A BRIEF INTRODUCTION TO

PART I: BACKGROUND
RULES OF ORIGIN

• World Trade Organization (WTO) defines

Rules of origin (ROO) as ”the criteria
needed to determine the national source of
a product”.

• WTO Agreement on Rules of Origin

distinguishes between two types of Rules of
Origin - Non-Preferential Rules of Origin
and Preferential Rules of Origin.
Background (1)
• In 1995 the World Trade Organization (WTO) was established via
the so-called Marrakesh Agreement (MA). One of the annexes to
the MA is the WTO Agreement on Rules of Origin (AROO).

• The AROO aims at harmonizing the non-preferential rules of

origin, outlines general principles for the making of rules of origin
and established two commitees, i.e. the Committee on Rules of
Origin (CRO) and the Technical Committee on Rules of Origin
(TCRO).
Background (2)
• The Committee on Rules of Origin within the framework of the
WTO, open to all WTO Members. It is to meet at least once a year
and is to review the implementation and operation of the
Agreements (Article 4:1).
• The Technical Committee on Rules of Origin (TCRO)’s main
functions are (a) to carry out the harmonization work; and (b) to
deal with any matter concerning technical problems related to
rules of origin. It is to meet at least once a year. Membership is
open to all WTO Members; other WCO members and the WTO
Secretariat may attend as observers (Article 4:2 and Annex I).
Understanding Rules of Origin (1)
• There may be several ways to define rules of origin. The International
Convention on the Simplification and Harmonization of Customs Procedures
(so-called Kyoto Convention which entered into force in 1974) defines rules of
origin as follows:
Ø “The specific provisions, developed from principles established by national legislation
or international agreements applied by a country to determine the origin of goods.”
• The Annex of the Marrakesh Agreement defines:
Ø “Non-Preferential Rules of Origin shall be defined as those laws, regulations and
administrative determinations of general application applied by any Member to
determine the country of origin of goods” (Article 1.1).
Ø “Preferential Rules of Origin shall be defined as those laws, regulations and
administrative determinations of general application applied by any Member to
determine whether goods qualify for preferential treatment under contractual or
autonomous trade regimes leading to the granting of tariff preferences going beyond
the application of paragraph a of Article 1 of GATT 1994” (Annex II, Paragraph 1).
Understanding Rules of Origin (2)
• Non-preferential rules of origin are used to determine the country of origin
of goods for the application of the most-favoured nation treatment (MFN)
but also for the implementation of a number of commercial policy
measures such as anti-dumping and countervailing duties, trade embargoes,
safeguard measures and quantitative restrictions or tariff quotas. They are
also used for trade statistics, public tenders and origin marking.
• Preferential rules of origin determine whether goods qualify as originating
from certain countries, for which special arrangements and agreements
apply. Where all the requirements are met, goods with preferential origin are
eligible to be imported with lower duty rates or at zero rate, depending
on the preferential tariff treatment provided for. Thus, for the customs
clearance of goods, it is necessary to determine the "nationality" of the
goods, i.e. to ascertain the country of origin of imported products.
• After the classification of a commodity into the Harmonized System and the
determination of its value, the determination of the country of origin is the
third key element in the assessment of Customs duties and taxes.
 Tariff treatment: trade Preferences
Rules of Origin ONLY ONE
Proof of Origin
NAFTA ORIGIN
0% CAN BE
ADMITTED
US-Jordan
FTA
0%
MFN

16%
US-Australia
FTA 8%
Lesotho
US GSP (AGOA)
0%
Boy’s pyjamas
76% “General Duty” HS6207.22
 Ex.1 - Import Quotas
EUROPEAN UNION
High Quality Beef import Quota Allocations 2012-13
Exporting Country Quota 2012-13 Quantity issued % allocated

Argentina 30,000 24,336 81.1

Australia 7,150 6,441 90.1
Uruguay 6,300 6,289 99.8
Brazil 10,000 2,978 29.8
New Zealand 1,300 1,281 98.5
Paraguay 1,000 0 0
United States 11,500 432 3.8
Total 67,250 41,757 62.1
Source: EU Commission
Ex.2 - Country of origin marking
 Ex.3 - Anti-Dumping Duties

Antidumping duty likely on Chinese, Korean, Thai

alloy wheels

NEW DELHI: Government is likely to impose anti-

dumping duty on a certain type of aluminium alloy
auto wheels imported from China, Thailand and
Korea, to protect domestic players from below-cost
imports.

In its preliminary findings, the Directorate General of

Anti-dumping and Allied Duties (DGAD) has
recommended imposition of duty ranging between
USD 1.18 and USD 2.15 per kg on imports of cast
aluminium alloy wheels from the three countries, the
Commerce Ministry said in a notification.
Ex.4 - Sanitary restrictions
 Customs treatment
PREFERENTIAL
• Reciprocal Trade Regimes
• Bilateral FTAs: EU-Chile, US-Korea
• Regional FTAs: EU, NAFTA, CARICOM, EU-ACP EPAs, etc.
• Non-Reciprocal Trade Regimes
• Developed countries’ GSP schemes: US Caribbean Basin Initiative,
EU GSP-plus, Canada’s General Preferential Tariff, etc.
NON PREFERENTIAL
• Regular duties (WTO’s Most Favoured Nation (MFN) Treatment)
 Summarizing…

Customs Anti-dumping or
Also: quotas and treatment: countervailing
quota allocations
import duties duties

Sanitary measures Domestic uses:

(inspection, Trade statistics Labelling
quarantine) etc… Public procurement
Where are rules of origin used?
• Rules of origin are the criteria needed to determine the national source of a
product. Their importance is derived from the fact that duties and restrictions in
several cases depend upon the source of imports.
• Rules of origin are used:
Ø to implement measures and instruments of commercial policy such as anti-dumping
duties and safeguard measures;

Ø to determine whether imported products shall receive most-favoured-nation (MFN)

treatment or preferential treatment;
Ø for the purpose of trade statistics;
Ø for the application of labelling and marking requirements; and

Ø for government procurement.

