RESTRICTED  WORLD TRADE  
ORGANIZATION  G/RO/M/54 
10 May 2010 
 (10-2651) 
Committee on Rules of Origin  
  
 
MINUTES OF THE MEETING OF 25 MARCH 2010 
 
Chairperson:  Ms. Vera Thorstensen
 
 
Subjects Discussed  
 
I. REPORT OF THE WORK OF THE TECHNICAL COMMITTEE ON RULES 
OF ORIGIN...................................................................................................................... .........1  
II. TECHNICAL ISSUES IN THE H ARMONIZATION WORK PROGRAMME 
(JOB(07)/84/REV.1, G/RO/W/111/REV.5, G/RO/W/133) – REPORTING OF 
THE INFORMAL CONSULTATIONS .................................................................................2  
III. ELECTION OF OFFICERS..................................................................................................13  
IV. DATES FOR THE NEXT MEETINGS................................................................................13  
 
 
I. REPORT OF THE WORK OF THE TEC HNICAL COMMITTEE ON RULES OF 
ORIGIN 
Non-preferential rules of origin  
 1.1 The Technical Committee on Rules of Origin (TCRO) held its 28
th Session on 25 January, 
2010 at the WCO Headquarters in Brussels. The meeting was chaired by Mr. Liu Ping (People’s 
Republic of China). 
 1.2 Within the framework of its permanent r esponsibilities, the TCRO adopted the Eleventh 
Periodic Report and the Eleventh Annual Review  on technical aspects and implementation of the 
Agreement for the period from 1 January to 31 D ecember 2009.  The Annual Review related to 
technical aspects of the implementation and operation of the Agreement.  It was short since the 
Agreement has not yet been implemented in practi ce and to date no problems or specific questions 
have been referred to the TCRO.  The periodic Re port relating to technical aspects and operation of 
the Agreement also contained information on the Secr etariat’s activities and the work of the Technical 
Committee. These two documents (OCO127E1a and OC0128E1a) have been placed on the WCO 
Members Web site under the part relating to the Technical Committee’s 28
th Session.  The WTO 
representative informed the TCRO on the continuous efforts made by the CRO under the 
Harmonization Work Programme to improve the text  of the Draft Consolidated Text.  The TCRO 
took note of the latest outcome of the technical di scussions within the CRO which were reflected in 
the revised Draft Consolidated Text (Doc. G/ RO/W111/Rev 4).  The TCRO welcomed that WTO 
Members in principle agreed on the basic concepts  and approaches of Appendix 2 Rule 1 regarding 
the determination of origin. 
 Preferential Rules of Origin
 
 1.3 In the second half of 2009, the WCO Secretar iat launched for testing on the Members section 
of the WCO website a database of preferential agre ements focusing mainly on its rules of origin G/RO/M/54 
Page 2  
 
  provisions.  The database contains around 200 preferentia l trade agreements and related rules of origin 
and aims at supporting the understanding and applica tion of rules of origin in preferential trade 
agreements.  The WCO Secretariat is currently up loading available annexes / protocols of origin 
legislation covering the various lists of product sp ecific rules of origin.  The WCO Secretariat is 
continuing the Comparative Study on Preferential Rul es of Origin with the examination of rules of 
origin legislation found in NAFTA and the European origin provisions by explaining and comparing 
these two major sets of origin models.  The first results of the study will be presented to the WCO 
Council in June.  Technical Assistance and other activities provided by the WCO Secretariat
 
 
1.4 Between April 2009 and March 2010, the Secretar iat has undertaken four technical assistance 
activities relating to harmonization of non-preferential rules of origin and questions concerning the 
application of preferential rules. Two regional semina rs have been organized, one in Burkina Faso in 
March/April 2009, and the other in Japan for WCO Memb ers of the Asia/Pacific region in June 2009.  
The Secretariat also held two national seminars, one in Addis Ababa in November/December 2009 for 
Ethiopian Customs, and one in February/March 2010 for Angola Customs in Luanda.  Other information
  
