Generalised System of Preferences (GSP) - Information for Importers - CDPN27
This guide is in a question and answer format and is based on questions most frequently asked by importers. A summary of the questions and answers is provided below.
- What is GSP?
- What conditions must be satisfied for obtaining preferential treatment?
- What countries are eligible to benefit under GSP?
- What goods are eligible for preference?
- Where can I find out the preferential rates of duty available under the GSP scheme?
- How do goods qualify as originating products?
- What is a Certificate of Origin Form A?
- Has a Form A a specific validity period?
- What if a Form A is not issued at time of exportation?
- What if a Form A is lost, destroyed or stolen?
- When are replacement Certificates of Origin Forms A issued?
- What is the Direct Transport/Non-Manipulation Rule?
- What documentary evidence may be required to show Direct Transport/Non-Manipulation?
- What evidence is required to comply with the direct transport rule for Chinese goods transiting through Hong Kong ?
- Are there any opportunities for EU exporters under GSP?
- Is there any provision for regional cumulation in the GSP arrangements?
- Where can I get further information?
The Generalised System of Preferences (known as GSP for short) is a scheme whereby a wide range of industrial and agricultural products originating in certain developing countries are given preferential access to the markets of the European Union.
Preferential treatment is given in the form of reduced or zero rates of customs duties.
The GSP scheme is specifically designed to benefit certain developing countries and integrate them into the world economy.
Certain products on importation into the EU are eligible for reduced or zero rates of customs duties provided that they:
- are eligible for preference under the GSP scheme
- qualify as originating products under the rules of origin set down in the Community Customs Code Implementing Provisions – see http://ec.europa.eu/taxation_customs/customs/customs_duties/rules_origin/index_en.htm .
- are transported directly from the GSP country to the EU (commonly referred to as the Direct Transport Rule)
- are accompanied by a valid Certificate of Origin Form A or, provided the value of the consignment is less than €6,000 are accompanied by an Invoice Declaration made out by the exporter on an invoice or other commercial document, the text of which is as follows:
The exporter of the products covered by this document declares that, except where otherwise clearly indicated, these products are of ..… preferential origin according to the rules of origin of the Generalised System of Preferences of the European Community and......
(place and date)
- GSP Forms A and Invoice Declarations issued in a GSP Beneficiary country have a period of validity of 10 months from their date of issue, and they must be presented in support of a claim to preference within that period. In exceptional circumstances we may accept Forms A and Invoice Declarations outside their period of validity.
Three distinct categories of countries can benefit under the GSP scheme provided the goods are produced in accordance with the relevant rule of origin
- Developing countries/territories enjoy preferential access to EU markets
- Least developed developing countries (LDDC) benefit from zero duty on import into the EU for all products of Chapters 01- 97 with the exception of Chapter 93.
- Special incentive arrangement for sustainable development and good governance - GSP+
Details of eligible products can be found in the EU legislation governing the GSP scheme. Commission Regulation No. 2454/93 as amended by Commission Regulation No. 1063/2010.
Rates of duty are available in the Taric database at: http://ec.europa.eu/taxation_customs/dds2/taric/taric_consultation.jsp?Lang=en&Screen=0&redirectionDate=20110530
The concept of "originating product" forms the basis upon which preferential access is granted to products entering the EU under GSP. Products are considered as originating in two ways:
- Products wholly obtained in a GSP country
- Products considered to be originating in a GSP country when the raw materials used are sufficiently worked or processed. The GSP scheme provides rules of origin to ensure that this condition is satisfied. Each product has a specific origin rule which can be found the Customs Code Implementing Provisions. The rule of origin is based on the first four digits of the Tariff Classification Code for the product. For details see http://ec.europa.eu/taxation_customs/customs/customs_duties/rules_origin/index_en.htm .
A Certificate of Origin Form A is the documentary evidence required to claim preferential treatment (reduced or zero rate of duty) on importation into the EU.
The Form A is issued by the competent governmental authority in the exporting country and is provided by the exporter to the importer in the EU. It will normally accompany the goods.
The Form A can only be issued when the goods to which it relates are originating products within the meaning of the GSP scheme.
Yes, the Form A must be submitted, to the customs authority of the importing Member State, within 10 months of the date of issue.
However, the customs authority in the Member State may accept a Form A which has passed its expiry date where failure to observe the time limit is due to force majeure or exceptional circumstances.
