Country of Origin Determination
The origin of a product plays a significant role when you think of importing and exporting your goods, as the origin is one of the tax bases. Our experts help you determine your country of origin and support you with:
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What is the Country Origin?
Let’s look at an example. A car manufactured in Japan has been imported to Germany and sold by a German car dealer to a customer in the Netherlands. While the Dutch customer could say he bought a German car, the car was still manufactured in Japan. From a customs point of view, the country where it was manufactured can change if the product is processed (changed) before it is sold. Let’s say the German company that imported the car takes out the gas engine and installs an electrical drive train, making it an electric vehicle. The country of origin is now Germany.
An important aspect of origin is the difference between preferential- and non-preferential origin.
If you’re a product has a preferential status, it might be possible to import the product against lower or even no import duties.
The non-preferential origin doesn’t have any impact on the number of import duties but is important in certain cases, for example, if anti-dumping rates are applicable.
If certain components were bought and re-sold several times proof of origin can be required from all these steps. Proving preferential origin always includes valid background paperwork in the exporters’ administration.
Know the rules, know your product, ask a consultant
Did you also know that a lot of documentation is involved to prove the origin? If certain components were bought and re-sold several times documents are required from all these steps. If components were processed in one of these steps it gets even more complicated. Proving preferential origin always requires valid background paperwork in the exporters’ administration. Proving preferential origin always requires valid background paperwork in the exporters’ administration.
Customs Support has experienced people to look at your specific situation, analyse the goods flow and determine whether a product meets the rules of origin.
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Country of Origin Determination | Frequently Asked Questions (FAQs)
How does origin impact importers and exporters?
Origin helps the importer know where a product comes from. Country of origin determines duty rates, preferential trade agreements, trade sanctions and import quotas. So ensuring accurate country of origin is essential for both importers as well as exporters.
What documents can be used as proof of origin?
For both preferential and non-preferential origin proof of origin is required. For preferential origin, this can be a EUR1 certificate, an invoice, a declaration, or a statement of origin. Claiming a lower import duty rate is only possible if the product meets the origin criteria. The specific product requirements, processing, and proof of origin must be provided. This is all laid down in the Trade Agreements that the EU has concluded with the countries or areas.
What are the challenges of determining origin?
Determining the origin when the products come from a single source with only a few components is relatively easy. But, when there are many components from many origins, it gets complicated, as origin requirements vary country-to-country.
Why do you need a specialist to determine origin?
In order to define the right country of origin of your product, the knowledge of a specialist might be needed. Country of Origin can be rather complex due to the specific regulations per product and per country of destination and the Free Trade Agreement. Given the duty benefits on many products having a preferential status, it is very important to know the rules and the product you would like to im- or export.