Role of rules of origin
• The basic role of rules of origin is the determination of the economic nationality as
opposed to the geographical nationality of a given good.
• There are several mandatory legal or administrative requirements to observe when
goods are traded on the international market.
• This is necessary for the implementation of various trade policy instruments such as
imposing import duties, allocating quotas or for the collection of trade statistics.
• The determination of the country of origin is the last step in the customs clearance
procedures, the first steps being the classification of the goods and the
determination of the value of the goods.
• The classification and valuation are important per se for the customs clearance, but
these are also the basic tools for the determination of the country of origin of goods
in the sense that the rules of origin are product specific rules linked to specific HS
codes, and that in order to assess if value added rules are fulfilled, the composition
of the customs value is needed.
Non-preferential vs Preferential Origin
Non-preferential vs Preferential Origin

ROO

Ưu đãi Không ưu đãi

Đa phương
Đơn phương Song phương
e.g., ATIGA,
e.g., GSP e.g., VJEPA
CPTPP
Non-preferential vs Preferential Origin
• A need for countries to distinguish the non-preferential origin of a product
exists in WTO terms if the countries wish to apply WTO rules on anti-dumping
duties, countervailing measures, safeguard measures or origin labeling.
Otherwise, non-preferential origin is only important for the collection of trade
statistics.
• The Rules of Origin that determine the Country of Origin for a product are
usually referred to as the non-preferential, or economic, Rules of Origin.
• The Rules of Origin that determine the eligibility for preferential treatment are
commonly referred to as the preferential Rules of Origin.
• An important distinction between preferential and non-preferential origin is that
preferential origin treatment is requested (by the importer) and non-preferential
origin determination is required (for the exporter).
Ví dụ về trường hợp C/O không ưu đãi trở
thành ưu đãi
• Theo quyết định số 1105/QĐ-BCT do Bộ trưởng Bộ Công Thương ký ban hành ngày
30 tháng 5 năm 2017, VN quyết định áp thuế chống bán phá giá (CBPG) chính thức
đối với một số sản phẩm tôn mạ nhập khẩu từ TQ. Mã HS sản phẩm bị áp thuế
38,34% là HS 7210.41.11 do Công ty Tangshan Branch, TQ sản xuất.

• Trong khi đó, thuế MFN đang áp dụng đối với sản phẩm này là 20%, và thuế ưu đãi
theo ASEAN-China FTA là 15% (C/O Form E).

• Như vậy, sp nhập từ Tangshan Branch, TQ sẽ chịu thuế 20%+38,34% nếu có C/O
Form E, hoặc 15%+38,34% nếu không có C/O Form E.

• Tuy nhiên nếu DN VN nhập sản phẩm tương tự từ Đài Loan với C/O không ưu đãi thì
chỉ chịu thuế MFN 20% << 53,34% hay 58,34% => C/O không ưu đãi của Đài Loan
trở nên có ýnghĩa của C/O ưu đãi.
Origin Criteria (1)
• There are some basic criteria to determine the country of origin of goods. These
are:
Ø Wholly obtained criterion,
Ø Produced entirely, and
Ø Substantial/sufficient transformation criterion.

• Wholly obtained goods are goods naturally occurring; or live animals born and
raised in a given country; or plants harvested in a given country; or minerals
extracted or taken in a single country. The definition of wholly obtained also covers
goods produced from wholly obtained goods alone or scrap and waste derived
from manufacturing or processing operations or from consumption.
• Produced entirely criterion refers to goods produced entirely from originating
materials.
• Therefore, goods that are produced using non-originating materials will have
to undergo substantial transformation in a country for the good to be qualified
as originating.
Origin Criteria (1)

Origin Criteria

Wholly Produced Substantial

Obtained Entirely Transformation

Change in Tariff Local (Regional)

Classification Value Content Process rule
(CTC) (LVC/RVC)
Origin Criteria (1): List of “WO” Products
The following categories of products can qualify as wholly obtained (thuần túy)
in an originating country:
1. mineral products extracted from its soil or from its sea bed;
2. vegetable products harvested there;
3. live animals born and raised there;
4. products obtained there from live animals;
5. products obtained by hunting or fishing conducted there;
6. products of sea fishing and other products taken from the sea by its vessels;
7. products made on board its factory ships exclusively from the products referred to
in para (6) above;
8. used articles collected there fit only for the recovery of raw materials;
9. waste and scrap resulting from manufacturing operations conducted there;
10. products obtained there exclusively from the products specified in (1) to (9) above
(such as iron sheets, bars produced from iron ore, cotton fabrics woven from raw
cotton, recovery of lead from used motor-car batteries, recovery of metal from metal
shavings) .
Origin Criteria (2)
• Substantial or sufficient transformation: there are three (3) major criteria to
express a substantial/sufficient transformation.
i. A criterion of a change in tariff classification (CTC)
ii. A criterion of value added (ad valorem percentages)
iii. A criterion of manufacturing or processing operations (technical requirement)
• Criterion of a change in tariff classification: A good is considered substantially
transformed when the good is classified in a heading or subheading
(depending on the exact rule) different from all non-originating materials used.
• CC (Change in Chapter), Change in Tariff (Sub)-Heading (CTH/CSTH)
Example:
2523.10 - Cement clinkers CTH
- Porland cement:
Origin Criteria (3)
• Criterion of value added (ad valorem percentages): Regardless a change in its
classification, a good is considered substantially transformed when the value
added of a good increases up to a specified level expressed by ad valorem
percentage.
• The value-added criterion can be expressed in two ways, namely a maximum
allowance for non-originating materials or a minimum requirement of domestic
content.

