Determining the RCEP Country of Origin(As of February 2022)

Claiming preferential tariff rates under the RCEP Agreement requires the importer to both confirm whether a given good intended
for import is treated as an originating good as stipulated in Chapter 3 (Rules of Origin) and determine an RCEP Country of Origin.

RCEP Country of Origin
Claiming preferential tariff rates under the RCEP Agreement requires the importer to both identify the Party in which a
good obtained its originating status as stipulated in Chapter 3 (Rules of Origin) and to separately identify an RCEP Countryof Origin in accordance with the provisions of Article 2.6.

If an importing Party has stipulated multiple tariff rates that differ by an exporting Party (tariff differentials) for a given
good intended for import, the tariff rate applied is determined by an RCEP Country of Origin.
(An excerpt from the Tariff Schedule (January 2022version) posted on the Japan Customs website.)

Example of a tariff differential
Statistical code

Tariff rate

Tariff rate (EPA)

Description
H.S.code

General64.03

WTO

ASEAN/Australia/New
Zealand(RCEP)

China (RCEP)

Korea (RCEP)

Footwear with outer soles of rubber,plastics, leather or composition
leather and uppers of leather.
Other footwear with outer soles ofleather :6403.99

Other
1 Footwear with outer solesof rubber or composition
leather (excluding Slippers
and other house footwear)(2) Other

27%

(27%)

60% or 4,800
yen/pair,whichever isthe greater- Other-- With an insole over
19cm015--- For men

30% or 4,300
yen/pair,whichever isthe greater
20.3%

20.6%

(Blank cells without any tariff rates indicate that no concessions have been granted therefor.)
The RCEP Country of Origin is one of the minimum information requirements for Proof of Origin (i.e., Certificate of Origin,
Declaration of Origin (DO) by Approved Exporters, DO by Exporters/Producers and DO by Importers) stipulated under theRCEP Agreement.
If tariff differentials apply to a good intended for import, the tariff rate applied to that good is the tariff rate listed for theParty indicated as the RCEP Country of Origin on the Proof of Origin*.
*Importers may, however, select to claim either of the following tariff rates irrespective of the tariff rate listed for theParty indicated as the RCEP Country of Origin:
the highest tariff rate applicable to the same good from any of the Parties contributing originating materials used in
the production of the good, (Article 2.6. 6(a)), orthe highest rate applicable to the same good from any of the Parties (Article 2.6.6 (b)).

Although in many cases the Party where the good acquired its originating status will be identical to the RCEP Country ofOrigin, there are exceptions. A good treated as an originating good of Vietnam in accordance with Chapter 3 of theAgreement may, upon application of the relevant provisions of Article 2.6 of the Agreement, be determined to be a goodwhose RCEP Country of Origin is China. This determination, however, has no impact on the good’s acquisition oforiginating status in Vietnam. (*Refer to pages 4 and 5 for detailed examples.）1Tariff differentials
The term tariff differential refers to instances where the tariff rates applied to an originating good under the RCEP Agreement
differ by tariff classification and exporting Party. The footnote for Article 2.6.1 of the RCEP Agreement defines tariff differentials
as “different tariff treatment that an importing Party applies for the same originating good.”
Japan has stipulated three groupings of tariff rates for imports into Japan:
1. ASEAN/Australia/New Zealand
2. China
3. Korea
Approximately 2,700 tariff lines (subdivisions) are subject to tariff differentials.
Intent of the rules concerning tariff differentials
As the applicable tariff rate for the goods subject to tariff differentials differs by the Party where the final good acquires
originating status, this creates opportunities for circumvention: the act of intentionally importing goods via a Party subject tolower tariff rates. The stipulations contained in Article 2.6 of the RCEP Agreement are intended to prevent such acts.
When an originating good intended for import is subject to a tariff differential, the tariff rate stipulated for its RCEP Country ofOrigin will be applied (unless a claim is made using option (4) below). The rules concerning tariff differentials rules are also
used to determine the RCEP Country of Origin.

Determination of the RCEP Country of Origin
The RCEP Country of Origin of an originating good is to be determined after confirming the originating status of thegood as prescribed in Article 3.2 of the Agreement.
Rules used in the determination:(1)
Originating goods identified in the Appendix to Japan’s Schedule of Tariff Commitments (Article 2.6.3)
The RCEP Country of Origin for originating goods identified in the Appendix shall be the exporting Party, provided that no lessthan 20% of the total value of the originating good has been added in the exporting Party.
♦ Supporting evidence: Documents that enable confirmation of the value added during the production of the good in
the Party where the good acquired its originating status in accordance with Chapter 3.
Documents indicating the value of any non-originating materials and the FOB value of the good (e.g., manufacturing
cost statements, commercial invoices or payment records) are required when said calculations are conducted using theIndirect/Build-Down Formula stipulated under Article 3.5.1 (a).
(2)
Originating goods not identified in the Appendix (Article 2.6.2)
The RCEP Country of Origin for originating goods not identified in the Appendix shall generally be the Party where the goodacquired originating status (i.e., the exporting Party). Notwithstanding the above, however, the RCEP Country of Origin for
originating goods produced exclusively from originating materials, as prescribed in Article 3.2 (b) of the Agreement, is theParty where the good acquired originating status, provided that production processes other than the minimal operations
defined in Article 2.6.5 were undertaken in the Party where the good acquired originating status.
♦ Supporting evidence: Documents that enable confirmation of any production processes occurring in the Party wherethe good acquired originating status (e.g., production flowcharts, production instructions, etc.)(3)

