, trade and free flows of data will make it easier and safer for UK based manufacturers to remotely inspect machinery in New Zealand whilst monitoring internal data for performance, efficiency, and research.
No more tariffs
| Tariff heading | Previous tariff | New tariff |
|---|---|---|
| Horticultural sprayer | Up to 5% | 0% |
| Aeroponic irrigation system | Up to 5% | 0% |
| Depuration equipment (aquaculture) | Up to 5% | 0% |
| Harvesting machinery | Up to 5% | 0% |
The reductions are conditional on goods having originating status.
More flexible rules of origin
The new rules of origin (RoO) have been designed to support the UK manufacturing sector who are heavily reliant on imports, to lessen the cost of importing components from New Zealand and exporting final products to New Zealand.
Most UK manufacturers should be able to qualify for tariff-free trade whilst maintaining their existing supply chains. They will be able to import parts into the UK and still qualify for 0% tariffs when exporting the finished products to New Zealand, provided they comply with the rules of origin outlined in the FTA.
Example
Use the UK's Trade Tariff tool to first identify the Harmonised System (HS) code of your good. Consult the Product Specific Rules of the FTA document and look up the rule for your good.
For the purposes of these rules, HS codes are defined at the 2-, 4- and 6-digit level.
Harmonised System (HS) code: 842441
Product: Agricultural or horticultural sprayers
This rule can be fulfilled either through a Regional Value Content (RVC) of 40% or Change in Tariff Subheading (CTSH).
Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) full cumulation
The CPTPP agreement allows for full cumulation. This means processing undertaken in CPTPP parties can be counted towards achieving the origin threshold. Traders will have greater choice on where to source inputs for their goods and improves UK businesses’ integration into regional supply chains.
You can refer to the CPTPP origin reference document for more information.
Regional value content (RVC)
RVC can be calculated via either the build-down method (using value of non-originating materials) or the build-up method (using value of originating materials).
For example, a UK trader produces Product A using a variety of originating and non-originating materials, with the intention of exporting the product to New Zealand.
To meet originating status, Product A must meet a Product Specific Rule of RVC40. To calculate Product A’s RVC, the trader would need to determine the total value of the good they are producing based on the costs as determined within the Rules of Origin Chapter of the FTA.
Build-down method (non-originating materials)
- Use RoO chapter text to calculate value of ‘nonoriginating materials’ in product A, and the value of Product A (‘value of the good’)
- Subtract the value of the ‘non-originating materials’ from the value of the good itself
- Divide by the value of the good and multiply by 100 for the RVC %
- If the final figure is 40 and above, then product A qualifies as originating and can access preferential tariff rates when exported to New Zealand
Build-up method (originating materials)
- Use RoO chapter text to calculate the value of the ‘originating materials’ used in product A, and the value of Product A (‘value of the good’)
- Divide the value of the ‘originating materials’ by the value of the good and multiply by 100 for the RVC %
- If the final figure is 40 and above, then product A qualifies as originating and can access preferential tariff rates when exported to New Zealand
Please find more information on RVC rules in the guidance on using rules of origin in the FTA.
CTSH
This rule can be fulfilled if all non-originating materials used in the production of the good have undergone sufficient processing to change any of the six digits (or “Tariff Subheading”) of their HS code.
Please find more information on CTSH rules in the guidance on using rules of origin in the FTA.
Easier trading environment
New customs commitments and minimised paperwork will ensure machines and parts exit customs quickly, provided all requirements have been met, giving businesses the certainty they need to ship products to and from New Zealand.
Enhanced mobility provisions will allow businesses to provide after sales services with increased access. UK businesses trading or investing in New Zealand will benefit from clarity, stability and certainty regarding the New Zealand regulatory framework and policy making.
Regulatory obstacles to trade will be easier to address and avoid through closer relationships between UK and New Zealand regulatory authorities, which is important to sectors operating in future technologies.
Trade in innovative technologies is further supported through the intellectual property chapter, including provisions on copyright and related rights, designs, patents, etc.
The environment chapter strengthens cooperation on areas such as sustainable agriculture and the transition to a circular economy, which underpinned by each country’s global leadership on environment and climate change, will lead to increased opportunities for businesses whose products support wider environmental goals.