Example:
85.29 Parts suitable for use solely or principally 45% added value
with the apparatus of headings from
85.25 to 85.28
Origin Criteria (4)
• Criterion of manufacturing or processing operations (technical
requirement): Regardless a change in its classification, a good is considered
substantially transformed when the good has undergone specified
manufacturing or processing operations.

Example:
Ex 70.01(a) - Cullet and other The origin shall be the country of
waste and scrap of cullet and other waste and scrap
glass of glass where the goods are
derived or collected from
manufacturing or processing
operations or from
consumption
Glass recycling is the processing of waste glass into usable
products. Glass that is crushed and ready to be remelted is called
cullet.[1] There are two types of cullet: internal and external.
Internal cullet is composed of defective products detected and
rejected by a quality control process during the industrial process
of glass manufacturing, transition phases of product changes
(such as thickness and colour changes) and production offcuts.
External cullet is waste glass that has been collected or
reprocessed with the purpose of recycling. External cullet (which
can be pre- or post-consumer) is classified as waste. The word
"cullet", when used in the context of end-of-waste, will always
refer to external cullet.
To be recycled, glass waste needs to be purified and cleaned of
contamination. Then, depending on the end use and local
processing capabilities, it might also have to be separated into
different colors. Many recyclers collect different colors of glass
separately since glass retains its color after recycling. The most
common colours used for consumer containers are clear (flint)
glass, green glass, and brown (amber) glass. Glass is ideal for
recycling since none of the material is degraded by normal use.
Many collection points have separate bins for clear (flint), green
and brown (amber). Glass re-processors intending to make new
glass containers require separation by color, because glass tends
to retain its color after recycling. If the recycled glass is not going
to be made into more glass, or if the glass re-processor uses
newer optical sorting equipment, separation by color at the
collection point may not be required. Heat-resistant glass, such
as Pyrex or borosilicate glass, must not be part of the glass
recycling stream, because even a small piece of such material will
alter the viscosity of the fluid in the furnace at remelt.
Origin Criteria (5)
• Minimal operations
A reverse form of the specific manufacturing operations above can be found in the
Agreement on Non-Preferential Rules of Origin as well as in many preferential trade
agreements, whereby specifically identified manufacturing operations are insufficient
to confer origin (e.g. labeling, packaging or assembly).

• De minimis or tolerance rule

The de minimis or tolerance rule permits a specific share (often between 10% and
15%) of the value or volume of the final product to be non-originating without the final
product loosing its originating status.
In some agreements, the components to which the rule applies are specifically
identified. Alternatively, there may be a negative list of components that may not be
included in the allowance or a list of products (e.g. HS Chapters) to which the
tolerance rule does not apply.
Origin Criteria (5 cont’d)
Products which have only undergone the commonly following 'minimal
processes' would not qualify as of originating country:

1. operations to ensure the preservation of products in good condition during

transport and storage (ventilation, spreading out, drying, chilling, placing in salt,
sulphur dioxide or other aqueous solutions, removal of damaged parts, and like
operations);
2. simple operations consisting of removal of dust, sifting or screening, sorting,
classifying, matching (including the making up of sets of articles), washing,
painting, cutting up;
3. (i) changes of packing and breaking up and assembly of consignments;
(ii) simple placing in bottles, flasks, bags, cases, boxes, fixing on cards or
boards, and all other simple packing operations;
4. the affixing of marks, labels or other like distinguishing signs on products or
their packaging;
5. simple mixing of products, whether or not of different kinds;
6. simple assembly of parts of products to constitute a complete product;
7. a combination of two or more operations specified in (1) to (6);
8. slaughter of animals.
 PART II: NON-
PREFERENT IAL ORIGIN
Non-preferential Origin
• Non-preferential origin refers to the Country of Origin determination that is
performed by the exporter. The result is the identification of the Country of
origin of the exported item.
• This Country of Origin is the one that appears on all relevant documents and
marking/labeling associated with the product and is therefore also known as
Commercial Origin or Economic Origin.

Why non-preferential origin is important?

• Non-preferential origin is important as based on the country of origin, a wide
variety of trade measures are taken.
• For example, without proper identification of the country of origin, how can a
country install safeguard measures or limit importations from a certain country?
Non-preferential Origin
Why non-preferential origin is important? (cont’d)
• It is also for that reason the country of origin is determined independent of the
country from which the goods are (eventually) exported; in cases where goods
are not shipped directly from the country of origin of the product, the importing
country will still want to apply the appropriate measures that relate to the
country of origin and not the ones that associate with the country from which
the goods were shipped.
• For example, without proper identification of the country of origin, how can a
country install safeguard measures or limit importations from a certain country?
• The most common application for non-preferential rule of origin is arguably
labeling. Practically each product has a label that indicates what the country of
origin is or where the product was made.
Non-preferential Origin
Why non-preferential origin is important? (cont’d)
• It is also for that reason the country of origin is determined independent of the
country from which the goods are (eventually) exported; in cases where goods
are not shipped directly from the country of origin of the product, the importing
country will still want to apply the appropriate measures that relate to the
country of origin and not the ones that associate with the country from which
the goods were shipped.
• For example, without proper identification of the country of origin, how can a
country install safeguard measures or limit importations from a certain country?
• The most common application for non-preferential rule of origin is arguably
labeling. Practically each product has a label that indicates what country goes
on the label since the producers may make use of raw materials originated from
different countries.
Non-preferential Origin
Why non-preferential origin is important? (cont’d)
• There are some basic import functionalities for which the country
of origin is needed. These include duty rate determination,
statistics, and simple document requirements (the country of
origin is a required field for every import filing).
• Additionally, it is the non-preferential country of origin that is used
in the preferential origin calculations and based on the declared
Country of Origin of the subcomponents, products may or may
not qualify for preferential treatment.
Non-preferential Origin
• The Ordinary Certificate of Origin (CO) is issued for a product which
meets any of the following criteria:

