Topic Overview
- Certificate of Origin Certifies the “Origin” of the Exported Goods
- Usually, Local Chamber of Commerce issues this certificate
- Sometimes the buyer may try to get GSP (Generalized System of Preference)
- Commercial Invoice has to be attested by the authorities at the time of issuing the Certificate Of Origin
Definition of Certificate of Origin
Certificate of Origin is the document that certifies the origin of the country where the exported goods are manufactured originally. Most of the cases, the buyer needs only the certificate issued by the local chamber of commerce. Some cases, the buyer may insist to get GSP (Generalized System of Preference) issued by export council agencies of respective county. A copy of Commercial invoice has to be attested by authorities at the time of issuing the certificate of origin.
Importance of Certificate of Origin
This certificate is required for customs clearance of imported goods. A question may arise why this certificate is such an important document for customs clearance. Actually, a particular country may set different “Duty rate” for same product import from a different country. This depends on the government policies of importing country and with the relationships of the exporting country.
Suppose, the Government of USA imposed high customs duty for goods imported from China. If the same goods imported from other countries their rate may be more flexible than China. For this reason Certificate Of Origin is necessary for the Government.
When goods imported from different Countries
When goods have been manufactured in several countries, a conflict may arise with the country of origin. In these cases, the country of origin will determine proportionately according to the value added to each country. At least 50% value is added to determine the country of origin. For example, Japan provides 100% of the raw materials, but the final product is manufactured in France. If the value-added in France is 50% or more of the sales price, then the country of origin is France.