Preferential origin is conferred on goods from particular countries, which have fulfilled certain criteria allowing preferential rates of duty to be claimed.
Preferential origin is conferred on goods from particular countries, which have fulfilled certain criteria. In order to obtain preferential origin those criteria generally require that the goods be wholly obtained or have undergone specifically determined working or processing.
Preferential origin confers certain tariff benefits (entry at a reduced or zero rate of duty) on goods traded between countries which have agreed such an arrangement or where one side has granted it autonomously.
In order to have preferential origin goods must fulfil the relevant conditions laid down in the origin protocol to the agreement of whichever country is concerned or in the origin rules of the autonomous arrangements.
In effect it means that goods must either (1) be manufactured from raw materials or components which have been grown or produced in the beneficiary country or, should that not be the case, (2) at least undergo a certain amount of working or processing in the beneficiary country. Such goods are considered to be "originating".
In all cases there is a list of the working or processing each product manufactured from non-originating materials or components must undergo in order to obtain originating status. These rules are often referred to as "the list rules". They set out the least amount of working or processing required on non-originating materials in order for the resulting goods to obtain originating status. Further working or processing going beyond that is acceptable and will not affect the origin thus obtained.
The structure of the list of working or processing requirements is based on the structure of the HS. So before being able to determine what processing a specific product must undergo it is necessary to know its HS classification. More detailed information on tariff classification is available under tariff aspects.