Originating goods whose RCEP Country of Origin cannot be determined through rules (1) or (2) (Article 2.6.4)
If consideration under rule (1) ; fails due to an added value of less than 20%, or (2) the fact that only minimal operations
were conducted in the exporting Party, respectively, then the RCEP Country of Origin shall be the party that contributed thehighest value of originating materials used in the production of the good in the exporting Party.
♦ Supporting evidence: Documents that enable confirmation of the Parties that contributed the originating materials
used in production in the Party where the good acquired its originating status as well as the value of these materials(e.g., Certificates of Origin for the materials, manufacturing cost statements, commercial invoices, payment records)(4)

Selection by the importer (Article 2.6.6)
Notwithstanding the above, importers may make a claim for preferential tariff treatment at one of the following tariff rates:(a) the highest tariff rate that the importing Party applies to the same originating good from any of the Parties contributingoriginating materials used in the production of the good(b) the highest tariff rate that the importing Party applies to the same originating good from any of the Parties2

■ Key steps in confirming the RCEP Country of Origin in relation to goods intended for import into Japan

Step 1: Identify the 9-digit tariff line of the good intended for import.
⇒ Importers may obtain information regarding tariff classifications by utilizing the Advance Ruling system.
https://www.customs.go.jp/english/advance/classification.htm
Step 2: Confirm that a tariff rate for the good has been stipulated for the exporting Party.
⇒ This can be accomplished by utilizing the 9-digit tariff line identified in Step 1 in combination with the tariff schedule ofJapan (available on the Japan Customs website).
https://www.customs.go.jp/english/tariff/index.htm
Step 3: Confirm that the good is an originating good in accordance with Chapter 3 of the RCEP Agreement.
⇒ Importers may obtain information regarding Country of Origin by utilizing the Advance Ruling system.
https://www.customs.go.jp/english/advance/origin.htm
Step 4: Use the Flow chart provided below to determine the RCEP Country of Origin.
■ Flow chart for determining the RCEP Country of Origin
Is the good recognized as an originating good in accordance with Chapter 3?
And is the good identified in the Appendix as well?
Yes
Was more than 20% of the total value of thegood added through production in the final
exporting Party?
Yes
Exporting Party(Article 2.6.3)

No
Under which of the following criterion is the good treated as anoriginating good?① Wholly obtained (WO); ② Produced Exclusively fromoriginating materials (PE); or ③ Satisfying Product Specific Rules (PSR)

No① or ③

Party that contributed thehighest value of originating
materials

Exporting Party(Article 2.6.2)(Article 2.6.4)(Article 2.6.5) *“minimal operation” is any operation set out below:(a)preserving operations to ensure that the good remains in good condition for thepurposes of transport or storage;(b) packaging or presenting goods for transportation or sale;(c) simple processes, consisting of sifting, screening, sorting, classifying, sharpening,
cutting, slitting, grinding, bending, coiling, or uncoiling;(d) affixing or printing of marks, labels, logos, or other like distinguishing signs on goods ortheir packaging;(e) mere dilution with water or another substance that does not materially alter thecharacteristics of the good;(f) disassembly of products into parts;(g) slaughtering5 of animals;(h) simple painting and polishing operations;(i) simple peeling, stoning, or shelling;(j) simple mixing of goods, whether or not of different kinds; or(k) any combination of two or more operations referred to in subparagraphs (a) through (j).

②Was a manufacturing processexceeding that defined as minimal
operations* conducted in theexporting Party?

Yes
Exporting Party(Article 2.6.2)

No
Party that contributed thehighest value of originatingmaterials(Article 2.6.4)

The importer may select between either the highest tariff rate applicable to the same good from any of the Parties contributingoriginating materials used in the production of the good (Article 2.6. 6(a)) or the highest rate applicable to the same good fromany of the Parties (Article 2.6.6 (b)).
● In many cases, the Party where the good acquired originating status is identical to the RCEP Country of Origin.
■ Indicating the RCEP Country of Origin on the Proof of Origin

If utilizing the third-party certification system, Approved Exporter Self-Certification (Self-Declaration), or exporter/producer
Self-Certification (Self-Declaration) system:→ The RCEP Country of Origin will be indicated on the Proof of Origin issued by or prepared in the exporting Party.

If utilizing the importer Self-Certification (Self-Declaration) system:→ The importer is required to identify and list the RCEP Country of Origin on the Declaration of Origin. Importers unable toobtain the requisite information from the exporter are advised to consider the use of other certification systems.

