Rules of Origin

Rules of Origin (ROO) are the laws and regulations used in international trade to define where a product was made. ROO are important when implementing trade policy tools such as anti-dumping and countervailing duties, and in the context of Regional Trade Agreements (RTAs) and Free Trade Agreements (FTAs). Globalisation of the supply chain has, however, made it increasingly difficult to determine where a product 'originally' comes from, since raw materials and parts used to make finished goods are drawn from all over the world. The Committee on Trade and Investment (CTI) has therefore agreed to work towards harmonisation of these rules among APEC member economies.

Last page update: February 2016

Current Activities

Recent projects and advances made on ROO-related issues include:

An APEC Pathfinder for Self-Certification of Origin was launched by the CTI. This Pathfinder seeks to reduce the administrative burdens and costs associated with navigating complex rules of origin documentation and procedures when utilizing FTAs. Eleven economies are now fully participating in the pathfinder. They include Australia; Brunei Darussalam; Canada; Japan; Korea; Malaysia; New Zealand; the Philippines; Singapore; Chinese Taipei and the United States.

The APEC Self-Certification of Origin Capacity Building Programme was endorsed at the second CTI meeting in June 2010. The programme consists of a general workshop and four in-economy workshops aimed at supporting the further participation of APEC economies in the Pathfinder and contributing to the successful implementation for participating economies. The first workshop was held in Kuala Lumpur, Malaysia on 11-12 October 2010; the second in Manila, the Philippines on 10-11 February 2011; the third in Bandar Seri Begawan, Brunei Darussalam on 4-5 April 2011; and the fourth in Hanoi, Viet Nam on 28-29 July 2011. In order to maintain the momentum generated by the capacity building workshops, the MAG agreed in May 2011 to establish a rolling agenda item consisting of a yearly report from relevant economies on progress made towards implementing self-certification of origin and/or joining the Pathfinder initiative.

A set of APEC Elements for Simplification of Documents and Procedures Relating to Rules of Origin (ROOs) was adopted by the Market Access Group (MAG) and the Sub-Committee on Customs Procedures (SCCP). Among the elements, the MAG in 2011 has carried out surveys on the use of IT in ROO and on minimum data requirements in FTAs.

Apart from work undertaken by the CTI, the MAG has agreed to conduct analytical work on preferential ROO and to examine common or model approaches to ROO for specific sectors. In 2009, the MAG completed analyses of five sectors (refrigerators, musical instruments, steel, bicycles and consumer electronics) led by Australia, Japan, Chinese Taipei and the United States. In 2010, another two ROO sector analysis was completed on sporting equipment and motor vehicles, parts, accessories and hand tools by Chinese Taipei. In 2011, Chinese Taipei completed a further sectoral analysis on machine tools/parts and toys and games.

The MAG is also working closely with ABAC to garner more inputs from the business community. Other partnerships under consideration include working with multilateral organizations such as the World Customs Organization (WCO) on ROOs. The WCO has attended past MAG meetings to share its work and experiences on the subject of ROOs and will likely attend the first MAG meeting in 2012 to further exchange ideas on possible areas of cooperation between the two groups.

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Achievements

Rules of Origin

APEC has developed model measures for RTAs and FTAs to encourage a coherent and consistent approach to the design and content of such agreements. The model chapters for Rules of Origin and Origin Procedures were endorsed by the Ministers Responsible for Trade in 2007. The model measures are indicative examples to provide members with a useful reference when negotiating RTA/FTA chapters.