Circular No. 12/2009/TT-BCT dated May 22, 2009 of the Ministry of Industry and Trade on implementation of the rules of origin provided in the ASEAN trade in goods agreement

CIRCULAR

ON IMPLEMENTATION OF THE RULES OF ORIGIN PROVIDED IN THE ASEAN TRADE IN GOODS AGREEMENT

Pursuant to the Governments Decree No.189/2007/ND-CP dated December 27, 2007, defining the functions, tasks, powers and organizational structure of the Ministry of Industry and Trade;

Pursuant to the ASEAN Trade in Goods Agreement signed on February 26, 2009, at the 14th ASEAN Summit in Cha-am, Thailand, between member states of the association of Southeast Asian Nations;

Pursuant to the Government’s Decree No. 19/2006/ND-CP dated February 20, 2006, detailing the Commercial Law regarding origin of goods;

The Ministry of industry and trade prescribes the implementation of the rules of origin provided in the Trade in Goods Agreement as follows:

Chapter I

GENERAL PROVISIONS

Article 1.

Goods eligible for issuance of certificates of origin, form D

A good eligible for issuance of certificates of origin, form D (below referred to as C/O), means an originating good under the provisions of Annex 1 to this Circular for which AC/OIS issued by a form-D C/O issuer.

Article 2.

Interpretation of terms

1. The ASEAN Trade in Goods Agreement (ATIGA) is the one signed on February 26, 2009, at the 14th ASEAN Summit in Cha-am, Thailand, between the member states of the association of Southeast Asian Nations;

2. Vietnamese issuer of C/O, form D (below referred to as C/O issuer), means organizations specified in Annex 13.

3. Applicant for C/O, form D (below referred to as C/O applicant), means exporter, producer or a lawfully authorized representative of an exporter or producer.

4. eCOSys means Vietnam's certificate of origin management and issuance electronic system at http://www.ecosys.gov.vn.

Article 3.

Responsibilities of C/O applicants

C/O applicants shall:

1. Register trader dossiers with C/O issuers under Article 5;

2. Submit C/O application dossiers to C/O issuers;

3. Prove that their exports satisfy all origin requirements and facilitate the verification of the origin of these goods by C/O issuers;

4. Take responsibility before law for the accuracy and truthfulness of their declarations related to C/O application, including cases of authorization by exporters;

5. Promptly report to C/O issuers at which traders have filed C/O applications on C/O issued by Vietnamese C/O issuers which are rejected by importing countries (if any);

6. Facilitate the verification by C/O issuers production establishments or places where exports are raised, grown, harvested and processed;

7. Prove the authenticity of the origin of ported goods at the request of the Ministry of Industry and Trade, C/O issuers or customs offices of Vietnam or importing countries.

Article 4.

Responsibilities of C/O issuers

C/O issuers shall:

1. Give guidance to C/O applicants upon request;

2. Receive and examine trader dossiers and C/O application dossiers;

3. Verify the actual origin of goods when necessary;

4. Issue C/O when goods satisfy the origin requirements in this Circular and C/O applicants observe all provisions of Article 3;

5. Send specimens of signatures of persons authorized to sign C/O and seals of C/O issuers to the Ministry of Industry and Trade (the Import and Export Department) under the Ministry of Industry and Trade's regulations for registration with competent authorities of importing countries;

6. Settle complaints related to C/O issuance according to their competence;

7. Re-verify the origin of exported goods at the request of competent authorities of importing countries;

8. Exchange information relating to the C/O issuance with other C/O issuers;

9. Send reports to, participate in all professional training courses on origin organized by, and respond to other requests under regulations of the Ministry of Industry and Trade.

Chapter II

PROCEDURES FOR C/O ISSUANCE.

Article 5.

Registration of trader dossiers

1. C/O applicants may be considered for C/O issuance only at places where they have registered their trader dossiers and after they have completed trader dossier registration procedures. A trader dossier comprises:

a/ Registration of the specimen of the signature of the person authorized to sign the C/O application and the specimen of seal of the trader (Annex 12, not translated herein);

b/ Business registration certificate of the trader (a certified true copy);

c/ Tax identification number registration certificate (a certified true copy);

d/ List of production establishments (if any) of the trader (Annex 11, not translated herein).

2. Before the C/O application, any change in the trader dossier shall be notified to the C/O issuer with which this dossier has been registered. A trader dossier shall be updated once every two (2) years.

3. In case of a force majeure circumstance or for a plausible reason, if wishing to get a C/O issued by a C/O issuer different from that with which it has registered the trader dossier, a C/O applicant shall provide written plausible reasons for the non-application at the C/O issuer with which it has registered the trader dossier, and register the trader dossier with the new C/O issuer.

Article 6.

C/O application dossiers

1. A C/O application dossier comprises:

a/ The C/O application form (Annex 10, not translated herein), which has been fully and duly filled in as guided in Annex 9 (not translated herein);

b/ The C/O form (Annex 8, not translated herein), which has been fully filled in;

c/ The customs declaration for which customs procedures have been completed. This declaration is not required for exports which are not subject to customs declaration under law;

d/ The commercial invoice;

e) The bill of lading or equivalent document in case the trader has no bill of lading. When a back C/O is issued for the whole goods lot of the goods lot brought from a non-tariff zone into the domestic market, this document may be exempted if the trader does not actually hold it.