 1.5 São Tomé and Principe became a WCO Me mber on 23 September 2009, and Vanuatu on 17 
November 2009.  There are now 176 WCO Members. 
 1.6 The CRO took note
 of the report and expressed appreciation for the TCRO's continued 
valuable work.  II. TECHNICAL ISSUES IN THE HARMONIZATION WORK PROGRAMME 
(JOB(07)/84/REV.1, G/RO/W/111/REV.5, G/RO/W/133) – REPORTING OF THE INFORMAL CONSULTATIONS 
2.1 Based on the informal consultations the Chai rperson had held with Members concerned, the 
Chairperson stated as follows:  
A. OVERALL
 ARCHITECTURE 
1. General Rule 6  
(a) One delegation noted that there are provisions in  Appendix 2 which are si milar to the General 
Rule 2, and that, for instance, the drying of fi sh is recognized in the CRO Chair's proposal as 
a substantial transformation, but it may be consid ered to be "ensuring preservation of goods in 
good condition for the purposes of storage".  Th erefore, the delegation suggested that the 
expression "whether a good has been wholly obtained in one country" should remain with brackets, until we all have a crystal clear idea of the scope of this provision. 
(b) One delegation stated that, according to curre nt consolidated text, minimal operation or 
process should apply to Appendix I and II both, a nd that in their view any production process 
(such as drying) which changes the nature of a good cannot qualify as a minimal operation.  
He had already provided the CRO with a text  for this rule as contained in document 
G/RO/W/121. 
(c) Several delegations stated that "dried fish" has been substantially transformed from "fresh 
fish" and that "drying" operations are differe nt from "ensuring preservation of goods in the 
good condition…"  G/RO/M/54 
 Page 3 
 
 
  (d) Egypt proposed the following list of minimal operations: 
 
 " The following is a non-exhaustive list of “Minimal Operations and Processes” which 
includes, inter alia :  
 
i)  preserving operations to ensure that th e products remain in good condition during 
transport and storage; 
ii) breaking-up and assembly of packages; 
iii) washing, cleaning; removal of dust, oxide, oil, paint or other coverings; 
iv) ironing or pressing of textiles; 
v) simple painting and polishing operations; 
vi) husking, partial or total bleaching, polishing, and glazing of cereals and rice; 
vii) operations to colour sugar or form sugar lumps; 
viii) peeling, stoning and shelling, of fruits, nuts and vegetables; 
ix) sharpening, simple grinding or simple cutting; 
x) sifting, screening, sorting, classifying, grading, matching; (including the making-up of 
sets of articles); 
xi) simple placing in bottles, cans, flasks, bags, cases, boxes, fixing on cards or boards and 
all other simple packaging operations; 
xii) affixing or printing marks, labels, logos and other like distinguishing signs on products or 
their packaging; 
xiii) simple mixing of products, whethe r or not of different kinds; 
xiv) simple assembly of parts of articles to c onstitute a complete article or disassembly of 
products into parts." 
 
(e) Some delegations stated that the word "simpl e" in Egypt's proposal appeared difficult to 
articulate, and inappropriate. 
 (f) One delegation considered items (xiii) simp le mixing and (xiv) simple assembly as 
inappropriate and suggested deleting them. 
 
2. Appendix 2
 
 
• The Chair made the following revised non-proposal: 
 
 
Non-Proposal from the CRO Chair  
 
APPENDIX 2 – PRODUCT SPECIFIC RULES OF ORIGIN 
 
 This Appendix sets forth rules for determini ng the country of origin of a good when the good 
is not considered to be wholly obt ained in accordance with Appendix 1. 
 
 Rule 1:  Determination of Origin 
 
 This Rule shall be applied in sequence, taking into account Rule 2 where applicable: 
 
(a) The country of origin of a good is the country  in which the good is produced exclusively from 
 originating materials; 
 
 Primary Rules  
 G/RO/M/54 
Page 4  
 
  (b) When a primary rule by its own terms identifies the country of origin of a good, that country 
 is the country of origin of the good;  
 
(c) The country of origin of a good is the last country of production, provided a primary rule 
 prescribed for the good in this Appendi x has been satisfied in that country; 
 Residual Rules  
 
(d) When a good is produced by further processing of  a material which is classified in the same 
 subdivision1 as the good, the country of origin of the good shall be the single country in 
 which the material originated; 
 