a) Wholly Obtained (i.e. wholly grown or produced, refer to Annex I);

b) Manufactured in the exporting country (say, Vietnam) with minimum threshold

level (as per percentage, say, 30%) of Local Content based on the ex-factory price
(FOB price) of the finished product;

c) Attained a Change in Tariff Classification at 6-digit level (i.e., Change in Tariff

SubHeading); or

d) Undergone a Chemical Reaction (only for products under HS Chapters 27 to

40).
Non-preferential Origin (cont’d)
Nghị định số 31/2018/NĐ-CP
Điều 6. Quy tắc xuất xứ hàng hóa không ưu đãi
1. Hàng hóa xuất khẩu, hàng hóa nhập khẩu được coi là có xuất xứ thuần túy hoặc được sản xuất
toàn bộ tại một nước, nhóm nước, hoặc vùng lãnh thổ nếu đáp ứng quy định tại Điều 7 Nghị định
số 31/2018/NĐ-CP ngày 08 tháng 3 năm 2018 của Chính phủ quy định chi tiết Luật Quản lý ngoại
thương về xuất xứ hàng hóa (sau đây gọi tắt là Nghị định số 31/2018/NĐ-CP).
2. Hàng hóa xuất khẩu, hàng hóa nhập khẩu được coi là có xuất xứ không thuần túy hoặc không
được sản xuất toàn bộ tại một nước, nhóm nước, hoặc vùng lãnh thổ nếu đáp ứng tiêu chí xuất
xứ thuộc Danh Mục Quy tắc cụ thể mặt hàng quy định tại Phụ lục I ban hành kèm theo Thông tư
này để hướng dẫn Điều 8 Nghị định số 31/2018/NĐ-CP. Các tiêu chí xuất xứ hàng hóa không ưu
đãi tại Phụ lục I được xác định như sau:
a) Tiêu chí “Chuyển đổi mã số hàng hóa” (sau đây gọi tắt là CTC): là sự thay đổi về mã HS của
hàng hóa ở cấp 2 (hai) số, 4 (bốn) số hoặc 6 (sáu) số so với mã HS của nguyên liệu đầu vào
không có xuất xứ (bao gồm nguyên liệu nhập khẩu và nguyên liệu không xác định được xuất xứ)
dùng để sản xuất ra hàng hóa đó.
b) Tiêu chí “Tỷ lệ Phần trăm giá trị” (sau đây gọi tắt là LVC): được tính theo công thức quy định tại
Khoản 3 Điều này.
Non-preferential Origin (cont’d)
Nghị định số 31/2018/NĐ-CP
Điều 6. Quy tắc xuất xứ hàng hóa không ưu đãi
1. Hàng hóa xuất khẩu, hàng hóa nhập khẩu được coi là có xuất xứ thuần túy hoặc được sản xuất
toàn bộ tại một nước, nhóm nước, hoặc vùng lãnh thổ nếu đáp ứng quy định tại Điều 7 Nghị định
số 31/2018/NĐ-CP ngày 08 tháng 3 năm 2018 của Chính phủ quy định chi tiết Luật Quản lý ngoại
thương về xuất xứ hàng hóa (sau đây gọi tắt là Nghị định số 31/2018/NĐ-CP).
2. Hàng hóa xuất khẩu, hàng hóa nhập khẩu được coi là có xuất xứ không thuần túy hoặc không
được sản xuất toàn bộ tại một nước, nhóm nước, hoặc vùng lãnh thổ nếu đáp ứng tiêu chí xuất
xứ thuộc Danh Mục Quy tắc cụ thể mặt hàng quy định tại Phụ lục I ban hành kèm theo Thông tư
này để hướng dẫn Điều 8 Nghị định số 31/2018/NĐ-CP. Các tiêu chí xuất xứ hàng hóa không ưu
đãi tại Phụ lục I được xác định như sau:
a) Tiêu chí “Chuyển đổi mã số hàng hóa” (sau đây gọi tắt là CTC): là sự thay đổi về mã HS của
hàng hóa ở cấp 2 (hai) số, 4 (bốn) số hoặc 6 (sáu) số so với mã HS của nguyên liệu đầu vào
không có xuất xứ (bao gồm nguyên liệu nhập khẩu và nguyên liệu không xác định được xuất xứ)
dùng để sản xuất ra hàng hóa đó.
b) Tiêu chí “Tỷ lệ Phần trăm giá trị” (sau đây gọi tắt là LVC): được tính theo công thức quy định tại
Khoản 3 Điều này.
Non-preferential Origin (cont’d)
Nghị định số 31/2018/NĐ-CP & Thông tư 05/2018/TT-BCT
Điều 6. Quy tắc xuất xứ hàng hóa không ưu đãi (cont’d)
3. LVC được tính theo một trong hai công thức sau:
a) Công thức trực tiếp