Pending the availability of the customs declaration for which customs procedures have been completed and the bill of lading (or any document equivalent to bill of lading), the C/O applicant may submit these documents later within fifteen (15) working days after the date of receipt of C/O.

2. When finding it necessary, the C/O issuer may request the C/O applicant to supply additional documents related to the exports, such as customs declaration of imported materials and auxiliary materials; export permit (if any); purchase and sale contract; value-added invoices on the purchase and sale of domestic materials and auxiliary materials; samples of materials and auxiliary materials or exports; description of the manufacturing process With HS headings of input materials and goods (for change in tariff classification (CTC) criteria or good manufacturing or processing operation criteria); or calculation of the regional value content (RVC) for RVC criteria); and other documents proving the origin of exports.

3. The papers specified at Points c, d and e of Clause 1, and Clause 2, may be copies bearing the signatures and true-copy stamps of traders' representatives at law or authorized persons, together with their originals for comparison at the request of C/O issuers when necessary.

4. For traders joining the eCOSys, their persons authorized to sign C/O applications shall declare data via the eCOSys, give their e-signatures and automatically transmit them to C/O issuers. After examining application dossiers on the eCOSys, if agreeing to issue C/O, C/O issuers shall notify such via the eCOSys to applying traders to submit complete dossiers on paper to C/O issuers for comparison before issuing C/O.

Article 7.

Receipt of C/O application dossiers

When C/O applicants file their dossiers, record officers shall receive and examine these dossiers, then notify C/O applicants in dossier receipts or other written forms of one of the following actions:

1. Issuance of C/O under Article 8;

2. Request for supplementation of documents under Article 6;

3. Refusal to issue C/O when detecting that:

a/ C/O applicants fail to register trader dossiers under Article 5;

b/ C/O application dossiers are inaccurate or incomplete as required in Article 6;

c/ C/O applicants have not yet submitted documents which are allowed to be submitted later under Article 6;

d/ Dossiers contain contradictory details;

e/ C/O application dossiers are filed with offices other than those with which trader dossiers have been registered; or,

f/ C/O declarations are filled in by handwriting, or contain erasures or contents which are unreadable, or printed in multicolor inks;

g/ There are lawful grounds to evidence that goods are non-originating under this Circular or C/O applicants have committed fraudulent or dishonest acts in proving the origin of their goods.

Article 8.

Issuance of C/O

1. A C/O shall be issued within three (3) working days after the C/O applicant files a complete and valid dossier, except cases specified in Clause 2 of this Article.

2. C/O issuers may conduct verification at production establishments if they deem that the dossier examination provides insufficient grounds for C/O issuance or when they detect signs of illegal acts in connection to previously issued C/O. Verifiers of C/O issuers shall make minutes of verification results and request C/O applicants and/or exporters to jointly sign these minutes. In case C/O applicants and/or exporters refuse to sign these minutes, verifiers shall write the reasons for such refusal in the minutes and sign them for certification.

The time limit for issuing or refusing to issue a C/O in this case is five (5) working days after the C/O applicant files a complete dossier.

3. In the course of consideration for C/O issuance, if detecting goods which fail to satisfy origin requirements or C/O application dossiers which are incomplete or invalid, C/OI issuers shall notify such to C/O applicants under Clause 2 or 3 of Article 7.

4. The verification must not impede the delivery of goods or payment by exporters, unless it is due to the fault of exporters.

Article 9.

Withdrawal of issued C/O

C/O issuers may withdraw C/O they have issued in the following cases:

1. Exporters or C/O applicants have forged documents.

2. Issued C/O are not conformable with the origin criteria.

Chapter III

MANAGEMENT OF C/O ISSUANCE

Article 10.

Competence to sign C/O

Only persons who have completed procedures for specimen signature registration with the Ministry of Industry and Trade for forwarding to the ASEAN Secretariat in order to register specimen signatures with competent authorities of importing countries may sign and issue C/O.

Article 11.

Focal point

The Import and Export Department of the Ministry of Industry and Trade shall act as the focal point performing the following jobs:

1. Guiding and inspecting the C/O issuance;

2. Carrying out procedures for registering specimens of signatures of persons competent to sign and issue C/O and specimens of seals of Vietnamese C/O issuers with the ASEAN Secretariat, and forwarding specimens of signatures of persons competent to sign and issue C/O and specimens of seals of C/O issuers of ATIGA member states to the Ministry of Finance (the General Department of Customs);

3. Assisting the Minister of Industry and Trade in settling matters related to the issuance of C/O.

Article 12.

Reporting regime

1. C/O issuers shall update data on C/O issuance on the eCOSys on a dally basis. Information updates must cover all information required to be declared in C/O application dossiers.

2. Before December 31, 2009, C/O issuers which have not yet connected to the eCOSys shall make eCOSys connection with the Department for E-Commerce and Information Technology of the Ministry of Industry and Trade. Pending the completion of eCOSys connection, C/O issuers shall send monthly reports in writing and by e-mail (with data in the Excel format). Reports for a month must be sent to the Ministry of Industry and Trade not later than the 5th day of the subsequent month, based on the date shown in the postmark or the date of sending e-mail and made according to a form provided in Annex 14 (not translated herein).

