Trade and Development
Reform on the GSP Rules of Origin
General System of Preferences (GSP)
The principle of GSP was agreed at the United Nations Conference on Trade and Development (UNCTAD), and is a facility granted to developing countries ("beneficiary countries") by certain developed countries ("donor countries"). It is not negotiated with them: the preferential treatment is non-reciprocal.
The GSP schemes offered by the various donor countries and their rules of origin differ fundamentally. Goods complying with the conditions of the GSP of the USA, for example, will not necessarily comply with the GSP of the EC.
Special arrangements have been established in order to address the special needs of the least developed countries. Following the so-called "Everything But Arms" (EBA) initiative introduced in 2001, the EC GSP grants these countries duty- and quota-free access for almost all their exports.
More detailed information on general aspects of the GSP and its background, see the GSP pages of DG Trade.
Exporters in developing countries may also be interested to see the Expanding Exports Helpdesk of DG Trade.
For more detailed information on the rules of origin aspect, see The European Community's rules of origin for the GSP: A Guide for traders.
Not all countries listed as beneficiaries may actually qualify. Myanmar for example is temporarily suspended from GSP, while some other countries have not yet complied with the administrative cooperation requirements, which are a pre-condition for goods to be granted the benefit of the preference. If in doubt, your competent customs authorities will advise.
GSP rules of origin are contained in Articles 66 to 97 and Annexes 14 to 18 and 21 Reg. 2454/93 (IPC) (as amended by Regulations (EC) Nos. 12/97, 1602/2000 and 881/2003). The list rules are contained in Annex 15 CCIP (as amended by Regulation No. 881/2003).
The EU adopted a regulation on 22 July 2008 applying a new GSP scheme for the period from 1 January 2009 to 31 December 2011.
Although reform of the GSP rules of origin is in hand, it was not possible to implement this at the same time as the new GSP scheme. Therefore the present rules will continue to apply for an initial period.
The Reform - New developments
The future of rules of origin
On 18 December 2003, the European Commission opened, through a Green Paper on the future of rules of origin in preferential trade arrangements, a wide-ranging debate on the rules of origin applied to preferential trade arrangements. A summary report of the result has been published and DG Taxation and Customs Union, DG Enterprise and Industry and other Commission services are now working on the follow-up.
Pan-Euro-Mediterranean cumulation of origin refers to the project launched by the Euromed Trade Ministers to extend the system of pan-European cumulation of origin to all Mediterranean partners (Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, Syria, Tunisia and West Bank and Gaza Strip). This system will also be extended to the Faroe Islands. The project is aimed at reinvigorating the trade chapter of the Barcelona process.
A "pan-Euro-Mediterranean" protocol on rules of origin was developed during a working group with all partner countries concerned. This protocol was endorsed by the Euro-Med Trade Ministerial meeting in Palermo on 7 July 2003.
The next step is the replacement of the current protocols on rules of origin by the "pan-Euro-Mediterranean" protocol, both in the agreements of the Community with each of the partner countries, and in the agreements between the partner countries.
Once the protocols on rules of origin have been amended, pan-Euro-Mediterranean cumulation can be applied between three countries as soon as Free Trade Agreements (FTA) containing identical rules of origin between the countries concerned are in place. The system can thus be applied between a limited group of countries, without the full network of FTAs having been completed (so-called 'variable geometry').