The issue of customs preferences and the related statement of preferential origin has been newly reconceived after the accession of the Czech Republic to the EU. Having received numerous questions on this topic, we have decided to provide a short summary of the legal requirements and an overview of the procedure used by Ferona, a.s.
1.1 Origin of Goods
The rules pertaining to the origin of products and goods are closely connected to customs. In the EU there is a wide range of customs tariffs, including preferential customs, which represent more favorable conditions than other customs rates.
This issue is regulated by many bilateral treaties concluded by the EU and individual member states or groups of member states or by unilateral measures adopted by the EU in relation to the selected countries. The treaties stipulate the rules which lead to the determination of the country of origin of the relevant goods and products, using precise definitions pertaining to individual chapters of the Harmonized System of Product Classification.
The purpose of this system is to differentiate between the destination and origin of the product concerned so as to ascertain whether the exported goods are entitled to preferential custom rates or not.
1.2 Preferential EU Treaties and Unilateral EU Preferential Measures
EU has concluded preferential treaties or granted unilateral preferential conditions to virtually all countries in the world, except for the USA, Canada, Australia, New Zealand, Japan, Korea, Taiwan, Hong Kong and Singapore. Products imported from these countries are deemed to be of non-preferential origin and not covered by preferential customs rates.
1.3 Use of Origin Rules
All EU preferential treaties and unilateral EU measures (as stipulated in Commission Regulation 2454/93/EEC, implementary regulation to the EU Customs Code as amended by Commission Regulation 1602/2000/ EC), contain detailed rules to determine the country of a product’s origin, as well as to define the adequate and inadequate processing and treatment of goods. The annexes thereto contain an overview of the products sorted in accordance with the Harmonized System, including the specific processing and treatment methods required to obtain the preferential status.
2.1 Regulations Pertaining to Proof of Origin
Accession to the EU has introduced the obligation to comply with Council Regulation 1207/2001 /EC and (Annexes I – IV thereof).
There are two common methods used to establish the origin of goods and products, i.e. either by a manufacturer’s/supplier’s declaration or by the EUR.1 form.
To use the aforesaid forms, the supplier must have ‘approved exporter’ status, which allows it to use the simplified customs procedures during export.
Ferona is an approved exporter, which allows the company to use simple written declarations and statements. Ferona’s approved exporter license number is 07/0346/01.
2.2 Manufacturer’s/Supplier’s Declaration
In this document a manufacturer or a supplier declares that the goods that it sells to its customers come from the declared country of origin. The declaration can be written on the invoice or delivery note or can be executed as a separate document. The declaration can even be issued after the delivery of the products concerned.
There are three main criteria pertaining to the declaration, namely whether the declaration refers to products of preferential or non-preferential origin, whether it is a one-off or long-term declaration and whether the declaration applies to products sold within the EU or exported from the EU.
2.3 EUR.1 Forms
EUR.1 is a form executed by the applicable customs office on the grounds of the supplier’s written application on a prescribed form. The EUR.1 and the application form are unified and have been included in all EU preferential treaties.
EU preferential treaties stipulate the exact conditions for the use of the EUR.1 form. In Tunisia and Morocco the document serves as the only document of origin, since the countries do not allow the use of a written supplier’s declaration. The form is also used in trade with countries that have not concluded preferential treaties with the EU (see 1.2).
To comply with Council Regulation (EC) 1207/2001, Ferona had to draft the necessary methodology, including an SW application that would provide Ferona’s customers with proof of origin. Due to a large number of customers and our huge product assortment, we prefer issuing one-off declarations of origin in our invoices. The creation of long-term declarations, as our customers often require, is virtually impossible on a long-term basis, since we cannot guarantee that the products from our sub-suppliers will always come from the same country of origin. We hope that you will understand the complications involved and that this fact will not affect you business decisions.
We would also like to ask you to submit your requests for proof of origin together with your order. We can provide you with supplementary proof of origin even retroactively, but it is much more laborious for us, as we have to trace all relevant documentation without the assistance of the specialized SW.
3.1 Responsibility for Declaration during Sale
In the event of declarations which apply both to sales within the EU and sales outside the EU, the laws do not stipulate the obligation to have such declarations signed by the company’s authorized representatives, which means that the declarations can be signed by individual sales representatives.
Pursuant to Council Regulation (EC) 1207/2001: ‘where the invoice and supplier's declaration are executed by computer, the declaration need not be signed in manuscript provided that the supplier gives the client a written undertaking accepting complete responsibility for every supplier's declaration which identifies it as if the declaration had been signed in manuscript by the supplier.’ Ferona does not sign one-off declarations in the invoice and confirms its obligations in the purchase contract instead, as follows:
‘Ferona hereby assumes complete liability for each declaration of origin, with the printed name of the company attached, as if the declaration had been signed in manuscript by the company’s authorized representative. This undertaking has been performed in compliance with Council Regulation (EC) 1207/2001, Section 5, Subsection 3.’
3.2 One-off declaration of the origin of goods sold in the Czech Republic and within the EU
If the customer requires proof of origin, the sales representative will have the invoice printed with the following text included:
DECLARATION
I, the undersigned, declare that the goods mentioned in this document were originally in the country cited with individual items in the “Country of Origin” field, and that they satisfy the rules of origin, which govern preferential trade withIS, LI, NO, CH, HR, MK, XC, XL, FO, CL, MX, IL, PS, ACP, OCT, TN, DZ, MA, EG, JO, LB, SY, AL, BA, XK, XM, XS, GSP, AD, ZA, TR.
I hereby undertake to submit all required documents to the customs authorities.
If the customer requests proof of origin to be provided by Ferona as a part of the contractual performance, the sales representative will have the contract printed with the following text included:
‘The customer requests proof of origin.’
3.3 One-off declaration of the origin of goods for export (Ferona exporting the goods outside the EU)
Furthermore, the SW application will automatically print the following declaration in the invoice section titled ‘Further Provisions’:
The exporter of products listed herein (license number CZ/07/0041/05) hereby declares that the specified product(s) come(s) from the countries of origin entered above in the
’country of origin’ column.
Ferona, a.s. is aware of its obligations (as a supplier of metallurgical material, secondary metallurgical products and non-ferrous metals) pursuant to the Regulation of the European Parliament and of the Council (EC) No. 1907/2006 (REACH) concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals.
The way, how we fill the obligations under the REACH, you can find in this letter„Performing the obligations pursuant to the Regulation of the European Parliament and of the Council (EC) No. 1907/2006 (REACH) concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals”.