3. C/O issuers that have violated Clauses 1 and 2 of this Article thrice shall be suspended from issuing C/O and be named on the website of the Ministry of Industry and Trade. After at least 6 months, the Ministry of Industry and Trade will consider empowering C/O issuers suspended from issuing C/O to issue C/O again based on the requests and explanations of these issuers.

Article 13.

Implementation provisions

This Circular takes effect 45 days from the date of its signing and replaces the Minister of Industry and Trade's Decision No. 19/2008/QD-BCT dated July 24, 2008, promulgating the Regulation on issuance of certificates of origin, form D, for enjoyment of preferences under the Agreement on Common Effective Preferential Tariffs (CEPT) for the establishment of the ASEAN Free Trade Area (AFTA).

FOR THE MINISTER OF INDUSTRY AND TRADE

VICE MINISTER

(Signed and sealed)

NGUYEN THANH BIEN

Annex l

RULES OF ORIGIN

(To the Circular on implementation of the rules of origin provided in the ATIGA)

Article 1.

Interpretation of terms

In this Annex, some terms are construed as follows:

1. "Aquaculture" means the farming of aquatic organisms, including fishes, mollusks, crustaceans, other aquatic invertebrates and aquatic plants, from feedstock, such as eggs, fry, fingerlings and larvae, by intervention in the rearing or growth processes to enhance production such as regular stocking, feeding, or protection from predators;

2. "CIF" means the value of the goods imported, and includes the costs of freight and insurance up to the port or place of entry into the country of importation. CIF price shall be determined under article VII of GATT 1994 and the Agreement on the Implementation of Article VII of GATT 1994 as contained in Annex 1A to the WTO Agreement;

3. "FOB" means the free-on-board value of the goods, inclusive of the costs of transport to the port or site of final shipment abroad. FOB price shall be determined under Article VII of GATT 1994 and the Agreement on the Implementation of Article VII of GATT 1994 as contained in Annex 1A to the WTO Agreement;

4. "Generally accepted accounting principles" means the recognized consensus or substantial authoritative support in a Party, with respect to the recording of revenues, expenses, costs, assets and liabilities; the disclosure of information; and the preparation of financial statements. These principles may encompass broad guidelines of general application as well as detailed standards, practices and procedures;

5. "Goods" shall include materials and/or products, which can be wholly obtained or produced in a member state, even if they are intended for later use as materials in another production process. For the purposes of this Annex, the terms "goods" and "products" can be used interchangeably;

6. "Identical and interchangeable materials" means materials being of the same kind and commercial quality, possessing the same technical and physical characteristics, and which once they are incorporated into a complete product cannot be distinguished from one another for origin purposes by virtue of any markings;

7. "Materials" means any matter or substance used or consumed in the production of a good, physically incorporated into a good, or used in the production of another good;

8. "Originating good" or "originating material" means a good or material that qualifies as originating in accordance with this Annex;

9. "Packing materials and containers for transportation and shipment" means the goods used to protect a good during its transportation and shipment, different from those containers or materials used for its retail;

10. "Production" means methods of obtaining a good, including growing, mining, harvesting, raising, breeding, extracting, gathering, collecting, capturing, fishing, trapping, hunting, manufacturing, processing or assembling.

11. "Product specific rules" means rules that specify that the materials have undergone a change in tariff classification or a specific manufacturing or processing operation, or satisfy the regional value content criterion (or ad valorem criterion) or a combination of any of any of these criteria.

Article 2.

Origin criteria

A good imported into the territory of a Member State from another Member State shall be treated as an originating good eligible for tariff incentives if it conforms to any of the following origin requirements:

1. It is wholly obtained or produced in the territory of the exporting Member State as defined in Article 3; or,

2. It is not wholly obtained or produced in the territory of the exporting Member State, provided that it is eligible under Article 4 or 6.

Article 3.

Wholly obtained or produced goods

Goods referred to in Clause 1, Article 2 shall be considered as wholly obtained or produced entirely in the exporting Member State in the following cases:

1. Plants and plant products, including fruits, flowers, vegetables, trees, seaweed, fungi and live plants, grown and harvested, picked or gathered in the exporting Member State;

2. Live animals, including mammals, birds, fish, crustaceans, mollusks, reptiles, bacteria and viruses, born and raised in the exporting member State;

3. Goods obtained from live animals in the exporting Member State;

4. Goods obtained from hunting, trapping, fishing, farming, aquaculture, gathering or capturing conducted in the exporting Member State;

5. Minerals and other naturally occurring substances, not included in Clauses 1 thru 4, extracted or taken from its soil, waters, seabed or beneath its seabed;

6. Products of sea-fishing taken by vessels registered with a Member State and entitled to fly its flag and other products1 taken from the waters, seabed or beneath the seabed outside the territorial waters2 of that Member State, provided that the Member State has the rights to exploit such waters, seabed and beneath the seabed in accordance with international law3;

7. Products of sea-fishing and other marine products taken from the high seas by vessels registered with a Member State and entitled to fly the flag of that Member State;

8. Products processed and/or made on board factory ships registered with a Member State and entitled to fly the flag of that Member State, exclusively from products referred to in Clause 7 of this Article;

9. Articles collected there which can no longer perform their original function nor are capable of being restored or repaired and are fit only for disposal or recovery of parts of raw materials, or for recycling purposes;

1 "Other products" refers to minerals and other naturally occurring substances extracted from the waters, seabed or beneath the seabed outside the territorial waters.

