Certificate of origin
Topic: International Trade Policy, WTO and Intellectual Property · NCERT: Beyond NCERT
Meaning
A certificate of origin is the document an importer shows to prove where goods come from. Under a free trade agreement (FTA), only goods from a partner country get lower tariffs. So the certificate must show the goods meet that FTA's rules of origin, the tests that decide a product's "nationality". These tests include being wholly obtained in the country, a change in tariff heading, or a minimum share of local value added. The certificate stops trade deflection, which is routing third-country goods through an FTA partner to dodge duties.
Example
Indian customs suspected that Chinese goods were being routed through ASEAN partners with certificates claiming ASEAN origin. So CAROTAR 2020, in force from 21 September 2020, made the importer responsible for proving that the claimed origin is genuine, and not just for showing the certificate.
Don't confuse with
- Rules of origin: these are the tests that decide origin. The certificate of origin is the document that proves the goods pass them.
Related concepts
- Stages of economic integration
- Preferential trade agreement
- Free trade agreement
- Customs union
- Common market
- Economic union
- Monetary union
- Trading bloc
- Regional economic groupings
- Regionalism