In exceptional circumstances, a Certificate of Origin Form A may be issued after the actual exportation of the goods to which it relates. In this case, the competent authority in the exporting country must endorse Box 4 of the Form A with the words "Issued Retrospectively".
In the event of theft, loss or destruction of a Form A, the exporter may apply to the competent authority for a duplicate to be issued. In this case, Box 4 of the duplicate Form A must bear the endorsement "Duplicate", together with the date of issue and the serial number of the original certificate. The duplicate shall take effect from the date of the original.
On occasions where parts of a consignment of goods imported from a GSP country are destined for different Member States, a replacement Form A may be issued by the customs authority in the first Member State of entry into the EU.
This requires that the products declared for release for free circulation in the EU must be the same products as were exported from the GSP beneficiary country in which they are considered to originate. They must not have been altered, transformed in any way or subjected to operations other than operations to preserve them in good condition, prior to being declared for release for free circulation. Storage of products or consignments may take place where carried out under the responsibility of the exporter or of a subsequent holder of the goods and on the condition that the products remain under customs supervision in the country(ies) of transit.
Goods will automatically be deemed to have met the non-manipulation requirement unless customs has reasonable doubts about compliance with the requirement. In such cases importers will be required to produce evidence of compliance. This may be given by any documentation which shows that the imported goods left the GSP country in which they are considered to originate and that they are the same goods as left that country.
Customs will only ask for evidence of compliance with the non-manipulation requirement where they have doubts as to whether the goods are the same as those which left the GSP beneficiary country concerned, or doubts as to whether the goods left that country in the first place.
The evidence which will be required must demonstrate that the goods imported are the same as those which left the GSP beneficiary country. It can for example, take the form of:
- a purchase order/contract with the supplier in the GSP beneficiary country together with
- a transport/shipping document/contract - bill of lading - showing that the goods were loaded in and transported from the GSP beneficiary country concerned. If the goods were transported from the beneficiary on for example, a feeder vessel and then consolidated with other consignments in a seaport en route to the EU there should be a transport document (bill of lading) for each leg of the journey. A document which simply covers the leg from the consolidating port to the EU will not suffice as it will not show that the goods left the GSP beneficiary country for which preference is being or has been claimed.
14. What evidence is required to comply with the direct transport rule for Chinese goods transiting through Hong Kong ?
Any of the following may be regarded as evidence of compliance with the direct transport rule where Chinese goods are transhipped via Hong Kong:
- a Bill of Lading issued in China, which covers the transport through Hong Kong accompanied by a certificate of origin, Form A or
- a Form A endorsed by the China Inspection Company Limited (CICL) stamp in box 4,or
- a certificate of non-manipulation issued by the CICL when the Form A is sent directly to the EU by mail.
The scheme only provides preferential access on importation into the EU. It does not provide for preferential access into third country markets. However, it is possible for exporters to send raw materials and semi-finished products which originate in the EU to GSP countries under cumulation provisions.
The cumulation provisions of the GSP enable originating materials exported from the EU to be regarded as materials originating in GSP countries when incorporated into a finished product there. The EU materials must be produced in accordance with the rules of origin laid down in the GSP scheme and must be accompanied by an EUR.1 certificate when exported.
The cumulation provisions encourage GSP countries to source raw materials in the EU as it makes it easier to satisfy origin criteria.
In certain circumstances, various beneficiary countries have been grouped together for the purposes of cumulation of origin under GSP. Cumulation is a term used to indicate the basis upon which a product may enjoy originating status, even though the normal origin rules would not confer origin on the basis of the work done in the country of last processing. Products manufactured in a beneficiary country which is a member of a regional group, may be further processed in another beneficiary country of the same group and will be treated as if they originate in the country of further manufacture.
GSP Regional Groups:
- Group I - Brunei-Darussalam, Cambodia, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand, Vietnam.
- Group 2 - Bolivia, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Honduras, Nicaragua, Panama, Peru, Venezuela.
- Group 3 - Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, Sri Lanka.
- Group 4 - Argentina, Brazil, Paraguay, Uruguay.
Office of the Revenue Commissioners,
Classification, Origin and Valuation Unit,
Corporate Affairs and Customs Division,
St. Conlon's Road,
Direct Lines: 067 63260/63213
Fax: 067 32385
European Commission website: Generalised System of Preferences