(e) When a good is produced by further processing a material that does not satisfy the primary 
 rule for the good, the country of origin of the good shall be the single country in which the 
 material originated.  For the purposes of this rule, account shall be taken of both originating 
 and non-originating material; 
 
(f) The country of origin of a good is the country where a residual rule at the chapter level is 
 satisfied; 
 
(g) The country of origin of a good shall be the c ountry of origin of material or materials 
 incorporated in the good by further processing, pr ovided the origin of material or materials is 
 a single country; 
 
(h) When a good is produced from materials of more than one country, the country of origin of 
 the good shall be the country in which the ma jor portion of those materials originated, as 
 determined by the criterion specified in  the Chapter where the good is classified;  
 
(i) Where the criterion for the application of Rule 1 (h) above specified in a Chapter is weight or 
 volume, and that criterion does not allow for or igin to be determined, the criterion of value 
 shall be used; where the criterion for the app lication of Rule 1 (h) above specified in a 
 Chapter is value, and that criterion does not allo w for origin to be determined, the criterion of 
 weight or volume, as appropriate, shall be used.  
  
 Rule 2:  Application 
 
(a) The rules provided in this Appendix are to be applied to goods based upon their classification 
 in the HS as referred to in General Rule 1 of this Annex and any additional subdivisions 
 created for the purposes of this Appendix; 
(b) Reference to a change in tariff classifica tion in primary rules shall apply only to non-
originating materials;   
(c) Reference to materials in the residual rules shall apply to originating and non-originating 
materials. 
(d) When the primary rule requires a change in  tariff classification, the following changes in 
 classification shall not be considered in determining the origin of the good; 
 (i) changes which result from disassembly, 
 (ii) changes which result from packaging, repackaging, or putting up for retail sale, 
                                                      
1 The term "subdivision" relates to the lowest level of classification of the good, i.e. heading, 
subheading, split heading or split subheading, at which a primary rule is specified in this Appendix.  G/RO/M/54 
 Page 5 
 
 
   (iii) changes which result solely from applica tion of General Rule of  Interpretation2(a) of 
the HS with respect to collections of parts that are presented as unassembled or 
disassembled articles. 
 
However, such changes shall not preclude conferri ng origin on a good if origin is conferred as 
 a result of other operations. 
(e)  Intermediate materials 
 Materials which have acquired or iginating status in a country are considered to be originating 
materials of that country for the purpose of de termining the origin of a good incorporating 
such materials, or of a good made from such materials by further working or processing in 
that country; 
(f)   Interchangeable goods and materials 
 When it is not commercially practical to keep separate stocks of interchangeable materials or 
goods originating in different countries, the country of origin of commingled materials or 
goods that are interchangeable may be allocated  on the basis of an inventory management 
method recognized in the country in which the materials or goods were commingled; 
(g)   De Minimis 
 For the purposes of the application of primar y rules based on tariff classification change, non-
originating materials that do not satisfy the prim ary rule shall, unless otherwise specified in a 
certain Chapter, be disregarded, provided that  the totality of such materials does not exceed 
10% of the value of the good. 
 
 
• Many delegations appreciated the Chair for ta king the initiative and needed more time for 
further considerations 
 
• Egypt maintained its reservations made at the l ast meeting and reserved the right to come back 
to the CRO Chair's non-proposal on Appendix 2 presented this time. 
 
 Rule 1(e)  
 
• Some delegations stated that the new text  of  Rule 1(e) seemed more reader-friendly;  whereas 
others questioned its usefulness and wording. 
 
• Many delegations pointed out that there is still room for improvement and that they would need 
more time for further considera tions, regarding the scope and con sequence of the application of 
this rule. 
 
