The origin of a product is one of the base elements to determine the amount of customs duties due. Thus one of the steps is to determine the origin. When does a product get the origin of a country? Depending on the country of origin or the product’s destination, specific and complex regulations apply. We would like to help you to find your way through all the rules and to determine the correct origin.

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Origin and provenance

The words ‘provenance’ and ‘origin’ of goods are often used interchangeably in the English language. Although, the two words have different meanings for customs matters.  The ‘provenance’ of goods relate to the customs status of the goods. Can the goods be qualified as Union goods (goods that are produced in the EU, or that have already been imported from a non-EU country) or non-Union goods (goods from non-EU countries)? The ‘origin’ of a product refers to where a product was initially manufactured, produced or grown.

The origin of goods is relevant for various measures. A low customs duty – or rate – is familiar to almost everyone. For example, goods from Bangladesh are taxed with a lower customs duty than goods from China. Besides the list of countries with more favourable import rates, other scenarios exist which lead to lower or zero import duty rate. Consider trade policy measures such as anti-dumping duties, import restrictions or measures under the Common Agricultural Policy. Furthermore, political measures can play a role, for example in case of a trade boycott.

Preferential and non-preferential origin

When determining the origin of a product, a distinction needs to be made between preferential and non-preferential rules of origin. The preferential rules of origin determine whether goods fall within the scope of free trade agreements, which could lead to lower or zero customs duties or unilateral preferential measures.

In almost all cases, the preferential origin criteria are more strict than the non-preferential. That is, when a product that is originating in the sense of a preferential arrangement normally so in the sense of a non-preferential arrangement. Conversely, the non-preferential origin of a product is no guarantee of its origin in the preferential sense.

Certificate of origin

A certificate of preferential origin proofs that the goods met the conditions and subsequently allows to benefit from reduced or zero customs duties rates on importation. In order to establish that a lower customs rate can be granted, the declarant must provide proof in the form of a certificate of origin. A proof of origin is issued only when the goods in question meet the established origin criteria. However, origin is a sub-area of customs law where quite a lot can go wrong. In many cases certificates are issued incorrectly with all the possible (financial) consequences such as additional assessments on customs duties and/or fines.

Our experts are happy to advise you.