*Instructions for requesting an advance ruling on the RCEP Country of Origin may be found on the Japan Customs website.
http://www.customs.go.jp/roo/information/rcep/exp_oshirase.html

3

Example 1. Originating goods identified in the Appendix
In the case of importing casual shoes manufactured in Vietnam to Japan:

Description: Footwear for men(casual shoes)
HS code:6403.99-015
Manufacturing process:Production of shoes in Vietnam using
originating materials of China, originatingmaterials of Australia and non-originatingmaterials.

Originating materials$100

Originating
materials$150

Production
RCEP Parties

Key factor to consider•

Whether a more than 20% of the total value oforiginating good was added through production in
the exporting Party.

● Confirmation of the preferential tariff rates in the
Tariff Schedule

ImportNon-originating
materials: $60

Obtains
originating
status inVietnam

Non-PartyＸ(January 2022version）

Statistical code

*Cell for Korea is left blank because there areno concessions therefor.

Tariff rate

Tariff rate (EPA)

Description
H.S.codeGeneral

64.03

ASEAN/Australia/New
Zealand (RCEP)WTO

China (RCEP)

Korea (RCEP)

Footwear with outer soles of rubber, plastics, leather orcomposition leather and uppers of leather.
Other footwear with outer soles of leather :6403.99

Other
1 Footwear with outer soles of rubber or composition
leather (excluding Slippers and other house footwear)(2) Other27%

ASEAN/Australia/New Zealand: 20.3%
China: 20.6%
Korea: No concession(27%)

60% or 4,800 yen/pair,whichever is the greater- Other-- With an insole over 19cm

015

30% or 4,300 yen/pair,whichever is the greater--- For men

20.3%

20.6%

● Calculation of value added during production (conducted in accordance with the provisions of Article 3.5 with necessarymodifications)(Indirect/Build-Down Formula)

FOB value - (150＋100+60)

Calculation of added value by the exporting Party=

FOB value

x 100NB) In the case of calculating added value to determine the RCEP Country of Origin, notwithstanding the provisions ofcumulation (Article 3.4), originating materials of other Parties are deemed as non-originating materials.
● If the added value in Vietnam...
A: Equals or is greater than 20% of the value of the good
Vietnam is the RCEP Country of Origin(The Party where the good obtained originating status.)

B: Is less than 20% of the value of the good
China is the RCEP Country of Origin(The Party that contributed the highest value of originating
materials used in the production of the good.)● If Article 2.6.6 is selected...

a.

Apply the highest tariff rate among the Parties
that contributed the originating materials➡ Chinab.

The highest tariff rate among all Parties:➡ Korea(Since no concessions have been made toKorea, the preferential tariff rates available
under the RCEP agreement are not applicable.)4

Example 2: Originating goods not identified in the Appendix
In the case of importing carpets manufactured in Vietnam to Japan:
Description: Carpets(Of wool or fine animal hair)
HS code:5701.10-000
Manufacturing process:Production of carpets in Vietnam utilizing
originating materials of China and originating
materials of Thailand

Originating materials＄100

Originating
materials＄150

Production

Key factors to consider
Whether the good is subject to tariff differentials
If good is produced exclusively from originating
materials, whether the operations conducted in theexporting Party exceed the scope of the minimal
operations defined in Article 2.6.5.

ImportRCEP Parties● Confirmation of the preferential tariff rates in the Tariff Schedule
Statistical code

(January 2022 version）

Tariff rate

Tariff rate (EPA)

Description
H.S.code

GeneralWTO

ASEAN/Australi
a/New Zealand(RCEP)

China (RCEP)

Korea (RCEP)

7.2%

Free

Carpets and other textile floor coverings,
knotted, whether or not made up

57.01
5701.10

Obtains
originating
status inVietnam
A goodproducedexclusivelyfrom
originating
materials.

000Of wool or fine animal hair

9.6%

7.9%

Free

● Confirm whether any production processes undertaken in Vietnam are beyond the scope of minimal operations.
(Refer to Article 2.6.5 for details.)(Article 2.6.5) *“minimal operation” is any operation set out below:(a) preserving operations to ensure that the good remains in good condition for the purposes of transport or storage;(b) packaging or presenting goods for transportation or sale;(c) simple processes, consisting of sifting, screening, sorting, classifying, sharpening, cutting, slitting, grinding, bending,coiling, or uncoiling;(d) affixing or printing of marks, labels, logos, or other like distinguishing signs on goods or their packaging;(e) mere dilution with water or another substance that does not materially alter the characteristics of the good;(f) disassembly of products into parts;(g) slaughtering5 of animals;(h) simple painting and polishing operations;(i) simple peeling, stoning, or shelling;(j) simple mixing of goods, whether or not of different kinds; or(k) any combination of two or more operations referred to in subparagraphs (a) through (j).
● If the production process in Vietnam...

● If Article 2.6.6 is elected...

A: Exceeds minimal operations
Vietnam is the RCEP Country of Origin(The Party where the good obtained originating status.)

B: Does not exceed minimal operations
China is the RCEP Country of Origin(The Party that contributed the highest value of originating
materials used in the production of the good.)a.

Apply the highest tariff rate among the Parties
that contributed the originating materials➡ Chinab.

Apply the highest tariff rate among all Parties➡ China5