Trị giá nguyên liệu đầu vào có xuất xứ từ nước, nhóm nước, hoặc vùng lãnh thổ
𝐿VC = ×100
Trị giá FOB
b) Công thức gián tiếp

Trị giá FOB − Trị giá nguyên liệu đầu vào không có xuất xứ từ
nước, nhóm nước, hoặc vùng lãnh thổ
𝐿VC = ×100
Trị giá FOB
Non-preferential Origin (cont’d)
Nghị định số 31/2018/NĐ-CP
Điều 6. Quy tắc xuất xứ hàng hóa không ưu đãi (cont’d)
3. LVC được tính theo một trong hai công thức sau (cont’d)
Nhà sản xuất hoặc thương nhân đề nghị cấp C/O lựa chọn công thức trực tiếp hoặc
công thức gián tiếp để tính LVC và thống nhất áp dụng công thức đã lựa chọn trong
suốt năm tài chính đó. Việc kiểm tra, xác minh tiêu chí LVC đối với hàng hóa xuất khẩu
của Việt Nam cần dựa trên công thức tính LVC mà nhà sản xuất hoặc thương nhân đề
nghị cấp C/O đã sử dụng.
4. Để tính LVC theo công thức nêu tại Khoản 3 Điều này, trị giá nguyên liệu và các chi
phí trong toàn bộ quá trình sản xuất ra hàng hóa được xác định cụ thể như sau:
a) “Trị giá nguyên liệu đầu vào có xuất xứ từ nước, nhóm nước, hoặc vùng lãnh thổ sản
xuất” bao gồm trị giá CIF của nguyên liệu thu mua hoặc sản xuất trong nước có xuất xứ
từ một nước, nhóm nước, hoặc vùng lãnh thổ; chi phí nhân công trực tiếp, chi phí phân
bổ trực tiếp, các chi phí khác và lợi nhuận.
Non-preferential Origin (cont’d)
Nghị định số 31/2018/NĐ-CP
Điều 6. Quy tắc xuất xứ hàng hóa không ưu đãi (cont’d)
4. Để tính LVC theo công thức nêu tại Khoản 3 Điều này … (cont’d)
b) “Trị giá nguyên liệu đầu vào không có xuất xứ từ nước, nhóm nước, hoặc vùng lãnh thổ sản
xuất” là trị giá CIF của nguyên liệu nhập khẩu trực tiếp đối với nguyên liệu có xuất xứ từ một
nước, nhóm nước, hoặc vùng lãnh thổ khác; hoặc giá mua đầu tiên tại thời điểm mua vào ghi trên
hóa đơn giá trị gia tăng đối với nguyên liệu không xác định được xuất xứ dùng để sản xuất, gia
công, chế biến ra sản phẩm cuối cùng.
c) “Trị giá FOB” là trị giá ghi trên hợp đồng xuất khẩu và được tính như sau: “Trị giá FOB = Giá
xuất xưởng + các chi phí khác”.
- “Giá xuất xưởng" = Chi phí xuất xưởng + Lợi nhuận;
- “Chi phí xuất xưởng” = Chi phí nguyên liệu + Chi phí nhân công trực tiếp + Chi phí phân bổ trực
tiếp;
- “Chi phí nguyên liệu” bao gồm chi phí mua nguyên vật liệu, chi phí vận tải và bảo hiểm đối với
nguyên vật liệu đó;
- “Chi phí nhân công trực tiếp” bao gồm lương, các Khoản thưởng và những Khoản phúc lợi khác
có liên quan đến quá trình sản xuất;
Non-preferential Origin (cont’d)
Nghị định số 31/2018/NĐ-CP
Điều 6. Quy tắc xuất xứ hàng hóa không ưu đãi (cont’d)
4. Để tính LVC theo công thức nêu tại Khoản 3 Điều này … (cont’d)
- “Chi phí phân bổ trực tiếp” bao gồm: Chi phí nhà xưởng có liên quan đến quá trình
sản xuất (bảo hiểm nhà xưởng, chi phí thuê và thuê mua nhà máy, khấu hao nhà
xưởng, sửa chữa, bảo trì, thuế, lãi cầm cố); các Khoản thuê mua và trả lãi của nhà máy
và thiết bị; an ninh nhà máy; bảo hiểm (nhà máy, thiết bị và vật tư sử dụng trong quá
trình sản xuất hàng hóa); các nhu yếu phẩm cho quá trình sản xuất (năng lượng, điện
và các nhu yếu phẩm khác đóng góp trực tiếp sử dụng trong quá trình sản xuất); nghiên
cứu, phát triển, thiết kế và chế tạo; khuôn dập, khuôn đúc, việc trang bị dụng cụ và
khấu hao, bảo trì và sửa chữa của nhà máy và thiết bị; tiền bản quyền sáng chế (có liên
quan đến những máy móc có bản quyền hoặc quá trình sử dụng trong việc sản xuất
hàng hóa hoặc quyền sản xuất hàng hóa); kiểm tra và thử nghiệm nguyên liệu và hàng
hóa; lưu trữ trong nhà máy; xử lý các chất thải; các nhân tố chi phí trong việc tính toán
giá trị của nguyên liệu như chi phí cảng và chi phí giải phóng hàng và thuế nhập khẩu
đối với các thành Phần phải chịu thuế;
Non-preferential Origin (cont’d)
Nghị định số 31/2018/NĐ-CP
Điều 6. Quy tắc xuất xứ hàng hóa không ưu đãi (cont’d)
4. Để tính LVC theo công thức nêu tại Khoản 3 Điều này … (cont’d)
- “Các chi phí khác” là các chi phí phát sinh trong việc đưa hàng lên tàu để xuất
khẩu, bao gồm nhưng không giới hạn bởi chi phí vận tải nội địa, chi phí lưu kho, chi
phí tại cảng, phí hoa hồng, phí dịch vụ, và các phí có liên quan trong quá trình đưa
hàng lên tàu để xuất khẩu.