• One delegation suggested the following text:  "when all originating materials satisfy the 
primary rule for the good even at the stage used for the production, the country of origin of the 
good shall be the single country in where the non- originating material which does not satisfy 
the primary rule, originated", in order to clarify the proposal's intention. 
 B. PRODUCT-SPECIFIC RULES OF ORIGIN 
Chapter Notes
 
 Egypt preferred the wording "is origin conferring". G/RO/M/54 
Page 6  
 
  Split Heading 03.05(a)
 
 It was noted that the processes of being dried and heav y salted are totally differe nt in that drying is a 
process not to involve substantial transformation in  fish but heavy salting does by fermentation and 
that fish dried and heavy salted of split heading 03.05(a) should be split by creating another split 
heading, and applying wholly obtained criterion for dried fish and CTHS criterion for heavy salted 
fish.   Split Heading 03.05(b)
 
 
The process of being smoked does not imply substantia l change in fish.  Korea suggests changing the 
criterion to wholly obtained.   Heading 04.04
 
 
Egypt reserved its right as it is still under study and there is a strong preference for wholly obtained. 
 Split heading 07.12(b
) 
 
Japan strongly requests the split h eading 07.12(b) for “Freeze-dried vegetables” should be deleted and 
such goods should be categorized in the split head ing “Other”.  Since freeze-dried vegetables are 
reversed easily to its original condition and its technology is wide ly-used, freeze-drying should not be 
origin conferring.  Origin of fresh vegetables will be confusing if such fresh vegetables are made from 
freeze-dried vegetables.  
 
Heading or subheading 09.01  
 
• Guatemala proposed as follows:  "T he origin shall be the country  where the grain was sown and 
harvested". 
• Chapter 9, Guatemala proposed for the chapter r esidual rule regarding Mixtures, Paragraph 2, 
that the percentage to be raised from 50% to 85%. 
• Guatemala also stated that it supports "CTH " rule for split subheadings ex0901.21(b) and 
ex0901.22(b). 
 
Split heading ex15.21(a)  
 
• It was noted that only refined goods are classifi ed in split heading ex15.21(a); therefore CTHS 
rule is the same as "CTHS, or change by refining". 
• Egypt reserved its position on this issue  
 Heading 21.01
 
 Extracts, essences, concentrates and preparations of coffee or tea are made by mixing various products, extracts, and additives and heating those materials.  In the process of mixing, acidity, 
sweetness, colours, turbidity, and viscosity are main factors to identify each product and quality, 
while those features are depending on the mixing process.  Korea believes those mixing process is regarded as substantial transformation so as to apply CTSHS criterion for this heading. 
 Heading 22.08
 
 
It was noted that Korea's traditional alcoholic beve rage Soju (which cannot be reproduced just by 
diluting liquors) is classified in e x22.08(b);  and therefore, origin-c onferring when it is produced from 
liquor of heading 22.07.  G/RO/M/54 
 Page 7 
 
 
  Chapter 28  
 One delegation proposed amending re sidual rule of Chapter 28 as follows:  " Goods of this chapter 
produced by mixing or otherwise combining materials of different origins, originate in the country 
that produced the materials (disregarding solvents and other additives permitted by HS Chapter note 
(1) ) that predominate by weight or volume or va lue, as appropriate, over those of each other single 
country.”   The same revision is also prevailing for Chapter 29 and 39.  
Chapter 30
 
 
• Switzerland made the following comments: 
 
 
Structural issues related to HS Heading 30.02 
 
Switzerland highlighted a question concerning the non- applicability of the origin rule related to 
galenic forms of medicaments (ampoules, vials, etc. ).  In its view, item HS 30.02 is a special case 
since both active substances and pro portioned medicine forms are classified here.  The galenic form is 
the proportioned medicine form (put up in measured doses).  It allows a patient to take a medicament 
in the correct dosage.  Thus, the current formulat ion of the origin rule for proportioned medicine 
forms is not appropriate (details below). 
 
Active substances 
 
Active substances are classified according to the WCO under HS-heading 30.02.  According to 
Primary Rule 7 (Biotechnological Processes) of Chapter 30, active substances can be 
biotechnologically processed.  The rule of origin "cha nge to the goods of this heading by biological or 
biotechnological processes" can be used. 
 
Galenic form, proportioned medicine form (ampoules, vials, etc.) 
 
