The Japanese economy offers a diverse marketplace where Australian exporters can explore a variety of opportunities. Japanese importers value high-quality products and services, relying on Australia for goods including food, energy and minerals (such as coal, LNG and iron ore). Whilst the impact of COVID-19 has had a significant impact on the shipping industry and economy, Japan has shown a strong resilience and potential to recover.
Below, we’ll cover all the basics – how you export to Japan, the benefits of exporting there, Australia’s free trade agreement with Japan and more.
Overview: Exporting to Japan
The first thing to know about exporting to Japan has nothing to do with exporting at all – it’s about doing business in Japan generally.
The Japanese people have a very particular way of ‘doing business’, placing a strong emphasis on etiquette and punctuality. You’ll want to make sure to stay humble when communicating with them, and generally arrive at least 10 minutes before a meeting is scheduled to start.
Understand that because the Japanese way of doing business is very polite, their communication in meetings may come across as indirect. Don’t misinterpret this as a sign that they don’t want to work with you. Austrade actually suggest going out for dinner and drinks with them, as it’s “often the time when more useful information is fed back to you”.
The Export Market
Japanese consumers tend to have large amounts of disposable income, with companies eager to invest in sustainable long-term goods and services.
Japan is Australia’s second largest trading partner, with Australia exporting around AUD$59.1 billion in the 2018-19 financial year (accounting for around 15.8 per cent of Australia’s total exports of goods). Many of these exports included natural gas, coal, iron ore beef and aluminium.
Australia has enjoyed a great deal of bilateral trade with Japan since the end of the Second World War and the signing of the 1957 Commerce Agreement.
In 2015, the two countries signed the Japan–Australia Economic Partnership Agreement (JAEPA). This Agreement has now given exporters in Australia largely improved market access into Japan as well as their investment protection. Most significantly, the Agreement granted entry into the highly protected Japanese agricultural market, presenting considerable opportunities for exporters. You can read more about the benefits for free trade in our free trade agreements article.
When exporting across the world, time is everything. You’ll need to understand typical shipping timeframes between Australia and Japan, and make the choice between sea freight or air freight (the advantages of each you can read about on our Air Freight Versus Sea Freight article).
Sea freight to and from the major Japanese ports (Tokyo, Nagoya and Osaka) to Australia will differ, but a shipment can take:
- as little as 18 days to / from Sydney; and
- as little as 22 days to / from Fremantle.
Air freight, on the other hand, can take less than 24 hours!
Benefits of working with Japan
There are a range of benefits of working with Japan, including the free trade agreement we discussed above and the JAEPA Certificate of Origin. Both of these documents present significant market advantages for Australian exporters, which we’ll consider below.
Japan–Australia Economic Partnership Agreement
JAEPA came into effect on 15 January 2015, completely removing or significantly reducing barriers to trade between Australian and Japan. Some of the important benefits include reducing tariffs on beef, removing the 15 per cent tariff on bottled wine over seven years, providing duty-free quotas for Australian cheese and gradually eliminating the tariff on many of our fruit and vegetables.
JAEPA Certificate of Origin
You can use the JAEPA Certificate of Origin (or any valid Certificate of Origin under the Agreement) to access the reduced tariff and duty rates on certain goods. A separate certificate will be required for each shipment you make if you are seeking to claim reduced duty rates.
To enjoy this benefit, your goods will need to be eligible. Failure to comply with the preferential rules of origin (ROOs) will lead to the general tariff or duty being applied to your shipment. The criteria to satisfy includes the following:
- Your goods must be wholly obtained or produced entirely in Australia (or both Australia and Japan);
- Your goods must be produced entirely in Australia (or both Australia and Japan) from ‘originating’ materials; or
- Your goods must be produced in Australia (or both Australia and Japan) using components from other countries but meets the relevant Product Specific Rule (PSR).
You can read more about making a claim for preference under JAEPA using a Certificate of Origin on the Australian Border Force’s website.
Documentation requirements for exports to Japan
Just as is the case with exporting to any country, Japan’s customs authorities have their own documentation requirements for the import of goods. Which precise documentation you’ll need will depend on the particular goods you’re exporting, but generally, you’ll need to consider:
- Import licences – you may need these if you’re exporting certain goods such as hazardous goods, plants, animals and perishables.
- Customs Form C-5020 – Japan’s general import declaration form, will need to be prepared and submitted to customs authorities.
- Certificate of origin – This document declares the country in which your goods were manufactured. As discussed above, you can use the JAEPA Certificate of Origin to reduce or completely remove tariff or duty rates on eligible goods you’re exporting to Japan.
- Bill of lading– This acts as the contract of carriage between the Shipper, Consignee, and Carrier stating the terms and conditions of carriage.
- Commercial invoice– another critical document outlining who is buying what from whom, and the terms agreed between both importer and exporter.
- Packing list – this list will further outline the detail of your goods, including how the shipment is packed.
For further information, you can read our blog on the 5 shipping documents you’ll generally need for imports or exports. It’s important to get these documents right to avoid delays and extra costs throughout the shipping process.
Export to Japan using an expert freight forwarder
The export process can be complicated, with lots of documentation you’ll need to handle and different regulations to consider. We suggest that the best way to go forward is to engage an expert freight forwarder who deals in the world of international trade on a day-to-day basis.
Our expert freight consultants at International Cargo Express, along with our exclusive Japanese contact at Hankyu Hanshin, can help you navigate your export each step of the way. Some of the benefits of working with us include:
- Experience – We’ve been delivering expert freight solutions, supported by experienced staff for over 30 years. We know and understand the Japanese market, and have helped many Australian exporters achieve a huge range of benefits that Japan has to offer;
- Customisation – We don’t adopt a cookie cutter approach. We understand that your business and freight requirements are unique and that one solution does not fit all;
- Your business is the focus – Choosing our partnership means you’ll benefit from decades of knowledge and experience and a customer service team that puts your business first; and
- Coverage – From Sydney to Tokyo, Perth to Osaka, we can offer air and sea freight services that deliver across Australia and Japan. Our seamlessly integrated start-to-finish service has come to be depended on by many businesses across Australia.
We’re more than happy to have a confidential, obligation-free discussion with you and understand what you’re trying to achieve today.
or call us on 1300 227 461