5. Nhà sản xuất hoặc thương nhân đề nghị cấp C/O lựa chọn tiêu chí xuất xứ nêu
tại Khoản 1 hoặc Khoản 2 Điều này để kê khai, cam kết xuất xứ phù hợp với bản
chất hàng hóa được sản xuất ra với Điều kiện hàng hóa đáp ứng tiêu chí xuất xứ
đó và các quy định khác thuộc Chương III Nghị định số 31/2018/NĐ-CP.
Non-preferencial C/O (C/O Form B)
C/O Form B’s Issuing Procedure

Qui trinh VCCI

 C/O Form B’s Issuing Procedure
Bước Tên bước Mô tả Đối tượng sử dụng
1. Khai báo hồ sơ đề nghị cấp Doanh nghiệp khai báo hồ sơ trên hệ thống gồm: Doanh nghiệp
giấy chứng nhận xuất xứ + Khai báo đơn xin cấp trên hệ thống
+ Scan các file đính kèm.
- Dung lượng tối đa: không quá 10mb
2. Tự động cấp số C/O Hệ thống VCCI sẽ tự động cấp số C/O khi doanh nghiệp hoàn thành kê Hệ thống VCCI
khai trên hệ thống.
2.1 Tiếp nhận số C/O Hệ thống DN tiếp nhận số C/O. Doanh nghiệp
2.2 Sửa hồ sơ DN có thể sửa hồ sơ khi chưa có xác nhận của chuyên viên VCCI xử lý Doanh nghiệp
hồ sơ.
3 Gửi hồ sơ DN gửi hồ sơ sau khi hoàn thiện Doanh nghiệp
4 Tiếp nhận hồ sơ Hệ thống VCCI tiếp nhận hồ sơ được gửi từ hệ thống DN. Hệ thống VCCI
5. Xét duyệt hồ sơ Chuyên viên VCCI thực hiện xem xét hồ sơ. Hệ thống VCCI
Nếu hồ sơ không đầy đủ: chuyển bước 6.
Nếu hồ sơ đầy đủ: chuyển sang bước 7.
6. Từ chối hồ sơ Chuyên viên VCCI từ chối hồ sơ. Yêu cầu nhập: Hệ thống VCCI
- Lý do từ chối.
6.1 Nhận TB từ chối hồ sơ Doanh nghiệp nhận TB từ chối từ hệ thống VCCI và thực hiện bổ sung, Doanh nghiệp
chỉnh sửa thông tin theo bước 6.2
6.2 Bổ sung, chỉnh sửa thông Doanh nghiệp bổ sung, chỉnh sửa thông tin theo yêu cầu rồi gửi lại hồ sơ. Doanh nghiệp
tin Quy trình quay trở lại bước 3.
7. Duyệt cấp C/O Khi hồ sơ đầy đủ, chuyên viên xem xét rồi duyệt cấp C/O cho doanh Hệ thống VCCI
nghiệp.
7.1 Nhận thông báo hồ sơ được DN nhận thông báo hồ sơ được duyệt cấp C/O Doanh nghiệp
duyệt cấp C/O

8 Ký và đóng dấu trên form VCCI ký, đóng dấu trên form C/O và trả cho DN VCCI
C/O
 PART III:
PREFERENT IAL ORIGIN
Preferential Origin
• Preferential rules of origin are set out under the preferential trade arrangements,
which facilitate trade from developing countries (within the frames of the General
System of Preferences (GSP)) or between contracting parties (e.g. FTA, RTA) by
offering a reduced or zero rate of duty to goods exported from beneficiary
countries or contracting parties. To benefit from the preferential trade arrangements
the goods exported must be originating in the beneficiary country or the contracting
party.
• Preferential rules of origin are more restrictive than non-preferential ones. The
theoretical reason for this is to prevent “trade deflection”.
• Trade deflection involves transshipment of a good via a preference-holding
country in order for the good upon import to obtain the preferential treatment
available under a preferential trade agreement.
• Preferential rules of origin may serve as well other purposes than prevention
against trade deflection. Principally they may act as non-tariff instruments of
protection with domestic production requirements that are difficult to meet.
Preferential Origin (1)
What is an originating good?
• A good is considered to be originating if it meets the origin
criteria(on) stipulated in the Rules of Origin (ROO) chapter of a
Free Trade Agreement (FTA).
• An originating good in an exporting Party can be broadly
classified under 2 categories :
a) A good that is “Wholly Obtained (WO)” i.e. wholly grown or
produced; or
b) A good that is manufactured using non-originating materials.
Preferential Origin (2)
Non-originating materials are
materials/components –

a) Imported from a country that is not a

Party to the Free Trade Agreement
(FTA);

b) Produced in one of the Parties to the

FTA but are not able to meet the Rules
of Origin under the FTA; or

c) Whose origin cannot be determined.