Active substances are classified by the WCO under HS-heading 30.02 (including sub-headings).  The 
same goes for galenic forms which are also classified under HS-heading 30.02 (including sub-
headings).  In HS 30.02 the rule CTH is not app licable for active substances of HS 30.02 which are 
processed in proportioned medicine forms "Medicam ents (excluding goods of heading no 30.02, 
30.05 or 30.06) …".  Example: monoclonal anti-b ody:  HS 3002.10;  ampoule with active substance 
monoclonal anti-body:  HS 3002.10.  Thus CTH does not  apply in this case.  The same goes for the 
rule CTSH. 
 
Biotechnological processes 
 
The ampoules are not biotechnologically manufactured .  The active substance is mixed with other 
auxiliary materials (excipients) and then filled together into the ampoules.  The empty glass ampoule 
is filled in a germ-poor environment with special racking plants.  Staff is normally equipped with 
special protective clothing for germ-poor work.  Filling is thus to be considered as a technical process.  
Since the packing process is not origin conferring, the production of the ampoule is to be considered 
as the last substantial processing operation (last subs tantial transformation).  Thus it is not possible 
that a biotechnological process takes place.  The ru le for biotechnological processes is therefore not 
applicable for proportioned medicine forms. 
 G/RO/M/54 
Page 8  
 
   
Rule for goods of heading 30.02 – Swiss proposal 
 
Establishing an uniform rule of origin in Chapte r 30 for proportioned medicine:  from a systematic 
point of view medicine in the proportioned form (put up in measured doses or packed for retail sale) 
of heading 30.02 should not have another approach for establishing origin compared to medicine in 
proportioned form (put up in measured doses or packed for retail sale) in heading 30.04.  In the entire 
Chapter 30 the production of a proportioned medicine fo rm (excluding mere pressing of tablets or by 
mere encapsulation) should be origin conferring.  Th erefore, the rule of origin for heading 30.02 for 
the proportioned medicine should read "production of  the measured doses or in forms or packing for 
retail sale except by mere pressing of tablets or by me re encapsulation".  It is noted that no residual 
rule was proposed for 30.02. 
 
Chapter Residual Rule for goods of headings 30.03 and 30.04 
 
The proposed residual rule for goods of headings 30.03 and 30.04 produced by mixing or otherwise 
combining materials of different origins indicates that these goods originate in the country that 
produced the therapeutic or prophylactic material s (disregarding solvents and other non-active 
additives) that predominate by weight or volum e, as appropriate, over those of each other single 
country.  This would mean in practice that a medicament originating in Switzerland and filled there in 
a glass ampoule would have the origin of the glass  ampoule.  This only because glass is heavier than 
the medicament itself. Such Residual rule contra dicts in our mind with the concept of the last 
substantial processing step (substantial transformation).  Therefore, a rule of origin based exclusively 
on weight or volume should not be adopted. 
 
Chapter Residual rule - for goods of headings 30.03, 30.04, 30.02 – Swiss proposal 
 
We propose to amend point 1 of Chapter 30 residual rule as follows: 
 
“Goods of headings 30.03 and 30.04 produced by  mixing or otherwise combining materials of 
different origins originate in the country that produced the therapeutic or prophylactic materials 
(disregarding solvents and other non-active additives)  that predominate by weight or volume, or by 
total value of materials and related processing activ ity, as appropriate, over those of each other single 
country.” 
 
We propose to add the same residual rule for goods of 30.02. 
 
Chapter Residual rules for goods of Chapters 28 to 39 – Swiss proposal 
 
Taking into account the considerations mentioned in  the two last sentences of paragraph 6, we would 
also indicate that we still support the introduction of an alternative value criteria as appropriate in the 
Chapter Rules of the Chemical - Pharma ceutical sector (HS Chapters 28 - 39). 
 
 
• Switzerland would provide more scientific  explanation at the next meeting. 
 