"Other products" refers to minerals and other naturally occurring substances extracted from the waters, seabed or beneath the seabed outside the territorial waters.

2 For products of sea-fishing obtained from outside the territorial waters (e.g., exclusive economic zone), originating status would be conferred to that Member State with whom the vessels used to obtain such products are registered with and whose flag is flown m the said vessel, and provided that the Member State has the rights to exploit it under international law.

For products of sea-fishing obtained from outside the territorial waters (e.g., exclusive economic zone), originating status would be conferred to that Member State with whom the vessels used to obtain such products are registered with and whose flag is flown m the said vessel, and provided that the Member State has the rights to exploit it under international law.

3 In accordance with international law, registration of vessels could only be made in one Member State.

In accordance with international law, registration of vessels could only be made in one Member State.

10. Waste and scrap derived from:

a/ Production in the exporting Member State; or,

b/ Used goods collected in the exporting Member State, provided that such goods are fit only for the recovery of raw materials; and,

11. Goods obtained or produced in the exporting Member State from products referred to in Clauses 1 thru 10 of this Article.

Article 4.

Not wholly obtained or produced goods

1. General origin criteria

a/ Goods referred to in Clause 2, Article 2 shall be regarded as originating in the Member State where the manufacture or processing of these goods has taken place if:

- They have a regional value content (below referred to as "ASEAN value content" or the "regional value content (RVC)") of at least forty per cent (40%) which is calculated using the formula set out in Article 5; or,

- All non-originating materials used for producing the goods have undergone a change in tariff classification (hereinafter referred to as "CTC") at four-digit level (i.e., a change in tariff heading) of the Harmonized System.

b/ Each Member State shall permit the exporter of the good to decide whether to use either of the two criteria "RVC" of at least forty per cent (40%)" or "a change in tariff classification at four-digit 1evei" set out at Point a, Clause 1, when determining the origin of the good.

2. Product specific rules

a/ Notwithstanding Clause 1 of this Article, goods referred to in Annex 2 shall be regarded as originating goods if they satisfy the relevant criteria set out for these goods in Annex 2.

b/ Where a product specific rule provides a choice of criteria RVC, CTC, and a specific manufacturing or processing operation (SP), or a combination of these, each Member State shall permit the exporter of the goods to decide which criterion to use in determining the origin of goods.

c/ Where product specific rules specify a certain RVC, it is required that the RVC is calculated using the formula set out in Article 5.

d/ The CTC and SP criteria are applicable only to non-originating materials.

3. Notwithstanding Clauses 1 and 2 of this Article, a good which is covered by Attachment A or B of the Ministerial Declaration on Trade in Information Technology Products adopted in the Ministerial Conference of the WTO on December 13, 1996, set out as Annex 4, shall be regarded as originating in a Member State if it is assembled from materials indicated in Annex 4.

Article 5.

Formulas for RVC calculation

1. RVC referred to in Article 4 shall be calculated according to either of the following formulas:

a/ Direct formula:

Or.

b/ Indirect formula

2. For the purpose of calculating RVC provided in Clause 1 of this Article:

a/ ASEAN material cost is the CIF value of originating material, parts or goods that are acquired or produced by the producer;

b/ Value of non-originating materials, parts or goods is;

- The CIF value at the time of importation of the goods or importation can be proven; or,

- The earliest ascertained price paid for the goods of undetermined origin in the territory of the Member State where the manufacture or processing takes place;

c/ Direct labor cost includes wages, remuneration and other employee benefits associated with the manufacturing process;

d/ Direct overhead cost includes, but is not limited to, real property items associated with the production process (insurance, factory rent and hire purchase, depreciation on buildings, repair maintenance, taxes, interests on mortgage); hire-purchase of and interest payments for plant and equipment; factory security; insurance (plant, equipment and materials used in the manufacture of the goods); utilities (energy, electricity, water and other utilities directly attributable to the production of the goods); research, development, design and engineering; dies, moulds, tooling and the depreciation, maintenance and repair of plant and equipment; royalties or licenses (in connection with patented machines or processes used in the manufacture of the goods or the right to manufacture the goods); inspection and testing of materials and the goods; storage and handling in the factory; disposal of recyclable wastes; and cost elements in computing the value of raw materials, i.e., port and clearance charges and import duties; and,

e/ FOB price means the free-on-board value of the goods as defined in Article 1. FOB price shall be determined by adding the value of materials, production cost, profit and other costs.

3. Member States shall determine and adhere to only one method of calculating the RVC. Member States shall be given the flexibility to change their calculation method provided that such change is notified to the AFRA Council at least six (6) months prior to the adoption of the new method. Any verification to the RVC calculation by the importing Member State shall be done on the basis of the method used by the exporting Member State.