Preferential Origin (3)
Structure of preferential Rules of Origin: some of the basic elements of a
preferential trade agreement are:
• Origin criteria (WO, CTC, RVC and Process Rule)
• Direct consignment rule
• Document evidence
• Prohibition of duty drawback

(A) Origin criteria: Wholly Obtained goods definitions / Substantial or sufficient

transformation criteria or manufacturing or processing operations.
Note 1: “minimal operations or processes” and “de minimis or tolerance rule” are
applied.
Preferential Origin (cont’d)
Origin criteria: Wholly Obtained goods definitions / Substantial or sufficient
transformation criteria or manufacturing or processing operations.
Note 2: Cumulation rules
• Under “cumulation” rules, contracting parties to a preferential trade agreement
or beneficiary countries under the GSP regimes may source non-originating raw
materials or components from specified countries and count them as
originating. There are three types of cumulation:
o Bilateral cumulation, where only raw material or components in the preference-
granting country can be counted in this way,

o Diagonal cumulation, where raw materials or components from the preference-

granting country and a list of other designated countries to which the same rules of
origin apply can be counted, and

o Full cumulation, where raw materials from all countries to which the same rules of
origin apply can be counted.
Preferential Origin (cont’d)
(B) Direct consignment rule: Most rules of origin require the direct consignment of
goods, meaning that for a product to be eligible for origin treatment it must be
transported directly from the place of production to its preferential destination.

The purpose of such a rule is primarily to ensure that the imported goods, in particular
bulk cargo etc. whose identity is difficult to establish, are identical with the goods that
left the exporting country and to reduce the risk of eligible goods being mixed with
noneligible goods.

Provision is, however, made in most rules of origin that goods may be transported
through territory other than that of their origin or final destination if this is justified,
e.g. for geographical reasons and if the goods in question have remained under
customs surveillance and have not entered into the commerce of the transit country. A
certificate of non-manipulation from the transit country can be required in the country
of destination.
Preferential Origin (cont’d)
(C) Documentary evidence:
A documentary evidence of origin is required for a good to benefit from the
preferential regimes. The evidence can be a certificate of origin issued by the
competent authorities, a certified declaration of origin certified by a competent
authority or an origin declaration made on a commercial document (e.g. invoice)
by the manufacturer, producer, supplier, exporter, importer or other competent
person.
(D) Prohibition of duty drawback
Another aspect of the rules of origin in preferential trade agreements is
that they are always accompanied by more or less restrictive
administrative conditions. A frequent condition is a prohibition on
beneficiary countries to provide their exporters with remission or
exemption of import duties (duty drawback) on non-originating raw
materials or components, where these enter into products benefiting from
a preferential treatment when the final product is exported.
More on Origin Criteria
(A)Wholly Obtained: as previous definitions

(B) Goods that are produced using non-originating materials will

have to undergo substantial transformation in a country for the
good to be qualified as originating. The methods used to measure
the transformation change are:
i) Change in Tariff Classification (CTC);
ii) Local (Regional) Value Content (LVC/RVC);
iii) Process rule
These 3 methods can be used in combination or standalone, depending on the
origin criteria(on) for the good in a Free Trade Agreement (FTA). The origin of
these goods would be dependent on the country where the last substantial
transformation is performed
 CTC Method

CTC

Change in Chapter Change in Tariff Change in Tariff Sub-

(CC) Heading (CTH) heading (CTSH)
(1st 2 digits) (1st 4 digits) (1st 6 digits)
CTC: Example 1 (2 digits)
Consider the FTA between Country A and Country B (FTAAB)

Good: Strawberries Jam (Mứt dâu) (HS 2007.99)

Rules of Origin (ROO): A Change to heading 20.07 from any other Chapter (CC).
Assessment: The strawberries jam is classified under chapter 20 while the
strawberries fruit and sugar are classified under chapters 08 and 17 respectively.
However, strawberries fruit and sugar are non-originating since they are
imported from Country C and D, respectively (Non-Parties to FTAAB). The
strawberries jam is an originating good under FTAAB because a
change from chapters 08 and 17 to chapter 20 has occurred.
CTC: Example 2 (4 digits)
Consider the FTA between country A and B
Good: Crocodile Leather Handbag (HS 4202.21)

Rules of Origin (ROO): A Change to heading 42.01 through 42.03 from

any other Heading (CTH).
Assessment: The crocodile leather (HS Heading 41.15) is a non-originating material as it
is imported from Country E, a non-Party to FTAAB. The leather handbag is an
originating good under FTAAB because a change from HS Heading 41.15 to HS
Heading 42.02 has occurred.
Regional Value Content (RVC) Method
• This rule requires that a certain percentage of the good’s value originates in a Party
to the Free Trade Agreement (FTA) for the good to be considered as originating.
There are generally two approaches that can be used to calculate the RVC:
a) Build-Up (BU); or
b) Build-Down (BD).
• BU approach
𝑅𝑉𝐶
𝑉𝑎𝑙𝑢𝑒 𝑜𝑓 𝑟egionally 𝑝𝑟𝑜𝑑𝑢𝑐𝑒𝑑 𝑚𝑎𝑡𝑒𝑟𝑖𝑎𝑙𝑠 + 𝑑𝑖𝑟𝑒𝑐𝑡 𝑙𝑎𝑏𝑜𝑟&𝑜𝑣𝑒𝑟ℎ𝑒𝑎𝑑 + 𝑝𝑟𝑜𝑓𝑖𝑡
= ×100%
𝐹𝑂𝐵 𝑉𝑎𝑙𝑢𝑒
• BD approach
𝐹𝑂𝐵 𝑉𝑎𝑙𝑢𝑒 − 𝑉𝑎𝑙𝑢𝑒 𝑜𝑓 𝑛𝑜𝑛_𝑜𝑟𝑖𝑔𝑖𝑛𝑎𝑡𝑖𝑛𝑔 𝑚𝑎𝑡𝑒𝑟𝑖𝑎𝑙𝑠
𝑅𝑉𝐶 = ×100%
𝐹𝑂𝐵 𝑉𝑎𝑙𝑢𝑒
The full value of a locally produced material may only be included in the numerator of
the calculation if the material is an originating material.
RVC Method: Example
FTA: ASEAN Trade In Goods Agreement (ATIGA)
Good: Biscuit (HS 1905.31)
ROO: A RVC of not less than 40% of the FOB value

