G/RO/LDC/N/USA/2  
 
11 July 2017  
(17-3717) Page: 1/6 
Committee on Rules of Origi n Original: English  
 
NOTIFICATION OF PREF ERENTIAL RULES OF OR IGIN FOR  
LEAST DEVELOPED COUN TRIES  
UNITED STATES 
The following communication, dated 30 June 2017, is being circulated at the request of the 
delegation of United States . 
 
_______________  
 
 
Paragraph 4.3 of the 2015 M inisterial Decision on preferential rules of origin for least developed 
countries (WT/L/917/Add.1) requires preference -granting Members  to notify preferential rules o f 
origin as per the established procedures1. In addition, as mandated by the Ministerial D ecision, the 
Committee on Rules of Origin agreed, at its meeting of 2 March 2017, to a template  for such 
notifications (G/RO/84 ). 
 
Following such requirements, the following notification has been received from: United States . 
 
A. BASIC INFORMATION  
 
1)  Notify ing member  United States  
2)  Date of entering into force of Rules 
of origin and any substantive  
modification thereof  1 January 1984.  
Caribbean Basin Economic Recovery Act (CBERA)  
https://www.gpo.gov/fdsys/pkg/STATUTE -97/pdf/STATUTE -
97-Pg369.pdf  
3)  Date of expiration of Rules of origin 
if applicable  The Caribbean Basin Economic Recovery Act (CBERA) was 
passed in 1983.  In 2000, the Caribbean Basin Trade 
Partnership Act (CBTPA) sub stantially expanded the CBERA.  
The HOPE Act (2006), the HOPE II Act (2008), and the HELP 
Act (2010) provided additional benefits for textile and apparel 
products from Haiti.  The CBERA has no set expiration date.  
The CBTPA is scheduled to expire on 30 Se ptember 2020, and 
the preferences under HOPE and HELP are scheduled to expire 
on 30 September 2025.  
4)  Title of the preferential scheme for 
which legislation on Rules of origin 
is applicable  Caribbean Basin Economic Recovery Act.  
5)  Authority(ies) granting t he 
preferential treatment  President of the United States ( www.whitehouse.gov ) 
6)  National authorities in charge of 
Rules of origin administration  Office of the U.S. Trade Representative ( www.ustr.gov ) 
Office of Western Hemisphere Affairs  
1-202-395-3412 
correspondence@ustr.eop.gov  
                                                
1 The relevant notification requirements are contained in Paragraph 2(d) of Annex 1 of the Transparency 
Mechanism for Preferential Trade Arrangements (WT/L/806) and in Paragraph 4 of Annex II of the Agreement 
on Rules of Origin.  G/RO/LDC/N/USA/2  
 
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  B. INFORMATION ON RULES OF ORIGIN  
I.  BENEFICIARIES  
1)  List of Beneficiaries  Presently, 17  countries  and territories are receiving the 
preferential treatment available to all beneficiaries under the 
CBERA.  These countries and territories are:  Antigua and 
Barbuda, Aruba, The Bahamas, Barbados, Belize, British Virgin 
Islands, Curaçao, Dominica, Grenada, Guyana, Haiti, Jamaica, 
Montserrat, St. Kitts and Nevis, St.  Lucia, St. Vincent and the 
Grenadines, and Trinidad and Tobago.  In addition, 8 countries 
are receiving benefits (mainly relating to textiles and 
petroleum) under the Caribbean Basin Trade Partne rship Act 
(CBTPA).  These countries are:  Barbados, Belize, Curaçao, 
Guyana, Haiti, Jamaica, St. Lucia, and Trinidad and Tobago.  
Finally, Haiti -only textile benefits are provided under HOPE, 
HOPE II, and HELP.  Each of the additional programs was 
created by amending the CBERA law.   
2)  Eligibility  Countries Eligible for CBERA Benefits: Section 212(b) of the 
Caribbean Basin Economic Recovery Act (Public Law 
No. 98-67), accessible at:  
https://www.gpo.gov/fdsys/pkg/STATUTE -97/pdf/STATUTE -
97-Pg369.pdf  
 