• One delegation stated that the proposal needs to be looked at closely as there might be a 
difference between biotechnological process and tr aditional process.  It was also pointed out 
that the ampoules may not be considered as the th erapeutic or prophylactic materials.  A value 
criteria for the major portion rule should be more appropriate.  G/RO/M/54 
 Page 9 
 
 
  Chapters 31 and 32  
 
It was noted that Chapter Residual rules of Chapters 31 and 32 are similar to Rule 1(g) and that 
therefore there is no need for Rule 1(g) for these  chapters.  Members are requested to check the 
necessity of Rule 1(g) for these chapters.  Chapter 61 to 62
 
 
Once the materials of Chapter 50 to 60 are manufactu red to the materials of Chapter 61 to 62 by the 
process of cutting and sewing fabrics, the country where change of chapter is occurred should be 
considered as origin conferring.  Korea sugg ests deleting split chapter and apply CC criterion for 
overall chapters of 61 and 62.  
Subheading 64.06
 
 
• For the headings of 64.01 to 64.05, Korea s uggests deleting the expression of “except from split 
heading ex64.06(a)” and apply CTH criterion(or CT H; or 35% value added rule).  Given that 
footwear are manufactured largely depending on glob al sourcing of parts of footwear including 
ex64.06(a), and the portion of parts of footw ear is not excessive of 50%, manufacturing shoes 
from parts of footwear including ex64.06(a) crea tes considerable value added being regarded as 
a substantial transformation 
 
• Mexico proposed "CTH" instead of the Chair's proposal "CTHS" for split headings ex 6406(a)." 
 
• Egypt agreed and said it will come back to this, given the discussion today. 
 
Chapters rules of machinery (chapters 84-90)  
 
• One delegation questioned whether Subsidiary ru les should be located at Chapter level or 
Heading level. 
 
• For high-tech machines weight may not be a good criteria to be used for a major portion. 
 
• China made a new proposal as follows: 
 
 
1. Primary Rule A1:  Goods obtained by disassembly 
 
Since it has been provided in App2 rule 2(c)(i) th at “changes which result from disassembly” shall not 
be considered in determining the country of origin , for simplicity purpose, the sentence “A change of 
classification which results from the disassembly of goods shall not be considered as the change 
required by the rule set forth in the matrix” could be deleted.  
 
China presumes that the country of origin of th e parts recovered from the good should be different 
depending on the condition of the good itself, namely, whether or not capable of being restored or 
repaired. Therefore, China divided these two scenar ios and proposed the corresponding criteria.  
 
App 1 Definition 1(h) has already stipulated the rule  to determine the origin of parts “recovered from 
goods which can no longer perform their original purpose nor are capable of being restored or 
repaired”. In this case, paragraph 1 covers part s recovered from goods which can no longer perform 
their original purpose nor are capable of being restor ed or repaired, and the criterion remains the same 
as Definition 1(h). Since it is kind of duplication of  Definition 1(h), paragra ph 1 could be deleted. 
 G/RO/M/54 
Page 10  
 
   
Paragraph 2 covers parts recove red from goods which can perform their original purpose or are 
capable of being restored or repaired”. According to App2 Rule 2 (c)(i), disassembly is not considered 
to be origin conferring. So, China suggests that th e origin of “parts recovered from goods which can 
perform their original purpose or are capable of be ing restored or repaired” be the country where the 
parts themselves originated, provided  that verifiable evidence determining the origin of the parts is  
available. Otherwise, the country  of origin of the recovered pa rts shall be “countries unknown”. China 
puts the last sentence in square br ackets as a possible final solution. 
 
Since the term of App1 Rule 1(h) is not defined in the text, China suggests that the criteria for 
distinguishing whether a good is capable of being rest ored or repaired should be provided. China is of 
the view that a good is regarded as capable of bei ng restored or repaired provided that the good can 
fulfil or exceed its original function or precision afte r functional adjustment or part(s) replacement. If 
the cost of the functional adjustment or part(s) re placement exceeds [x%] of the total value of the 
good, the good is regarded as not capable of being restored or repaired. 
 
2. Recertification or retesting 
 
Change in classification solely due to recertification or retesting should be considered as an issue of 
classification, and should not be taken into account when determining the origin of the Goods. So 
China suggests the paragraph be deleted. 
 
