Certificate of Origin

A Certificate of Origin (CO) is an important international trade document that certifies that the goods in an export shipment were entirely obtained, produced, manufactured, or processed in a specific country. They declare the product's 'nationality' and also serve as a declaration by the exporter to meet customs or trade requirements.

Categories of Certificate of Origin

Preferential Certificate of Origin

A preferential certificate of origin is a document that certifies that the goods in a specific shipment meet the definitions of a specific bilateral or multilateral free trade agreement. This certificate is typically required by importing countries to determine whether imports are eligible for preferential treatment under the applicable agreement.

Certificates of origin are more practical because they allow for benefit claims beyond MFN treatment. The majority of discussion on certificates of origin usually focuses on the preferential one. The sections on forms and formats below will help to clarify the variety of this type of certificate of origin.

Non-Preferential Certificate of Origin

Non-preferential origin certificates are used within the WTO framework for most-favored-nation treatment, as specified in Article 1.2 of the Agreement on Rules of Origin. This type of certificate certifies the product's country of origin but does not entitle it to preferential tariffs under preferential trade regimes.

During trade wars, a certificate of origin may be required to show that the product in question is not from a sanctioned country. Products originating in countries subject to trade remedies are subject to non-preferential rules of origin, so this form could be required.

Importance of Certificate of Origin

Certificate of origin is required in international trade transactions. It certifies the origin of the product, which serves as the basis for determining tariffs and other trade measures.

Unlike the exporter or manufacturer, the importer frequently has little knowledge of how the product meets the origin criteria. The importer is required to provide proof. An importer's failure to submit a certificate of origin may result in the product being denied preferential treatment.

Customs

• Ensures the traceability and security of goods entering a country.
• Determines applicable taxes and duties based on the goods.
• Relies on Chamber expertise in certification rules and procedures.

Chambers

• Issued by the Chambers of Commerce.
• Understanding of globally accepted certification rules and procedures
• Recognized as trustworthy third parties and legitimate authorities

Exporters

• Customs clearance is simpler and faster.
• Gains in productivity for businesses.

Documents Required to be submitted along with application of Certificate of Origin

• A covering letter (on original letterhead) addressed to the Director General of the Indian Chamber of Commerce, requesting the issuance of a Certificate of Origin/certification of copies of invoices/packing list, etc.
• When submitting by Authorized Signatory, an attested copy of the authorization letter must be included.
• A completed Certificate of Origin Form. Blank Certificate of Origin Forms must be purchased at a cost from ICC.
• All documents, including the invoice, packing list, letter of credit, purchase order, or e-mail order (whichever is applicable), must be stamped and signed by the Exporter Applicant.
• In the case of goods imported prior to exportation to another country, relevant clearance certificates from the Customs Department must be submitted to demonstrate that the goods entered the country legally after payment of all applicable taxes and duties.
• With each Certificate of Origin application, the exporter must submit an additional set of documents for ICC records.

Tariff preferences granted to India under various schemes

Generalized System of Preference (GSP)

This system is in place to help developing countries by giving them preferential treatment in trade tariffs imposed by industrialized and developed countries. It is a unilateral non-contractual instrument based on a non-reciprocity extension of tariff concessions.

Global System of Trade Preference (GSTP)

This system extends tariff concessions among developing countries that have signed an agreement. The Export Inspection Council (EIC) is the sole authority under GSTP to issue Certificates of Origin.

SAARC Preferential Trading Agreement (SAPTA)

Tariff concessions are only available to SAARC member countries.

Asia-Pacific Trade Agreement (APTA)

Under APTA, India, China, South Korea, Sri Lanka, and Bangladesh currently exchange tariff concessions. APTA seeks to reduce tariff and non-tariff barriers to trade in the Economic and Social Commission for Asia and the Pacific (ESCAP) region.

India-Sri Lanka Free Trade Agreement (ISLFTA)

This is a free trade agreement signed by India and Sri Lanka. EIC has sole authority to issue Certificates of Origin under this agreement.

Indo-Thailand Free Trade Agreement

This agreement between India and Thailand is to implement the Early Harvest Scheme, which gives tariff preference to products covered by this protocol. Under the India-Thailand Free Trade Agreement, the Early Harvest Scheme provides tariff preferences for imports of items that meet the Rules of Origin criteria specified by the Department of Revenue, Ministry of Finance. Under this protocol, the Export Inspection Council is the sole agency authorized to issue Certificates of Origin.

India-Malaysia Comprehensive Economic Cooperation Agreement (IMCECA)

The EIC is the sole authority to issue Certificates of Origin under this agreement between India and Malaysia.

India-Korea Comprehensive Economic Partnership Agreement (CEPA)

The Comprehensive Economic Partnership Agreement (CEPA) was signed by India and South Korea to expand business and commercial opportunities between the two countries. Under this agreement, EIC has sole authority to issue Certificates of Origin.

India-Japan Comprehensive Economic Partnership Agreement (IJCEPA)

This agreement is between India and Japan to improve and protect bilateral investments. The EIC has sole authority to issue Certificates of Origin under this agreement.

ASEAN-India Free Trade Agreement

ASEAN Member States and India have agreed to open their respective markets by gradually reducing and eliminating duties on goods with a 76.4 percent coverage.