II.  CRITERIA FOR DETERMINING SUBSTANTIAL TRANSFORMATION  
1)  General criteria, if applicable for all 
products   The general rule of origin can be found in 19 USC 2703(a)(2).  
This rule does not apply to textile and apparel goods.  The rule 
of origin for textile and apparel goods is described in section 2, 
on product -specific rules (see below).  
"§2703. Eligible articles  
(a) Growth, product, or manufacture of beneficiary countries  
(1) Unless otherwise excluded from eligibility by this chapter, 
and subject to section 423 of the Tax Reform Act of 1986, 
and except as provided in subsection (b)(2) and (3), the 
duty-free treatment provided under this chapter shall 
apply to any article which  is the growth, product, or 
manufacture of a beneficiary country if - 
 (A) that article is imported directly from a beneficiary 
country into the customs territory of the United 
States; and  
 (B) the sum of (i) the cost or value of the materials 
produced in a  beneficiary country or two or more 
beneficiary countries, plus (ii) the direct costs of 
processing operations performed in a beneficiary 
country or countries is not less than 35 per centum 
of the appraised value of such article at the time it 
is entered."  
 (a) Definition of wholly obtained 
products  The definition for wholly obtained products can be found in 19 
CFR 10.191(b)(3):  
"3)   Wholly the growth, product, or manufacture of a 
beneficiary country.  For purposes of §10.191 through 
§10.199, the expressio n "wholly the growth, product, or 
manufacture of a beneficiary country" refers both to any 
article which has been entirely grown, produced, or 
manufactured in a beneficiary country or two or more 
beneficiary countries and to all materials incorporated in 
an article which have been entirely grown, produced, or 
manufactured in any beneficiary country or two or more 
beneficiary countries, as distinguished from articles or 
materials imported into a beneficiary country from a 
non-beneficiary country whether or n ot such articles or 
materials were substantially transformed into new or 
different articles of commerce after their importation into 
the beneficiary country."  G/RO/LDC/N/USA/2  
 
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   (b)  Describe the criteria for not -
wholly produced products  No article which has undergone only  a simple combining or 
packaging operation or a mere dilution in a beneficiary 
developing country will be entitled to duty -free treatment.  19 
CFR 10.195(a)(2) provides a non -exhaustive list of operations 
that are insufficient to confer origin.  
 (c)  Insert the formula for 
calculating ad valorem  
percentage  The formula for calculating the regional value content of the 
article can be found in 19 CFR 10.195(a)(1).  Under the 
formula, the sum of the cost or value of the materials 
produced in the beneficiary d eveloping country or any two or 
more countries that are members of the same association of 
countries, plus the direct costs of processing operations 
performed in the beneficiary developing country or member 
countries, must not be less than 35% of the appra ised value 
of the article at the time it is entered.  
In addition, 19 CFR 195(b) provides that the value of inputs 
from Puerto Rico, the U.S. Virgin Islands, and any former 
beneficiary countries can be included when calculating the 
35% requirement.  Finally , 19 CFR 10.195(c) provides that up 
to 15% of the aforementioned 35% requirement can be 
satisfied by value of materials produced in the United States.  
2)  Product specific rules of origin, where applicable  
 (a)  Insert  the link where the 
complete list of  product 
specific rules of origin can be 
found.  The CBTPA, HOPE, and HELP programs provide for the 
preferential treatment of certain textile and apparel products, 
footwear, and non -textile travel goods.  The rules of origin for 
these articles are different  from the general rule described 
above and are described below.  
CBTPA  
CBTPA provides duty -free treatment for imports of qualifying 
cotton, wool, and man -made fibre apparel classified in HTS 
chapters 61 and 62 from CBERA countries. For the most part, 
these CBTPA apparel goods must be made wholly of U.S. or 
CBERA -regional inputs and assembled in an eligible CBTPA 
country listed in chapter 98 of the HTS. The CBTPA also 
extended preferential treatment to a number of other products 
previously excluded from CBERA , including petroleum and 
petroleum products, certain tuna, certain footwear, and 
certain watches and watch parts. The rates of duty for these 
products are identical to those accorded to like goods from 
Mexico, under the same rules of origin applicable und er the 
North American Free Trade Agreement (NAFTA) found in 
General Note 12 of the HTSUS.  
Please see 19 CFR 10.223:  https://www. ecfr.gov/cgi -
bin/text -
idx?SID=61efe140c8a30e01ae54661a8c33c917&mc=true&no
de=se19.1.10_1223&rgn=div8  
Haiti HOPE and HELP  
HOPE and HELP provide duty -free treatment for certain textile 
and apparel products not already covered under CBTPA.  
Please see 19 CFR 1 0.843: https://www.ecfr.gov/cgi -bin/text -
idx?SID=61efe140c8a30e01ae54661a8c33c917&mc=true&no
de=se19.1.10_1843&rgn=div8  
 (b)  Insert the formula for 
calculating ad valorem  
percentage, when applied for 
product specific rule  N/A. 
3) Definition of non -originating 
material and originating material, if 
any N/A. 
4) List of insufficient working process, 
if any  Under 19 CFR 10.195(a)(2),  simple combining or packaging 
operations or mere dilution carried out in a beneficiary country 
does not confer origin, even if the processing operation causes 
the article to meet the value requirement.  That section of the 
regulation also contains an illu strative list of non -qualifying 
operations.  G/RO/LDC/N/USA/2  
 
