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Mandatory Origin marking is prevalent in food products and mostly voluntary for everything else, but is gaining more exposure in EU and other jurisdictions. Identifying the correct country of origin for your products can also make the difference between qualifying for preferential rates under free trade agreements or fines within your supply chain. The consequences of making an incorrect assumption that you qualify under certain rules of origin can be substantial.
When calculating the Country of Origin, several different Origin Models can be applied. Where Substantial Transformation is needing to be evaluated, the Compliance Map system will automatically review tariff changes based on BOM and supply chain information and mark products appropriately.
As a criteria that expresses “Substantial Transformation”, Regional Value Content rules can be applied (such as with ASEAN origin legislation). Non-originating and originating materials are aggregated based on origin data and rolled-up to determine whether the test passes a Value Content threshold (such as 40%).
Rules of Origin are used to determine the nationality of a given product. There are legal consequences to making an incorrect origin determination and marking your products. This can result in fines and other penalties.
The rise of globalisation, supply chain complexities, multi-sourcing and production of goods in multiple stages can make tracking down the origin of items and raw materials tricky. Components used in assembly can be sourced from around the world and often you may need to trace this information several tiers down your supply chain and also factor in assembly and manufacturing locations.