Practical tips
1. Start with the basics
The first critical question is why the origin is being determined. Does it concern preferential or non-preferential origin? For example, are you trying to determine if a table from Mexico qualifies for a reduced customs duty (preferential origin)? Or do you need to establish the origin of an energy-saving lamp because an anti-dumping duty applies if it originates from China (non-preferential origin)?
Next, you need to determine which agreement or legislation applies. Some countries have bilateral agreements, while others fall under the Generalized System of Preferences (GSP). This step is vital.
2. Establish the origin criteria
Once the applicable rules are identified, the specific criteria must also be determined. For example, adding a certain value might suffice, but in some cases, highly specific conditions apply.
In summary, there are many rules, but even more exceptions. For instance, after establishing origin based on substantial transformation, tariff classification changes, or specific processing, you must also verify that the processing does not qualify as insufficient.
If authorities believe that certain processes are solely intended to circumvent legal provisions, these may be classified as minimal processing, and the origin cannot be granted.
3. Seek origin-conferring processing!
Despite the stringent criteria, there are opportunities to achieve the desired origin. Many origin regimes include “positive” exceptions. For instance, the value tolerance rule often applies, allowing origin to be granted if the value of non-originating materials is less than 10% of the ex-works price. Positive exceptions also frequently exist for accessories, spare parts, tools, sets or assortments, and neutral elements (e.g., fuel).
Another positive exception is cumulation. Cumulation allows for the inclusion of processing activities in other countries when determining the origin of goods. Particularly under the Pan-European agreements, this can have significant benefits.
4. Request a second opinion
Determining the correct origin and applying origin criteria accurately is no simple task. It is not uncommon for customs authorities to disagree with the importer or exporter. In some cases, even the authorities themselves may not agree. Therefore, it can be valuable to have the process critically reviewed to ensure the origin is determined correctly. Our experts are happy to provide this advice.
5. Apply for a Binding Origin Information (BOI)
For complete certainty, you can apply for Binding Origin Information (BOI) from Customs. A BOI is a written, binding decision on the origin of a product. Based on the facts, it determines which origin criteria apply and whether those criteria have been met. A BOI is valid throughout the European Union for three years from the date of issuance. We can also assist you with the BOI application process. Note: A BOI cannot be used to prove the origin when making a declaration. The applicable origin documents, such as a EUR.1 certificate, are required for this purpose.