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  5) Rules for application of cumulation 
and related procedures if any  All CBERA beneficiary countries may cumulate (i.e., use inputs 
from other countries to meet the local value content 
requirement) with other be neficiary countries, including Puerto 
Rico and the U.S. Virgin Islands.  Under CBERA, up to 15% of 
the 35% local value content requirement may be attributable 
to the cost or value of materials produced in the United 
States.  In addition, CBERA beneficiarie s may cumulate with 
former CBERA beneficiaries.  A "former beneficiary" is defined 
as a country that ceases to be designated as a beneficiary 
country under the particular preference program because the 
country has become a Party to a free trade agreement w ith 
the United States.  
6) Any other information that member 
deems necessary  U.S. Customs and Border Protection has published a guide to 
the Caribbean Basin Trade Partnership Act: "What Every 
Member of the Trade Community Should Know About: U.S. -
Caribbean Trade Partnership Act."  It can be accessed at:  
https://www.cbp.gov/sites/default/files/assets/documents/201
6-Apr/us_carib_trade_3.pdf  
Specific informati on about the textile and apparel provisions of 
CBTPA, HOPE and HELP can be found on the website of the 
Office of Textiles and Apparel, part of the U.S. Department of 
Commerce (otexa.trade.gov, then click on "CBTPA" or "Haiti" 
under "Trade Agreements").  
 
III.   DOCUMENTARY REQUIREMENTS  
1)  Certificate of origin and other proofs of origin  
 (a)  Requirement for certificate of 
origin and/or any other proof 
of origin, if any  As noted above, the programs collectively known as the 
Caribbean Basin Initiative cons ist of separate preferences that 
are available to different groups of beneficiaries.  As such, the 
documentary requirements differ depending on the preference 
program and the good being exported to the United States.  
CBERA (19 CFR 10.198)  
A certificate of origin is not required.  
CBTPA (19 CFR 10.224, 10.234 -10.236)  
For textile and apparel goods, a Certificate of Origin must be 
employed to certify that the article being exported from a 
CBTPA beneficiary country to the United States qualifies for 
preferential  treatment.  The Certificate of Origin must be 
prepared by the exporter in the CBTPA beneficiary country in 
the form specified in the regulations.  For non -textile and 
apparel goods, CBP form 450 must be used.  
HOPE and HELP  
A certificate of origin is not r equired, but there are other 
administrative requirements.  
 (b)  Authority to be designated for 
issuance of certificate of origin  The certificate of origin is to be completed by the exporter or 
other person with appropriate party having knowledge of the 
facts. 
 (c)  Prescribed form of Certificate 
of origin and/or any other 
proof of origin  CBTPA  
Non-Textile Goods, CBP Form 450:  
https://www.cbp.gov/sites/default/files/doc uments/CBP%20Fo
rm%20450_0.pdf  
Textile Goods:  
https://www.ecfr.gov/graphics/pdfs/er21mr03.002.pdf  
 (d)  Any other procedures applied 
for certificate of origin and/or 
any other proof of or igin, if 
any N/A. G/RO/LDC/N/USA/2  
 
