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Latin America

Summary:

Agreements with Mexico and Chile.

Mexico

a) General introduction

The trade part of the EU - Mexico Economic Partnership, Political Co-ordination and Cooperation Agreement entered into force on 1 July 2000 .

Preferential rules of origin are set out in Annex III to Decision N° 2/2000 of the EU-Mexico Joint Council and they are similar to other sets of preferential origin rules included in other Agreements concluded by the Community. Nevertheless, a few specific features do differ and therefore merit being highlighted.

b) Legal framework

Annex III and its Appendixes have been published in the OJ L 245 of 29.09.2000 , p. 953.

A Communication to traders on the "Implementation of the rules of origin under the EC - Mexico Agreement" has been published in the OJ C 187 of 6.7.2000, p. 3.

'List rules' have been adapted to the modifications in the classification of goods introduced by the 2002 Harmonized System. Joint Council Decision No 5/2002 (OJ L 44 of 18.2.2003, p. 1) contains the "new" Appendix II (together with a few other provisions) which has been republished in its entirety.

Annex III has been amended to take account of the 2004 EU enlargement by Joint Council Decision No 3/2004 (OJ L 293 of 16.9.2004, p. 15). Amendments related to the 2007 EU enlargement were introduced by Joint Council Decision No 2/2008 (OJ L 198, 26.7.2008 p.55).

Decision No 1/2007 of the EU-Mexico Joint Committee (OJ L 279 of 23.10.2007, p. 15) introduced certain amendments to the rules of origin contained in Annex III, which concern the following:

  • Extension of the temporary application of two 'list rules' set out in Appendix II(a) and relating to certain chemical products, until 30 June 2009;
  • Extension of the temporary application of a 'list rule' set out in Appendix II(a) and relating to leather products, until conclusion of the current WTO negotiations;
  • Change of the management method used to allocate annual quotas set out in Appendix II for textiles exported from the Community to Mexico, from an auction system to a 'first come, first served' basis;
  • Change of the management method used to allocate annual quotas set out in Appendix II(a) for footwear exported from the Community to Mexico, from an auction system to a 'first come, first served' basis;
  • Change of the rule of origin set out in Appendix II for products classified in HS heading 1904;
  • Change of the rule of origin set out in Appendix II for products classified in HS heading 7601.

Explanatory Notes to Annex III have been published in OJ C 128 of 28.4.2001, p. 9. Additionally, the Explanatory Note to Article 17 has been amended and its revised text has been published in the OJ C 40 of 14.2.2004, p. 2.

c) Specific provisions

NOTICE: These specific provisions only contain information on cases where the rules of the particular arrangement differ from the common provisions, or where these common provisions need to be complemented. Therefore, always check the common provisions too.

Minimal operations

A few items contained in the list of insufficient working or processing - i.e. minimal operations - are specific to this Agreement. It is therefore necessary to consult Article 6 of Annex III.

General tolerance rule

The general tolerance rule is set out in Article 5 and it is limited to 10% of the ex-works price of the product.

Specific tolerance rule for textile products

It should be noted that the specific tolerance rule on non-originating basic textile materials set out in Note 5.1 to Appendix I, is limited to 8% of the total weight of all basic textile materials used in the manufacture of the product to be exported.

Proof of origin

  • a movement certificate EUR.1 or
  • an 'invoice declaration' made out by an approved exporter, or by any exporter provided that the total value of the products does not exceed € 6 000.

A specific requirement introduced in this Agreement is the compulsory indication of the 4-digit tariff classification of the goods exported, included in box 8 of the movement certificate EUR.1.

It is advisable to consult the Explanatory Notes to Annex III (including the revised Explanatory Note to Article 17) for details on completion or making out of proofs of origin.

Movement certificates EUR.1 are issued in Mexico by the 'Secretaría de Economía' (Ministry of Economy), which is also responsible for granting, monitoring and withdrawing authorisations to 'approved exporters'. Post-verification checks following a request introduced by a customs authority in the Community is also the responsibility of the 'Secretaría de Economía'.

On the other hand it is the customs authority in Mexico that has the competence to request customs authorities in the Community to verify the originating status of the goods or the authenticity of the proof of origin.

Period of validity of proofs of origin

The validity of proofs of origin is 10 months.

Exemptions from the requirement to present proof of origin

No proof of origin is required when the total value of the imported products does not exceed € 500 in the case of small packages or € 1 200 in the case of products forming part of travellers' personal luggage.

Exhibitions

The Agreement does not provide for preferential treatment to goods exhibited in a third country and subsequently sold to an importer of one of the two Parties.

"List rules"

A few "list rules" are included in Appendix II (a) and they are applicable on a temporary basis instead of the "list rules" set out in Appendix II.

Chile

Legal framework

The Association Agreement between the EU and Chile (OJ L 352, 30.12.2002) entered into force on 1 March 2005. The trade part of the Agreement applied from 1 February 2003.

The applicable preferential rules of origin are set out in Annex III to the Association Agreement (p. 935 in the same OJ), as amended by the 2004 Accession Protocol to the Agreement (OJ L 38, 10.2.2005, p. 3) concluded between the EU and Chile to take account of the accession of 10 new EU Member States from 1 May 2004. The list rules are contained in Appendix II to Annex III.

Explanatory Notes to Annex III have been published in 2003 (OJ C 321, 31.12.2003, p. 22) and revised in 2005 ( OJ C 56 , 5.3.2005, p. 36).

Specific provisions

NOTICE: These specific provisions only contain information on cases where the rules of the particular arrangement differ from the common provisions, or where these common provisions need to be complemented. Therefore, always check the common provisions too.

Cumulation

Bilateral cumulation applies to materials originating in each of the parties (Article 3).

General tolerance rule

The level of the general tolerance for non-textile products is set at 10% (Article 5).

Minimal operations

The list of minimal operations is contained in Article 6. One of the listed operations is specific to this Agreement [(o) operations whose sole purpose is to ease loading].

"No drawback" rule

A general prohibition of drawback will apply from 1 January 2007.

Proof of origin

Originating products can benefit from preferential treatment at import into the Community or in Chile upon submission of either a movement certificate EUR.1 or an invoice declaration (Article 15).

Specific provisions on issuing EUR.1 certificates are contained in Articles 16 to 19. Appendix III includes a specimen of a EUR.1 certificate and gives indications for its completion.

The invoice declaration can be made out by any exporter for goods whose total value does not exceed € 6 000 or by an approved exporter if that value is exceeded (Articles 20 and 21). Appendix IV gives indications for making out an invoice declaration.

The explanatory notes contain further practical details concerning proofs of origin.

The period of validity of any proof or origin is 10 months.

Movement certificates EUR.1 are issued in Chile by the Dirección General de Relaciones Económicas Internacionales (DIRECON) of the Ministry of Foreign Affairs, as well as its local offices of 'ProChile'. DIRECON is also responsible for granting, monitoring and withdrawing authorisations to 'approved exporters'. Post-verification checks following a request introduced by a customs authority in the Community is also the responsibility of DIRECON.

On the other hand it is the customs authority in Chile that has the competence to request customs authorities in the Community to verify the originating status of the goods or the authenticity of the proof of origin.