Non-preferential origin of goods and rules of origin
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- Topic: origin of goods
What is the definition of origin of goods?
There is no international definition of origin of goods, although a distinction is made between two systems: preferential and non-preferential. In the case of preferential origin, everything is based mainly on bilateral or multilateral agreements. In the case of non-preferential origin, each country applies its own rules, although within some regional economic unions the non-preferential rules are harmonised for all the member states of the Union concerned.
The World Customs Organization (WCO), in the International Convention on the simplification and harmonization of Customs procedures (Revised Kyoto Convention), defines rules of origin as 'the specific provisions, developed from principles established by national legislation or international agreements ('origin criteria'), applied by a country to determine the origin of goods.
What is the purpose of rules of non-preferential origin?
The country of origin must not be confused with the country of provenance (i.e., the last country that the goods passed through). The purpose of rules of origin is to determine the 'economic nationality' of a good. The determination of the country of origin is, alongside tariff classification and customs valuation, an essential factor for establishing the amount of the customs duties and taxes payable. The origin of a good will also determine, where appropriate, the application of any trade policy measures (quotas, anti-dumping duties, trade embargoes, etc.).
- Market: Global