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  2)  Direct shipment  
 (a)  Rules applicable for direct 
shipment, if any  In general, in order to qualify for preferential treatment, the 
eligible article must be imported directly from a beneficiary 
country to the United States.  The term  "imported directly" is 
defined at 19 CFR 10.193.  
Special rules apply for imports of textile and apparel goods 
under HOPE and HELP.  Eligible textile and apparel goods must 
be exported directly from either Haiti or the Dominican 
Republic.  Please see 19 CF R 846.  
 (b)  Documentary requirement for 
proof of direct shipment 
including when the transport 
of consignment involves 
transit through one or more 
intermediate countries, if any  The documentary requirements can be found at 19 CFR 
10.194.  In general, if t he shipment from a beneficiary country 
to the United States passes through the territory of any other 
country, the merchandise in the shipment cannot enter into 
the commerce of any other country while en route to the 
United States, and the invoice, bills o f lading, and other 
shipping documents must show the U.S. as the final 
destination.  
 
IV.  VERIFICATION AND PENALTIES  
1)  Procedure for verification of proofs 
of origin  The regulations related to examination, sampling, and testing 
of merchandise can be fou nd at 19 CFR 151.1 through 151.16.   
2)  Penalties for fraud and false 
declarations  In general, if a claim for preference under CBERA is incorrect, 
the importer’s claim of preference will be denied, and the 
importer must pay the applicable duty.  If a Cus toms and 
Border Protection Officer finds any package that contains an 
article not specified on the invoice, and there is reason to 
believe the article was omitted from the invoice by fraud, 
gross negligence, negligence on the part of the seller, shipper, 
owner, or agent, a monetary penalty may be imposed, or in 
some cases, the merchandise may be seized or forfeited. 
(See e.g., 19 U.S.C. 1592, 19 CFR 162.)  
3)  Authorities and procedures for 
appeal in the case of dispute on 
verification  An importer may disag ree with the dutiable status after the 
entry has been liquidated. A decision at this stage of the entry 
transaction is requested by filing a protest and application for 
further review on CBP Form 19:  
https://www.cbp.gov/sites/default/files/documents/CBP_Form
_19.pdf  
4) Requirement for preserving the 
documents related to issuance of 
certificate of origin  Importers who make a claim of preference under CBERA are 
required to maint ain records to support that claim for a period 
of 5 years from the date of entry.  
5) Any other relevant information  Section 215 of the Caribbean Basin Economic Recovery Act 
(CBERA), as amended (19 U.S.C. 2704), requires the U.S. 
International Trade Commis sion to provide biennial reports in 
odd-numbered years to the Congress and the President on the 
economic impact of the CBERA on U.S. industries and 
consumers and on the economy of beneficiary Caribbean Basin 
countries.  The most recent report is available here:  
https://www.usitc.gov/publications/332/pub4567.pdf  
Section 212(f) of the CBERA requires the United States Trade 
Representative (USTR) to submit a report to Congress 
regarding the resu lts of the general review of beneficiary 
countries and their performance under the eligibility criteria. 
The most recent report is available here:  
https://ustr.gov/sites/default/ files/2015 -CBI-Report -Final.pdf  
 
V.  REFERENCE TEXTS  
(a) The legislative texts in one of the 
official WTO languages containing 
the preferential rules of origin 
applicable under a PTA granted 
under the Decision on Measures in 
Favour of Least -Developed 
Countries (Annex F of the Hong 
Kong Ministerial Declaration)  See Section II above.  G/RO/LDC/N/USA/2  
 
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  (b) The full text of the administrative 
regulations concerning modalities 
for issuance, acceptance, 
retrospective issuance and 
replacement of certificates of 
origin or any equ ivalent 
declarations to be made, including 
any requirements  related to 
stamps to be used along with 
notification of stamps  See Section III above.  
(c) The full text and related 
administrative regulations of the 
modalities for the proof of 
movement of the consignment of 
the goods from the beneficiary 
countries to preference -giving 
countries including transit through 
third countries  See subsection III.2 above.  
(d) The full texts of the modalities of 
the verification procedures and 
related penalties  See Sect ion IV above.  
__________