GSP and Rules of Origin1

Hideki MORI
UNCTAD

1 The views expressed in this paper are the views of the author and do not necessarily reflect the views or policies of the Asian Development Bank (ADB) or its
Board of Directors or the governments they represent. ADB makes no representation concerning and does not guarantee the source originality, accuracy,
completeness, or reliability of any statement, information, data, finding, advice, opinion, or views presented.
 Introduction of GSP

• EU, Japan 1971

• Canada 1974
• United States 1976
The Generalized System of
Preference (GSP)
The main principles of GSP
• Generality
• Non-reciprocity
• Non-discrimination
 Elements of GSP scheme
Beneficiary
Product
Coverage
Rules of Origin
Depth of
tariff cuts
Safeguard

Graduation
 Three Elements of
GSP Rules of Origin

• Origin criteria
• Direct consignment
• Documentary evidence
Methods of determining
product origin

• Change in tariff numbers

• Valued-added test
• List of specified process
GSP scheme of Japan

First introduced on
1st August 1971
Extended three
times for 10 years
Effective until
31st March 2011
 Beneficiaries

163 countries and territories

Product coverage

Almost all industrial

products
(Negative List)

Many agricultural
Products
(Positive List)
Depath of tariff cuts
Normal GSP

– Industrial products: GSP =

Duty free
– Some sensitive industrial
products: GSP =
100~20% of MFN rate
– Agricultural products: GSP =
various reduction from MFN
rate
 Safeguards
General safeguard

Preferential
treatment
If preferential
imports cause
serious difficulty
for domestic
producers
Graduation
GRADUATION

Country Graduation

19 countries and
territories from
April 2000
Apan
Three elements of Rules of origin

Origin Criteria

Direct
consignment
conditions

Documentary
Evidence
Products wholly obtained
in one country or area

e.g.
vegetable products
harvested in one
country or area
 Criteria for judging wholly
obtained products

• Mineral products extracted from one country or area

• Vegetable products harvested in one country or area
• Live animal born and raised in one country or area
• …………
• …………
• …………
 Origin Criteria
Products originating in one country or area

Products wholly obtained

in one country or area

Products
produced from
imported
materials
 Origin Criteria

Change in Tariff
Products
manufactured Heading
with goods or
from other
countries Specific Process
for Substantial
Transformation
 Rules of Origin
Condition for
Products
Product Description origin country
groups
acknowledgement
Articles of apparel
and clothing
accessories, not
Manufactured from
Chapter 62 knitted or crocheted,
woven fabrics or knitted
other than those of
heading No. 6213 to
6217

Woven fabrics
Jacket
(imported)
(HS 6201)
 Rules of Origin
Condition for
Products
Product Description origin country
groups
acknowledgement
Preparations of meat,
Manufactured from
of fish or of
originating products of
Chapter 16 crustaceans,
Chapter 1 or 3
molluscs or other
aquatic invertebrates

Frozen tunas Preparation of fish

(HS 0303) (HS 1604)
(originating products)
 Donor country content

Japanese materials are considered as

originating in preference receiving country
if they are used in the preference receiving
country in the production process
 Regional accumulation

Products produced in five Southeast Asian

countries, namely, Indonesia, Thailand,
Philippines, Malaysia and Viet Nam fall
under the accumulation of origin.
Rules of transportation
Direct consignment conditions

In principle, the goods must be transported

directly to Japan.
 Documentary Evidence
Documentary Evidence

For evidence of originating status

- the Certificate of Origin Form A

 How to use the GSP

•Step1: Classification of the product

•Step2: Product Coverage
•Step3: Origin Criteria
•Step4: Transportation
•Step5: Documentary Evidence