Rules of origin have become a very prominent feature of today’s trading system. The determination of origin is a very important element in international trade relations. The tariff classification, value and origin of good are determining factors based on which the customs tariff treatment is applied. For customs matters, there is a distinction between two types of origins, notably non-preferential origin and preferential origin.

• NON-PREFERENTIAL ORIGIN

Non-preferential rules of origin are used to determine the origin of goods for the application of the most-favoured nation treatment (MFN), but also for the implementation of a number of commercial policy measures such as anti-dumping, safeguard measures and quantitative restrictions or tariff quotas. They are also used for trade statistics, public tenders and origin marking.

• PREFERENTIAL ORIGIN

Preferential rules of origin are linked to the special trade arrangements and agreements. Where all the requirements are met, goods with preferential origin are eligible to be imported with lower duty rates or at zero rate, depending on the preferential tariff treatment provided for.

The CEFTA rules of origin are based on the Pan-Euro-Mediterranean preferential rules of origin (PEM Convention). Additionally, the Parties decided to introduce the new transitional rules of Pan-Euro-Mediterranean preferential rules of origin (PEM Convention). These rules will apply as rules alternative to those of the PEM Convention that will continue to be in full application among all PEM Contracting Parties.

The system of Pan-Euro-Mediterranean cumulation of origin allows for the application of diagonal cumulation between the EU, EFTA, Turkey, the parties which signed the Barcelona Declaration, the Western Balkans and the Faroe Islands.