What is the De Minimis in the rules of origin under the ASEAN-Japan Comprehensive Economic Partnership Agreement in Vietnam?
- What is the De Minimis in the rules of origin under the ASEAN-Japan Comprehensive Economic Partnership Agreement in Vietnam?
- What are the regulations on manufacturing or processing operation in the rules of origin under the ASEAN-Japan Comprehensive Economic Partnership Agreement in Vietnam?
- What is the formula for calculation of regional value content in the rules of origin under the ASEAN-Japan Comprehensive Economic Partnership Agreement in Vietnam?
What is the De Minimis in the rules of origin under the ASEAN-Japan Comprehensive Economic Partnership Agreement in Vietnam?
In Article 9 of Circular No. 37/2022/TT-BCTT, De Minimis in the rules of origin under the ASEAN-Japan Comprehensive Economic Partnership Agreement is prescribed as follows:
- A good that does not satisfy the requirements of Point b Clause 1 Article 7 or an applicable CTC-based rule of origin set out in Annex I enclosed herewith shall be considered as an originating good of a Party if it meets all other applicable criteria set out in this Circular for qualifying as an originating good, and:
+ in the case of a good classified under Chapters 16, 19, 20, 22, 23, 28 through 49, and 64 through 97 of the Harmonized Commodity Description and Coding System, the total value of non-originating materials used in the production of the good that have not undergone the required CTC does not exceed 10% of the FOB.
+ in the case of a particular good classified under Chapters 18 and 21 of the Harmonized Commodity Description and Coding System, the total value of non-originating materials used in the production of the good that have not undergone the required CTC does not exceed 10% or 7% of the FOB, as specified in Annex I enclosed herewith.
+ in the case of a good classified under Chapters 50 through 63 of the Harmonized Commodity Description and Coding System, the weight of all non-originating materials used in the production of the good that have not undergone the required CTC does not exceed 10% of the total weight of the good.
- 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-based rule of origin for the good as prescribed in Clause 1 Article 8 of this Circular.
What is the De Minimis in the rules of origin under the ASEAN-Japan Comprehensive Economic Partnership Agreement in Vietnam? (Image from the Internet)
What are the regulations on manufacturing or processing operation in the rules of origin under the ASEAN-Japan Comprehensive Economic Partnership Agreement in Vietnam?
According to Article 11 of Circular No. 37/2022/TT-BCTT, a good shall not be considered to satisfy the requirements of CTC or specific manufacturing or processing operation merely by reason of:
- operations to ensure the preservation of products in good condition during transport and storage (such as drying, freezing, keeping in brine) and other similar operations;
- changes of packaging and breaking up and assembly of packages;
- disassembly;
- placing in bottles, cases, boxes and other simple packaging operations;
- collection of parts and components classified as a good pursuant to Rule 2(a) of the General Rules for the Interpretation of the Harmonized Commodity Description and Coding System;
- mere making-up of sets of articles;
- any combination of operations referred to in Clauses 1 through 6 of this Article.
What is the formula for calculation of regional value content in the rules of origin under the ASEAN-Japan Comprehensive Economic Partnership Agreement in Vietnam?
In Article 8 of Circular No. 37/2022/TT-BCTT, the formula for calculation of regional value content in the rules of origin under the ASEAN-Japan Comprehensive Economic Partnership Agreement is as follows:
Where:
+ FOB is, except as provided for in Clause 2 of this Article, the free-on-board value of a good, inclusive of the cost of transport from the producer to the port or site of final shipment abroad.
+ RVC is the RVC of a good, expressed as a percentage.
+ VNM is the value of non-originating materials used in the production of a good.
- For the purposes of Point a Clause 1 of this Article, FOB shall be the value:
+ adjusted to the first ascertainable price paid for a good from the buyer to the producer of the good, if there is free-on-board value of the good, but it is unknown and cannot be ascertained; or
+ determined in accordance with Articles 1 through 8 of the Agreement on Customs Valuation, if there is no free-on-board value of a good.
- For the purposes of Clause 1 of this Article, the value of non-originating materials used in the production of a good in a Party:
+ shall be determined in accordance with the Agreement on Customs Valuation and shall include freight, insurance, and where appropriate, packing and all other costs incurred in transporting the material to the importation port in the Party where the producer of the good is located; or
+ if such value is unknown and cannot be ascertained, shall be the first ascertainable price paid for the material in the Party, but may exclude all the costs incurred in the Party in transporting the material from the warehouse of the supplier of the material to the place where the producer is located such as freight, insurance and packing as well as any other known and ascertainable cost incurred in the Party.
- For the purposes of Clause 1 of this Article, the VNM of a good shall not include the value of non-originating materials used in the production of originating materials of the Party which are used in the production of the good.
- For the purposes of Point b Clause 2 of this Article or Point a Clause 3 of this Article, in applying the Agreement on Customs Valuation to determine the value of a good or non-originating material, the Agreement on Customs Valuation shall apply, mutatis mutandis, to domestic transactions or to the cases where there is no domestic transaction of the good or non-originating material.
Circular No. 37/2022/TT-BCTT takes effect from March 1, 2023
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