4. In determining RVC, Member States shall closely adhere to the guidelines for costing methodologies set out in Annex 5.

5. Locally procured materials produced by established licensed manufacturers, in compliance with domestic regulations, shall be deemed to have fulfilled the origin requirement of this Annex; locally procured materials from other sources shall be subjected to the origin verification under the Agreement on Customs Valuation for the purpose of origin determination.

6. The value of goods under this Annex shall be determined under the agreement on Customs Valuation.

7. Vietnam applies the indirect formula provided at Point b, Clause 1 of this Article in determining the origin of exports under the ATIGA.

Article 6.

Accumulation

1. Unless otherwise provided in the ATIGA, goods originating in a Member State, which are used in another Member State as materials for finished goods eligible for preferential tariff treatment, shall be considered to be originating in the latter Member State where manufacture or processing of the goods has taken place.

2. If the RVC of the material is less than forty per cent (40%), it shall be cumulated (using the RVC criterion) to the actual domestic content provided that it is equal to or more than twenty percent (20%). The implementing guidelines are set out in Annex 6.

Article 7.

Minimal operations and processes

1. Operations or processes undertaken, by themselves or in combination with each other for the purposes listed below, are considered to be minimal and shall not be taken into account in determining whether a good has been originating in one Member State:

a/ ensuring preservation of goods in good condition for the purposes of transport or storage;

b/ facilitating shipment or transportation,

c/ packaging or presenting goods sale.

2. A good originating in the territory of a Member State shall retain its initial originating status, when exported from another Member State, where minimal operations or processes referred to in Clause 1 of this Article have been undertaken.

Article 8.

Direct consignment

1. Preferential tariff treatment shall be applied to goods satisfying the requirements of this Annex and which are consigned directly between the territories of the exporting Member State and the importing Member State.

2. The following shall be considered as directly consigned:

a/ goods transported from an exporting Member State to the importing Member State; or,

b/ goods transported through one or more Member State, other than the exporting Member State and the importing Member State, or through a non-member State, provided that:

- The transit entry is justified for geographical reason or by consideration related exclusively to transport requirements;

- The goods have not entered into trade or consumption there; and,

- The goods have not undergone any operation there other than unloading and reloading or any other operation required to preserve them in good condition.

Article 9.

De Minimis

1. A good that does not undergo a change in tariff classification shall be considered as originating if the value of all non-originating materials used in its production that do not undergo the required change in tariff classification does not exceed ten percent (10%) of the FOB value of the good and the good meets all other requirements set forth in this Annex.

2. The value of non-originating materials referred to in Clause 1 of this Article shall, however, be included in the value of non-originating materials for any applicable RVC requirement for the good.

Article 10.

Packages and packing materials

1. Packaging and packing materials for retail:

a/ If a good is subject to the RVC criterion, the value of the packaging and packing materials for retail shall be considered to be forming a whole with the good and taken into account in its origin assessment.

b/ When Point a, Clause 1 of this Article is not applicable, the packaging and packing materials for retail, when classified together with the packaged good shall not be taken into account in considering whether all non-originating materials used in the manufacture of a product fulfils the CTC criterion.

2. The containers and packing materials exclusively used for the transport of a good shall not be taken into account for determining the origin of the said good.

Article 11.

Accessories, spare parts and tools

1. If a good is subject to the CTC- or SP-based rule of origin, the origin of accessories, spare parts, tools and instructional or other information materials presented with the good shall not be taken into account in determining whether the good qualifies as an originating good, provided that:

a/ The accessories, spare parts, tools and instructional or other information materials are not invoiced separately from the good; and,

b/ The quantities and value of the accessories, spare parts, tools and instructional or other information materials are customary for the good.

2. If a good is subject to the RVC-based rule of origin, the value of the accessories, spare parts, tools and instructional or other information materials shall be taken into account as the value of the originating or non-originating materials, as the case may be.

Article 12.

Neutral elements

In order to determine whether a good originates, it shall not be necessary to determine the origin of the following which might be used in its production and not incorporated into the good:

1. fuel and energy;

2. tools, dies and moulds;

3. spare parts and materials used in the maintenance of equipment and buildings;

4. lubricants, greases, compounding materials and other materials used in production or used to operate equipment and buildings;

5. gloves, glasses, footwear, clothing and safety equipment;

6. equipment, devices and machines used for testing or inspecting the good;

7. catalyst and solvent;

8. any other goods that are not incorporated into the good but of which use in the production of the good can reasonably be demonstrated to be a part of that production.

Article 13.

Identical and interchangeable materials

1. The determination of whether identical and interchangeable materials are originating shall be made either by physical segregation of each of the materials or by the use of generally accepted accounting principles of stock control applicable or inventory management practiced in the exporting Member State.

2. Once a decision has been taken on the inventory management method, that method shall be used throughout the fiscal year.

Article 14.

C/O

To be accepted as eligible for preferential tariff treatment, a good must have a certificate of origin as set out in Annex 8 issued by a government authority designated by the exporting Member State and notified to the other Member States in accordance with Annex 7.

Annex 7

PROCEDURES FOR ISSUANCE AND VERIFICATION OF C/O

(To the Circular on implementation of the rules of origin provided in the ATIGA)

Article 1.