3. Additional Primary Rules/Notes with regard to Column (3) 
 
In the overall architecture, there are only two kinds of  rules provided, Primary Rule and Residual Rule 
at the Chapter Level. Neither “Additional Primary Rule” nor how to apply such Additional Primary 
Rule is provided in overall architecture. To  introduce an “Additional Primary rule” will be 
inconsistent with the whole text, and will not only make the applications of HRO more complicated, 
but also lead to confusion. Furthermore, the excepti ons to apply this rule are quite similar to “Residual 
Rules/Notes for Chapters 84-90 app licable to rules contained in Co lumn (3)”. In this case, China 
suggests “Additional Primary Rule” be deleted a nd relative content be combined into “Residual 
Rules/Notes for Chapters 84-90 applicable  to rules contained in Column (3)”. 
 
4. “5 parts” rule in “additional primary rule(b)(1)” 
 
China is not clear how such a rule was determined . We all know that machinery products and their 
parts and accessories usually consist of hundreds of pa rts. In this case, “5 parts “rule might not be 
applicable. Therefore, China would like to propose “v alue criteria” instead of “5 parts” rule, taking 
into account the value of materials and the value added by the assembly 
 
5. Other parts of the Chapter Note remain unchanged. 
 
6. The whole text of Chapter notes of HS 84-90 proposed by China is as follows: 
 
A. Primary Rule/Note for Chapters 84-90  
 
(a) Goods obtained by disassembly 
 
[A change of classification which results from th e disassembly of goods shall not be considered 
as the change required by the rule set forth in the matrix.] 
  G/RO/M/54 
 Page 11 
 
 
   
[The country of origin of the parts recovere d from the goods that are not capable of being 
restored or repaired shall be the country where the parts are recovered, unless the importer, exporter 
or any person with a justifiable cause to determine the origin of parts demonstrates another country of 
origin on the basis of verifiable  evidence such as origin marks on the part itself or documents. ] 
The country of origin of the parts recovered from the goods that are capable of being restored or 
repaired shall be the country where the parts th emselves are originated, provided that verifiable 
evidence demonstrates the origin of the parts is available. [Otherwise, the country of origin of the 
recovered parts shall be “countries unknown”.] 
 
A good is regarded as capable of being restored or repaired provided that the good can fulfil or 
exceed its original function or precision after functio nal adjustment or part(s) replacement. If the cost 
of the functional adjustment or part(s) replacement  exceeds [x%] of the total value of the good, the 
good is regarded as not capable of being restored or repaired. 
 
(b)  Collection of parts  
 
Where a change in classification results from the application of HS General Interpretative Rule 
2(a) with respect to collections of parts that ar e presented as unassembled articles of another heading 
or subheading the individual parts shall retain  their origin prior to such collection.   
 
(c) Assembly of the collection of parts  
 
Goods assembled from a collection of parts classi fied as the assembled good by application of 
General Interpretative Rule 2 shall have origin in the country of assembly, provided the assembly 
would have satisfied the primary rule for the good ha d each of the parts been  presented separately and 
not as a collection. 
 
(d) Parts and accessories produced from blanks  
 
For the purposes of headings 84.80 and 84.83 and goods classifiable in provisions for parts or 
parts and accessories, including goods specifically na med under such provisions, the country of origin 
of goods that are produced from blanks which, by a pplication of the HS General Interpretative Rule 
2(a), are classified in the same heading or subhead ing as the complete or finished goods, shall be the 
country in which the blank was finished provided fini shing included configuring to final shape by the 
removal of material (other than merely by honing or polishing or both), or by forming processes such 
as bending, hammering, pressing or stamping. 
 
B. Primary Rule applicable to Subheadings 8471.50, 8471.60, 8471.70 and 8471.80  
 
For the purposes of subheadings 8471.50, 8471.60, 8471.70 and 8471. 80, the assembly of goods 
of those subheadings in the same housing with units of other subheadings within that group shall be 
origin conferring. 
 