Increased access to government procurement will allow UK exporters to use their competitive advantage over other countries to access a large number of covered New Zealand government bodies including central government departments, listed sub-central government entities and other linked organisations.
New Zealand product regulations and import conditions
Information on regulations that apply to your industry can be found on the New Zealand Ministry of Business, Innovation and Employment product standards website.
For used machinery, please ensure you adhere to biosecurity import requirements.
Additional information for selling goods in New Zealand
Selling goods in New Zealand will require following certain rules and regulations according to the agreements you have in place with your buyer.
Further information on incoterms and import conditions can be found online. The New Zealand Customs Service regulates all goods imported into New Zealand. You’ll need to provide import declarations and documents and pay all relevant duties and taxes.
Goods and Services Tax (GST) is a tax on most goods and services in New Zealand. The current GST rate is 15%. Learn more about GST on the New Zealand government website.
Case study: Exporting a portable horticultural sprayer to New Zealand
Please note that this case study is illustrative only and should not be relied on as a substitute for your own research.
Exporters should check on the most up to date rules and processes with the relevant customs authority.
To clear UK customs, UK exporters (or whoever is handling customs procedures on their behalf) will need to ensure the following steps are met:
1. Agree incoterms and terms of payment
UK exporters should agree incoterms and terms of payment with importers of New Zealand.
"We agreed on Shipping DAP to the New Zealand importer. This means we will be responsible for all costs and risks associated with the delivery to the final agreed place."
2. Determine the HS code(s)
Determine the HS code(s) of your goods using the UK's Trade Tariff tool.
"We determined the HS code, in this case, of HS 84244100".
3. Check if the goods are restricted
Check whether your good is restricted/needs a licence.
"In this case, no licence is needed for new agricultural machinery".
4. Gather commercial documents
Gather commercial documents and submit to the transporter:
- commercial invoice (content of goods and demand for payment)
- packing list (weight, packaging and carton numbers of goods)
- RoO documents (see above)
"In this case; 1 x new sprayer, value 1960 NZD (exchange calculated on 06/03/2023). This product meets the RVC40 requirement and therefore qualifies for originating status and 0% import tariff into New Zealand".
The UK exporter can provide an origin declaration for the New Zealand importer, or the importer can make a claim for preferential tariff treatment based on Importer’s Knowledge.
The New Zealand importer can use Importer’s Knowledge on the basis of either having documentation demonstrating that the good is originating, or being able to reasonably rely on supporting documentation provided by the UK exporter or UK producer that the good is originating.
The importer must be able to provide such documentation to New Zealand’s customs authorities upon request.
5. Gather shipping documents
Gather shipping documents (done by the transporter).
"In this case, the bill of landing, as the good is sent by sea".
6. Declare
Make an export declaration through Customs Declaration Services.
7. Check
Check if you need to submit an Exit Summary Declaration.
"In this case, safety and security requirements are met and there is no need to submit an Exit Summary Declaration".
To clear New Zealand customs, importers will need to:
- Submit an Impending Arrival Report at (air)port of entry.
- Submit an Actual Arrival Report at the (air)port of entry.
- Submit a Customs Import Declaration (if the goods are worth more than $1,000 NZD) or a Self-Assessed Clearance Declaration (otherwise).
For further information on exporting from the UK, use the Check duties and customs procedures for exporting goods tool.
For further information on importing into NZ, use the New Zealand customs service.
For further information on agritech trends in New Zealand, the latest Agritech NZ report might be of use.
The UK and New Zealand share a common language and culture, as well as business and legal practices such as intellectual property (IP) protection and the rule of law. These similarities make New Zealand a relatively easy place for British companies to do business.
New Zealand is a highly educated, wealthy and tech-savvy market where around 42% of the population live in New Zealand’s 3 major cities of Auckland, Wellington and Christchurch making it easy to prioritise where to test and launch your product or service.
New Zealand is also a logical onward step for UK companies to test the market when already doing business in Australia.
Legal disclaimer
The information provided on this webpage is for guidance only and should not be relied on as a substitute for your own research or independent advice.
No investment and/or business decision should be made solely on the basis of information presented on this page. It is recommended that an independent due diligence investigation is conducted before entering into engagement with any individual, firm, company or other organisation mentioned.
DBT accepts no responsibility for any loss or damage caused to any person as result of any error, omission, inaccurate or misleading statement on this page.
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