Definitions

1. "Back-to-back C/O" means a C/O issued by an intermediate exporting Member State based on the C/O issued by the first exporting Member State;

2. "Exporter" means a natural or legal person located in the territory of a Member State where a good is exported from by such person;

3. "Importer" means a natural or legal person located in the territory of a Member State where a good is imported into by such person;

4. "CO issuer" means an organization authorized by the Government of the exporting Member State to issue C/O and notified to all the other Member States in accordance with this Annex; and,

5. "Producer" means a natural or legal person who carries out production in the territory of a State Member as set out in Article 1 of Annex 1.

Article 2.

Specimens of signatures and seals of C/O issuers

1. Each Member State shall provide a list of the names, addresses, specimens of signatures and specimens of seals of its C/O issuers, in hard copy and soft copy formats, to the ASEAN Secretariat for dissemination to other Member States in son copy formats. Any change in the said list shall be prompt/y provided in the same manner.

2. The specimens of signatures and seals of C/O issuers shall be updated annually by the ASEAN Secretariat. Any C/O issued by an official not named in the list referred to in Clause 1 shall not be honored by the importing Member State.

Article 3.

Supporting documentary evidence

For the purpose of determining originating status, C/O issuers may request supporting documentary evidence or carry out checks considered appropriate in accordance with relevant regulations of a Member State.

Article 4.

Pre-exportation examination

1. The producer or exporter of the good or its authorized representative filing an application with the C/O issuer shall request the latter to conduct pre-exportation examination of the origin of the good in accordance with the Member State's regulations. The result of the examination, subject to review periodically or whenever appropriate, shall be accepted as the supporting evidence in determining the origin of the said to be exported thereafter. This examination may not apply to the good of which, by its nature, origin can be easily determined.

2. For locally procured materials, self-declaration by the final manufacturer shall be used as a valid document when applying for the issuance of a C/O.

Article 5.

Submission of C/O applications

At the time of carrying out the formalities for exporting the goods under preferential treatment, the exporter or his authorized representative shall submit a written application for a C/O together with appropriate supporting documents proving that the goods to be exported qualify for the issuance of a C/O.

Article 6.

Examination of C/O application dossiers

The C/O issuer shall carry out proper examination, in accordance with the domestic laws of its country, upon each application for a C/O to ensure that:

1. The application and the C/O are duly completed and signed by the authorized signatory;

2. The origin of the good is in conformity with the rules provided in Annex 1;

3. The other statements of the C/O correspond to supporting documentary evidence submitted;

4. Description, quantity and weight of goods, marks and number of packages, number and kinds of packages, as specified, conform to the goods to be exported;

5. Multiple items declared on the same C/O shall be allowed, provided that each item qualifies relevant applicable rules of origin.

Article 7.

C/O

1. A C/O must be on A4-size white paper in conformity to the specimen shown in Annex 8 (not translated herein). It shall be made in English.

2. A C/O set comprises one original and two carbon copies.

3. Each CIO bears a reference number separately given by each C/O issuer.

4. Each C/O bears the handwritten signature and the seal of the C/O issuer.

5. The original copy shall be forwarded by the exporter to the importer for submission to the customs office of the importing Member State at the port or place of importation. The duplicate shall be retained by the C/O issuer in the exporting Member State. The triplicate shall be retained by the exporter.

Article 8.

Indication of origin criterion

To implement the provisions of Article 2 of Annex 1, a C/O issued by the final exporting Member State must indicate the relevant applicable origin criterion in box 8.

Article 9.

Handling of errors on C/O

Neither erasures nor superimpositions shall be allowed on a C/O. Any alteration shall be made by:

1. Striking out the erroneous materials and making any addition required. Such alterations shall be approved by an official authorized to sign the C/O and certified by the C/O issuer. Unused spaces shall be crossed out to prevent any subsequent addition; or,

2. Issuing anew C/O to replace the erroneous one.

Article 10.

Issuance of C/O

1. C/O shall be issued at the time of exportation or soon thereafter, if, under the rules of origin provided in Annex 1, the goods to be exported can be considered originating in the exporting Member State.

2. In exceptional cases in which a C/O has not been issued at the time of exportation or no later than three (3) days from the date of exportation, due to unintentional errors or omissions or other valid causes, the C/O may be issued retroactively but no longer than one (1) year from the date of shipment and shall be marked in the "Issued Retroactively" box.

Article 11.

Back-to-back C/O

The C/O issuer of the intermediate Member State may issue a back-to-back C/O if an application is made by the exporter, provided that:

1. A valid original C/O is presented by the applicant. In the case in which no original C/O is presented, its certified true copy shall be presented by the applicant;

2. The back-to-back C/O issued must contain some of the same information as the original C/O. In particular, every box in the back-to-back C/O must be completed. FOB price of the intermediate Member State in box 9 must also be shown on the back-to-back C/O;

3. For partial export shipments, the partial export value shall be shown instead of the full value of the original C/O. The intermediate Member State shall ensure that the total quantity re-exported under the partial shipment does not exceed the total quantity of the original C/O from the first Member State when approving the back-to-back C/O to the exporter;

4. In case the information is not complete and or circumvention is suspected, the customs office of the final importing Member State may request that the original C/O be submitted by the final importer;

5. Verification procedures set out in Articles 18 and 19 are also applied to Member State issuing the back-to-back C/O.

Article 12.

