EU-UK Free Trade Agreement: the origin of goods
On December 30th, 2020, the Customs Agency supplemented Circular No 49, with Protocol No 495536/RU, by providing further information on the preferential origin of goods, in particular as regards the declaration to be issued by the exporter and on the regime of the proofs of origin of the goods.
The document is accompanied by a series of answers from the Agency to frequently asked questions, aimed at clarifying the application of the EU-UK trade cooperation agreement.
As known, on the basis of the “Trade and Cooperation Agreement”, agreed between the European Union and the United Kingdom, customs duties on all goods originating in the respective contracting parties are zeroed.
For this purpose, goods must comply with all the rules of origin laid down in the Agreement; in particular, with regard to exports to the United Kingdom:
- the exported goods must meet the requirements to obtain EU origin;
- the goods must be shipped directly to the UK;
- the exporter must provide a valid certificate of origin to the UK importer. The certificate of origin can be included directly in the invoice for shipments of up to 6,000€, whereas beyond (this value) the European Union requires that the European Union exporter, in order to be able to issue the aforementioned declaration in the invoice, be registered in the so-called “REX system”.
Pending the activation of the European Union new REX Portal and the acquisition of any further elements deriving from the Agreement, undergoing ratification, operators who are still without the REX code will be able to include the declaration of origin on invoice or other commercial document, using a self-certification of the preferential origin and thus avail themselves from the zero duty at the English border.
For this purpose, the model of declaration of preferential origin annexed to Circular No 49/2020 must include, in the “place and date” field of the declaration, the EORI code of the company together with its full address, unless the data is updated as soon as the operator obtains the registration code to the REX system.
This is a temporary derogation granted to companies operating with the United Kingdom, given their difficulty of complying with the new rules which came into force last January 1st, 2021.
A further simplification, of a temporary nature, was provided for by Implementing Regulation (EU) 2020/2254 regarding the compilation of certificates of origin made on the basis of supplier declarations, of which the exporter to the United Kingdom should normally be in possession but which at this juncture may not have been able to obtain in a timely manner.
This Regulation allows exporters – during the period 1/1/2021-31/12/2021EU – to complete certificates of origin, also when they do not have all the supplier’s declarations necessary to determine the originating status of the goods.
In practice, during this transitional period (1/1/2021 – 31/12/2021) the validity of the certificate of origin cannot be called into question because the exporter does not have all the relevant supplier declarations on the basis of which he has completed the declaration.
Nevertheless, these declarations must be recovered by the exporter by 1.1.2022; if by 1.1.2022 the exporter will not have been able to get hold of the declarations of the provider will have to inform its customer in United Kingdom, by January 31st, 2022.
WTS R&A is available to accompany its clients in all operations to and from the United Kingdom and in the analysis and application of the various profiles of the Agreement relating to trade in goods.