C. Notes for Chapters 84-90 applicable to  primary rules contained in Column (4) 
 
 Application of the value added rule  
 
1. The term "x% value added rule" shall mean ma nufacture where the increase in value acquired 
as a result of working and processing, and if applicab le, the incorporation of parts originating in the 
country of manufacture represents at least x% of the ex-works price of the product.  
 G/RO/M/54 
Page 12  
 
   
2. The term "ex-works price" shall mean the pri ce to be paid for the product obtained to the 
manufacturer in whose undertaking the last working or processing is carried out (this price shall not 
include internal taxes which are, or may be , repaid when such product is exported); 
 
3. The term "value acquired as a result of working and processing and incorporation of parts 
originating in the country of manufacture" sha ll mean the increase in value resulting from the 
assembly itself, together with any preparatory,  finishing and checking operations, and from the 
incorporation of any parts originating in the count ry where the operations in question were carried 
out, including profit and the general costs borne in that country as a result of the operations; 
 
D. Residual Rules/Notes with regard to Column (3) 
  
The following shall be applied in sequence: 
[1 When the good is produced from materials or components that changed classification but did 
not satisfy the primary rule applicable to the good in matrix, the country of origin of the good is the 
country that furnished all or the major portion of those materials or components. 
For the purpose of the Goods classifiable under pr ovisions for “parts” or “parts and accessories” 
and which are not described by name in the Harmonized System, when the good is produced by the 
assembly of two or more parts, the country of origin shall be the country which contributes the major 
portion of the good calculated in value, including the value of materials and the value added by the 
assembly.  
 
The following parts shall not be c ounted for purposes of this rule:  
 
1. the attachment of machinery to a base;  
2. the installation of machinery or appara tus into cabinets or similar encasements; 
3. the attachment of parts of general use as  defined in Note 2 to Section XVI of the  
 Harmonized System or similar parts of plastic (Chapter 39); 
4. the attachment of handles, dials, knobs, hand cranks, and other consum er-operated  controls; 
5. the attachment of a power cord or change of mains voltage/frequency by adding  
 transformer, adapter or converter; 
6. the installation of batteries, accumulators, sensors, thermostats or other articles not  
 designed to become a permanent part of the good; 
7. the attachment of accessories or parts (incl uding printed circuits with components assembled 
 thereon), which serve only to enhance the operation of the machine or device; 
8. the addition of manuals, warranty cards, certif icates of conformance to standards (with  
 or without testing), or labels; 
9. washing, cleaning; removal of dust, oxide, oil, paint or other coverings; 
10. simple painting and polishing operations; 
11. affixing or printing marks, labels, logos a nd other distinguishing signs on products or   
 their packaging;  or 
12. the installation of software.] 
 
E. Criteria to apply Appendix 2, Rule  1(g) with regard to Column (3)  
 
The criteria to determine the major portion of the materials as set forth in Appendix 2, Rule 1(g) 
for Chapters 84-90 is value. 
 
 
• Delegations appreciated China for its valuable  contribution and exchanged preliminary views 
on the proposal.  Delegations would discuss this proposal at the next meeting after further 
considerations.  G/RO/M/54 
 Page 13 
 
 
  Split heading ex84.73(b), heading 85.41  
 Korea understands that [assembly] has been alread y agreed as the criterion in determining rules of 
origin for split heading ex84.73(b) and heading 85 .41 at the consultation of CRO in June 2007.  
Furthermore, memory modules of ex84.73(b) consist of eight integrated circuits which might have 
different origin of countries respectably.  Korea s uggests that a country of final assembling should be 
considered the country of origin as primary rule, an d, additionally, the country of origin will be the 
country of origin of the integrated circuits as subs idiary rule.  We also should take into account that 
most of the value added, around 70% to 80% of HS85.41 is produced from the process of assembly. 
 
Heading 85.42
 
 Korea is the opinion of that monolithic integrated circuits of HS85.42 should be considered as origin 
conferring according to the diffusion process as the mo st of value added are created from diffusion.  
Other products except monolithic integrated circ uits will be determined by assembly process.
 
 
2.2 The representative of Japan  suggested that the Secretariat hold another workshop on the 
progress of the Harmonization Work Programme as well as on machinery.  2.3 The CRO took note
 of the statements. 
 III. ELECTION OF OFFICERS 
3.1 The CRO elected
 Ms. Jasmine QUAH ZUBAIR (Singapore) as Chairperson. 
 
IV. DATES FOR THE NEXT MEETINGS 
4.1 The Chairperson  suggested dates of the next meeting of the CRO be set in consultation with 
delegations. 
 
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