Loss of C/O

In case of the theft, loss or destruction of a C/O, the exporter may apply in writing to the C/O issuer for a certified true copy of the original to be made out on the basis of the export documents in its possession bearing the words "CERTIFIED

TRUE COPY" in box 12. This copy shall bear the date of issuance of the original C/O. The certified copy shall be issued no longer than one year from the date of issuance of the original C/O.

Article 13.

Submission of C/O

1. For the purpose of claiming preferential tariff treatment, the importer shall submit to the customs office of the importing Member State at the time of import a declaration and the C/O enclosed with supporting documents (i.e., commercial invoices and the through Bill of Lading issued in the territory of the exporting Member State upon request) and other documents as required by the domestic laws of the importing Member State.

2. In case a C/O is rejected by the customs office of the importing Member State, the subject C/O shall be marked accordingly in box 4 and returned to the C/O issuer within a reasonable period not exceeding sixty (60) days. The C/O issuer shall be duly notified by the customs office of the importing Member State of the grounds for the denial of preferential tariff treatment.

3. In case a C/O is rejected as stated in Clause 2, the customs office of the importing Member State may consider the clarifications made by the C/O issuer to decide whether it can accept the C/O and reinstate the preferential tariff treatment. The C/O issuer's clarifications should be detailed and exhaustive in addressing the grounds for denial of preferential tariff treatment raised by the importing Member State.

Article 14.

Validity of C/O

The time limit for the presentation of a C/O is prescribed below:

1. The C/O must be submitted to the customs office of the importing Member State within twelve (12) months from the date of issuance.

2. In case the C/O is submitted to the customs office of the importing Member State after the expiration of the time limit specified in Clause 1, such C/O is still to be accepted when failure to observe the time limit results from force majeure or other plausible causes beyond the control of the exporter; and,

3. In all cases, the customs office of the importing Member State may accept such C/O provided that the products have been imported before the expiration of the validity of the said

C/O.

Article 15.

Waiver of C/O

In the case of consignments of goods originating in the exporting Member State and not exceeding US$ 200 (two hundred) FOB, the production of C/O shall be waived and the use of simplified declaration by the exporter that the goods in question have originated in the exporting Member State will be accepted. Goods sent by post not exceeding US$ 200 FOB shall also be similarly treated.

Article 16.

Handling of minor discrepancies

1. Where the origin of the good is not in doubt, the discovery of minor discrepancies, printed errors in the statements made in the C/O and those made in the documents submitted to the customs office of the importing Member State for the purpose of carrying out the import formalities shall not ipso-facto invalidate the C/O, if it does in fact correspond to the products actually imported.

2. In case the exporting Member State and importing Member State have different HS tariff classifications for a good subject to preferential tariffs the imported goods shall be released at the MFN or a higher rate, depending on the rules of origin currently in force, and no penalty or other charges shall be imposed on the exporter in accordance with the domestic laws of the importing Member State. Once the classification differences have been resolved, the correct preferential rate shall be applied and any overpaid duty shall be refunded, in accordance with the domestic laws of the importing Member State, after the issue has been resolved.

3. For multiple items declared under the same C/O, a problem encountered with one of the items listed will not affect or delay the grant of preferential tariff treatment and customs clearance of the remaining items listed in the C/O. Clause 3 of Article 18 may be applied to the problematic items.

Article 17.

Record keeping

1. For the purposes of the verification process pursuant to Articles 18 and 19, the producer and/or exporter applying for a C/O shall, subject to the domestic laws of the exporting Member State, keep its supporting records for application for three (3) years from the date of issuance of the C/O.

2. The application for C/O and all documents related to such application shall be retained by the C/O issuer for three (3) years from the date of issuance.

3. Information relating to the validity of the C/O shall be furnished upon request of the importing Member State by an official authorized to sign the C/O and certified by competent Government authorities.

4. Any information communication between the Member States concerned shall be treated as confidential and shall be used for the C/O validation purpose only.

Article 18.

Retroactive check

The importing Member State may request the C/O issuer of the exporting Member State to conduct a retroactive check at random and/or when it has reasonable doubt as to the authenticity of the document or as to the accuracy of the information regarding the true origin of the products in question or of certain parts thereof. Upon such request, the C/O issuer of the exporting Member State conduct a retroactive check on a producer/exporter’s cost statement based on the current cost and prices, within six (6) months from the date of exportation, subject to the following conditions:

1. The request for retroactive check shall be accompanied with the C/O concerned and shall specify the reasons and any additional information suggesting that the particulars given on the sail C/O may be inaccurate, unless the retroactive check is requested on a random basis;

2. The C/O issuer receiving a request for retroactive check shall respond to the request promptly and reply within ninety (90) days after the receipt of the request;

3. The customs office of the importing Member State may suspend the grant of preferential tariff treatment while awaiting the result of verification. However, it may release the goods to the importer subject to any administrative measures deemed necessary, provided that they are not subject to import prohibition or restriction and there is no suspicion of fraud;

4. The C/O issuer shall promptly transmit the results of the verification process to the importing Member State which shall then determine whether or not the subject good is originating. The entire process of retroactive check including the process of notifying the C/O issuer of the exporting Member State of the result of determination whether or not the good is originating shall be completed within one hundred eighty (180) days. While awaiting the results of the retroactive check, Clause 3 of this Article shall be applied.

