How to Correctly Determine the Origin of Goods — A Complete Guide

Let's start with a definition — what is the origin of goods?

The origin of goods is what establishes the link between a product and the country it is deemed to originate from. It indicates a product's economic connection to a specific country or region.

The origin of goods differs from a "Made in…" mark, the country of purchase, or the product's customs status. The process of determining the origin of goods is often complex and requires an in-depth knowledge of both the product and the rules governing the matter. Correctly establishing origin is crucial not only for setting duty rates, but also for applying international trade restrictions such as sanctions. It matters for ensuring trade operations comply with international rules and regulations.

The first key question we need to ask is: "Are we dealing with 'wholly obtained' goods?"

Wholly obtained goods include:

- Mineral products extracted from the soil or the seabed

- Plant products harvested in the area concerned

- Live animals born and raised in the area concerned

- Products obtained from live animals raised in the area concerned

- Products obtained by hunting or fishing in the area concerned (this applies to inland waters and territorial seas)

- Products of sea fishing and other products taken from the sea outside territorial waters by "their" vessels

- Products made on board "their" factory ships exclusively from the products listed above

- Used articles collected in the area concerned, fit only for the recovery of raw materials, including used tyres fit only for retreading or for use as waste

- Waste and scrap resulting from manufacturing operations carried out in the area concerned

- Products extracted from the seabed or subsoil beneath the seabed outside territorial waters, provided the country has exclusive rights to exploit that area

- Goods produced in the area concerned exclusively from products listed above

If our goods can be considered wholly obtained, the matter is simple — we are dealing with originating goods. Unfortunately, such cases are rare. Our products are often the result of processing raw materials or components sourced from different countries. In such cases, determining origin becomes more complex, requiring an analysis of the manufacturing process, the value added, and compliance with specific criteria set out in customs regulations. For such goods, it is essential to establish the degree of processing and the origin of the materials used, so as to clearly determine the country of origin.

Insufficient working or processing

If our goods are not wholly obtained, we need to ask ourselves another key question: was the working or processing sufficient for the product to acquire originating status? To determine this, it's always worth starting by checking whether our processing operation falls within the list of processes considered insufficient working or processing, such as:

- Operations to ensure the preservation of products in good condition during transport and storage

- Breaking-up and assembly of packages

- Washing, cleaning, removal of dust, oxide, oil, paint or other coverings

- Ironing or pressing of textiles

- Simple painting and polishing operations

- Husking, partial or total bleaching, polishing and glazing of cereals or rice

- Operations to colour sugar or form sugar lumps

- Peeling, stoning or shelling of fruit, nuts and vegetables

- Sharpening, simple grinding or simple cutting

- Sifting, screening, sorting, classifying, grading, matching (including the making-up of sets of articles)

- Simple placing in bottles, cans, flasks, bags, cases, boxes, fixing on cards or boards and all other simple packaging operations

- Affixing or printing marks, labels, logos and other like distinguishing signs on products or their packaging

- Simple mixing of products, even of different kinds

- Simple assembly of parts of articles to constitute a complete article, or disassembly of a product into parts

- Slaughter of animals

If our process falls within this list, it does not change the origin of the goods. However, if the goods have undergone a substantial and economically justified process of working or processing in an undertaking equipped for that purpose, resulting in the manufacture of a new product or representing an important stage of manufacture, it can be considered that we are probably dealing with originating goods.

Another important question we need to ask is: "For what purpose are we determining the origin of the goods?"

Origin of goods — types of origin

Customs rules distinguish two types of origin:

Preferential origin: This type of origin entitles the holder to benefit from tariff preferences resulting from trade agreements or other international arrangements. Products with preferential origin may be subject to reduced duty rates or fully exempt from duty.

Non-preferential origin: This type of origin does not give any right to tariff preferences. It is nevertheless important for purposes such as customs controls, labelling, sanctions and import quotas. You can find out more on this topic in our article "Preferential and non-preferential origin of goods".

To sum up…

Why is correctly determining the origin of goods so important?

Establishing the correct origin of goods is a process that requires in-depth knowledge. Without properly determining origin, businesses may face various difficulties, such as:

- Non-compliance with customs rules: Every country has its own regulations on the origin of goods, which can affect duty rates, border controls, or even the ability to import or export. Incorrectly determining origin can lead to breaches and the resulting legal consequences.

- Financial losses: The origin of goods has a direct impact on duty rates. If origin is not correctly established, businesses may end up paying higher customs charges or fail to benefit from relief they would otherwise be entitled to.

- Delivery delays: Improperly documenting the origin of goods can result in delays during customs clearance, disrupting the supply chain and potentially affecting relationships with customers.

- Risk of sanctions

If goods originate from countries subject to sanctions or trade restrictions, a failure to correctly establish origin can expose businesses to serious consequences, including financial penalties and trade restrictions.

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