Raw Material Origin Value

Flour (non-originating) Malaysia $5
Sugar (non-originating) Thailand $2.50
Flavour essence (non-originating) Singapore $1
Eggs (originating) Vietnam $3
Direct Labour & Overhead - $2
Profit - $1.50
FOB $15
 RVC Method: Example
Raw Material Origin Value
OPQPR.T Flour (non- Malaysia $5
RVC (BU Approach) = ×100% = 43.33% originating)
RT
RUVTVQ.TVR Sugar (non- Thailand $2.50
RVC (BD Approach) = ×100% = 43.33% originating)
RT
Flavour essence Singapore $1
(non-originating)
Assessment: The RVC of the biscuit is 43.33% Eggs Vietnam $3
(greater than the lower bound of 40%). Hence, (originating)
the biscuit meet the ATIGA ROO requirement soDirect Labour & - $2
that it can be labelled as “Made in Vietnam”. Overhead
Profit - $1.50
FOB $15
Process Rule Method
This is usually applicable for chemical goods where the goods will be
considered as originating if it is produced through a specific chemical
process that occurred in a Party to the Free Trade Agreement.

Example
FTA: Japan-Singapore Economic Partnership Agreement
Good: Polypropylene paste (HS 3902.10)
ROO under JSEPA: No required change in tariff classification to
heading 39.01 through 39.26, provided that non-originating materials
used undergo a chemical reaction, purification, isomer separation or
biotechnological processes in a Party.
CTC/RVC Flexibility 1
Manufacturers and exporters may still be conferred the origin even
when their goods could not meet the CTC/RVC criterion, provided it is
applied for in the FTA.

De Minimis
• The de minimis rule only applies to Change in Tariff Classification
(CTC). Specifically, it applies to non-originating materials that do not
meet the CTC requirement.
• The de minimis rule varies among the different FTAs. For example, in
the ATIGA, it allows for a 10% FOB tolerance level of non-originating
materials that do not meet the CTC requirements for all goods.
CTC/RVC Flexibility
De Minimis rule example
FTA: ASEAN – Japan Comprehensive Economic Partnership
Good: Solar paste (HS 3207.30)
ROO: A change in tariff classification at the 4-digit level of HS
Raw Material Origin HS Heading Pass CTH? Value
Glass powder MY 32.07 No $1
Chemical AU 34.02 Yes $15
FOB: $20
De minimis rule of non-originating CTC goods under AJCEP: <=10%.
Assessment: Glass power is the only non-originating material, which is
of 5% FOB value => The solar paste is an originating good (AJCEP).
CTC/RVC Flexibility 2
Accumulation
• The accumulation concepts applies to both CTC and RVC criterion. With
accumulation, applicant is encouraged to procure originating raw materials from
within the Party(ies) of the same FTA since these materials will be treated as though
they are locally produced.
• For example, under the accumulation provision of ATIGA, a producer in Singapore
is able to treat imported materials that are of Vietnam origin as though they are of
Singapore origin when determining whether the good meets the Rules of Origin
(ROOs) requirements to be considered as an originating good.
• To use this provision, the producer would have to prove that the imported materials
from Vietnam are originating materials under ATIGA.
• She would have to obtain the Preferential Certificate of Origin (CO) under ATIGA
(i.e. Form D) to demonstrate that they are originating materials under ATIGA.
CTC/RVC Flexibility 2
Accumulation Example
Raw Material Origin Value
Flour (non-originating) New Zealand $5
Sugar (originating) Thailand $2.50
Flavour essence (originating) Singapore $1
Eggs (originating) Vietnam $3
Direct Labour & Overhead - $2
Profit - $1.50
FOB $15

RVC (BU Approach) = (2.5+1+3+2+1.5)/15 = 66.67% > 40%

RVC (BD Approach) = (15 – 5)/15 = 66.67% > 40%
More exercises
Plastic Boxes
• Boxes of heading 39.23 are covered in the specific origin rules under
“39.22 to 39.26 – articles of plastics”
More exercises
Plastic Boxes 1
• Ex-factory price : $4
• Value of imported PE/PP granules from UAE : $3

Plastic Boxes 2
• Ex-factory price : $4
• Value of PE/PP granules from Dung Quat : $2

Which one can be regarded as ”Made in Vietnam” under LVC rule?

More exercises
Table Lamp (Đèn bàn)
• Ex-factory price : EUR 20
• Material cost : EUR 9.38
Non-originating materials
More exercises
Wheels for toy tricycles
• Wheels for toy tricycles of heading 95.03
are manufactured from the following
nonoriginating materials:
More exercises
Thép dây (Steel wire) HS 7217
• Được sản xuất từ sắt dạng thanh hoặc que HS 72.13 nhập từ China.
• ATIGA ROO:
THIS IS THE
END OF THE
COURSE