Article 19.

Verification visits

If the importing Member State is not satisfied with the outcome of the retroactive check stated in Article 18, it may, in certain cases, request verification visits to the exporting Member State.

1. Prior to a verification visit to the exporting Member State, an importing Member State shall:

a/ Deliver a written notification of its intention to conduct the verification visit to:

- The exporter or producer whose premises are to be visited;

- The C/O issuer of the exporting Member State in whose territory the verification visit is to occur;

- The customs office of the Member State in whose territory the verification visit is to occur;

- The importer of the good subject of the verification visit.

b/ The written notification mentioned at Point a, Clause 1 of this Article must be as comprehensive as possible including, among others:

- The name of the customs office issuing the notification;

- The name of the exporter or producer whose premises are to be visited;

The proposed date for the verification visit;

- The coverage of the proposed verification visit, including reference to the good subject of the verification;

- The names and titles of the officials performing the verification visit;

c/ Obtain the written consent of the exporter or producer whose premises are to be visited.

2. When a written consent from the exporter or producer is not obtained within thirty (30) days upon receipt of the notification pursuant to Point a, Clause 1 of this Article, the importing Member State may deny preferential treatment to the product that would have been subject of the verification visit.

3. The C/O issuer receiving the notification may propose postponement of the proposed verification visit and notify the importing Member State of such postponement. Notwithstanding any postponement, any verification visit shall be carried out within sixty days (60) days from the date of such receipt, or for a longer period as the concerned Member States may agree.

4. The Member State conducting the verification visit shall provide the exporter or producer whose product is the subject of the verification and the relevant C/O issuer with a written determination of whether or not the subject product qualifies as an originating product.

5. Any suspended preferential treatment shall be reinstated upon the written determination referred to in Clause 4 of this Article that the good qualifies as an originating good.

6. The exporter or producer will be allowed thirty (30) days, from receipt of the written determination, to provide in writing comments or additional information regarding the eligibility of the product. If the product is still found to be non-originating the final written determination will be communicated to the C/O issue within thirty (30) days from receipt of the comments or additional information from the exporter or producer.

7. The verification visit process, including the actual visit and determination of whether the subject product is originating or not, shall carried out and its results communicated to the C/O issuer within a maximum of 180 days. While awaiting the results of the verification visit, Clause 3 of article 18 shall be applied.

Article 20.

Confidentiality

Member States shall maintain, in accordance with their domestic laws, the confidentiality of classified business information collected in the process of verification under Article 18 and 19 and shall protect that information from disclosure that could prejudice the competitive position of the person who provided the information. The classified business information may only be disclosed to those authorities responsible for the administration and enforcement of origin determination.

Article 21.

Documents required for direct transportation

For the purpose of implementing Point b, Clause 2, Article 8 of Annex 1, when transportation is effected through the territory of one or more intermediate non-Member State, the following shall be produced to the customs office of the importing Member State:

1. A through bill of lading issued in the exporting Member State;

2. AC/O issued by the relevant C/O issuer of the exporting Member State;

3. A copy of the commercial invoice; and,

4. Supporting documents proving that the requirements of direct transportation are complied with.

Article 22.

Goods for exhibition

1. Products sent from an exporting Member State for exhibition in another Member State and sold during or after the exhibition for importation into a Member State may benefit from tariff preferential treatment under the ATIGA on the condition that the products meet the requirements of the Rules of origin in Annex 1 provided that it is shown to the satisfaction of the customs office of the importing Member State that:

a/ An exporter has dispatched those products from the territory of the exporting Member State to the Member State where the exhibition is held and has exhibited them there;

b/ The exporter has sold the goods or transferred them to a consignee in the importing Member State;

c/ The goods have been consigned during the exhibition or immediately thereafter to the importing Member State in the state in which they were sent for the exhibition.

2. For the purpose of implementing the provisions of Clause 1 above, the C/O must be produced to competent authorities of the importing Member State. The name and address of the exhibition must be indicated. The competent authorities of the Member State where the exhibition took place may provide evidence together with supporting documents prescribed in Clause 4 of Article 21 for the identification of the products and the conditions under which they were exhibited.

3. Clause1/ of this Article applies to any trade, agricultural or crafts exhibition, fair or similar show or display in shops or business premises with the view to the sale of foreign products and where the products remain under customs control during the exhibition.

Article 23.

Invoices issued by third countries

1. Relevant customs offices in the importing Member State shall accept C/O in cases in which the sales invoice is issued either by a company located in anon-Member State or by an ASEAN exporter for the account of the said company, provided that the good meets the origin requirements set out in Annex 1.

2. The exporter shall mark the "Third country invoicing" box and indicate such information as name and country of the invoice issuer on the C/O.

Annex 13

LIST OF C/O ISSUERS

(To the Circular on implementation of the rules of origin provided in the ATIGA)