Annex II
Referred to in Chapter 2
Rules of Origin

325

Annex II
Referred to in Chapter 2
Rules of origin

Table of Contents
Section 1
Article I

General Provisions
Definitions

Section 2
Article II
Article III
Article IV
Article V
Article VI
Article VII
Article VIII
Article IX
Article X
Article XI
Article XII

Concept of "Originating Products"
Originating Products
Wholly Obtained Products
Sufficiently Worked or Processed Products
Accumulation of Origin
Tolerance
Non-Qualifying Operations
Unit of Qualification
Unassembled or Disassembled Product
Accessories, Spare Parts and Tools
Neutral Elements
Accounting Segregation

Section 3
Article XIII
Article XIV

Territorial Requirements
Principle of Territoriality
Consignment Criteria

Section 4
Article XV
Article XVIArticle XVII

Certification of Origin
Proof of Origin
Certificate of Origin
Certificate of Origin Issued
Retrospectively
Issuance of a Duplicate Certificate ofOriginOrigin Declaration
Validity of Proof of Origin
Claim for Preferential Tariff Treatment
Supporting Documents
Preservation of Documents and Records

Article XVIII
Article XIX
Article XX
Article XXI
Article XXII
Article XXIII

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Section 5

Arrangements for Administrative
Cooperation
Article XXIV
Notifications
Article XXV
Verification of Proofs of Origin
Article XXVI
Confidentiality
Article XXVII Penalties and Measures against Fraudulent
Act
Article XXVIII Operational Procedures
Article XXIX
Miscellaneous

Section 6
Article XXX
Article XXXIAppendices
Appendix 1
Appendix 2
Appendix 3

Final Provisions
Sub-Committee on Rules of Origin, Customs
Procedures and Trade Facilitation
Transitional Provisions for Products inTransit or Storage

Product Specific Rules
Specimen of Certificate of Origin
Text of the Origin Declaration

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Section 1
General Provisions

Article I
Definitions
For the purposes of this Annex,(a) “chapter,” “heading” and “subheading” of theHarmonized System respectively means a chapter (thefirst two-digit code in tariff classification number),a heading (the first four-digit code in tariffclassification number) and a subheading (the sixdigit code in tariff classification number) of theHarmonized System;(b) “competent governmental authority” means theauthority that, according to the legislation of eachParty, is responsible for the issuance of a
Certificate of Origin or for the designation ofcertification entities or bodies, for theauthorisation of approved exporters referred to in
Article XIX of this Annex and for the verification of
proofs of origin referred to in Article XXV of thisAnnex. In the case of Japan, it shall be the Ministryof Economy, Trade and Industry, and in the case of
Switzerland, the Federal Customs Administration;(c) “customs authority” means the authority that,
according to the legislation of each Party or nonParty, is responsible for the administration andenforcement of customs laws and regulations of theParty or the non-Party. In the case of Japan, it
shall be the Ministry of Finance, and in the case of
Switzerland, the Federal Customs Administration;(d) “exporter” means a person located in the customs
territory of an exporting Party who exports products
from the customs territory of the exporting Party;328

(e) “ex-works price” means the price paid for the productex-works to the producer located in the customs
territory of a Party in whose undertaking the lastworking or processing is carried out, provided thatthe price includes the value of all the materials
used, wage and any other cost, and profit minus any
internal taxes returned or repaid when the productobtained is exported;(f) “factory ships of the Party” or “vessels of theParty” respectively means factory ships or vessels:(i)which are registered in the customs territory of
the Party;(ii)

which sail under the flag of the Party;(iii)

which are owned to an extent of at least 50 per
cent by nationals of the Parties, or by ajuridical person with its head office in thecustoms territory of either Party, of which therepresentatives, chairman of the board of
directors, and the majority of the members ofsuch board are nationals of the Parties, and ofwhich at least 50 per cent of the equity
interest is owned by nationals or juridical
persons of the Parties;(iv)

of which the master and officers are allnationals of the Parties; and(v)of which at least 75 per cent of the crew arenationals of the Parties;329

(g) “generally accepted accounting principles” means therecognised consensus or substantial authoritative
support within the customs territory of a Party at aparticular time as to which economic resources andobligations should be recorded as assets andliabilities, which changes in assets and liabilities
should be recorded, how the assets and liabilities
and changes in them should be measured, what
information should be disclosed and how it should be
disclosed, and which financial statements should be
prepared. These standards may be broad guidelines ofgeneral application or detailed practices andprocedures;(h) “importer” means a person who imports products into
the customs territory of the importing Party;(i) “material” means a product that is used in the
production of another product;(j) “non-originating material” means a material which
does not qualify as an originating product under thisAnnex;(k) “preferential tariff treatment“ means the rate ofcustoms duties applicable to originating products ofa Party in accordance with paragraph 1 of Article 15;and(l) “production” means a method of obtaining products
including manufacturing, assembling, processing,raising, growing, breeding, mining, extracting,harvesting, fishing, trapping, gathering, collecting,hunting and capturing.

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Section 2
Concept of “Originating Products”

Article II
Originating Products
For the purposes of this Agreement, the following products
shall be considered as originating products of a Party:(a) products wholly obtained in the customs territory of
the Party, as defined in Article III of this Annex;(b) products obtained in the customs territory of theParty using non-originating materials, provided thatsuch materials have undergone sufficient working orprocessing in the customs territory of the Party
within the meaning of Article IV of this Annex; and(c) products obtained in the customs territory of theParty exclusively from materials that qualify as
originating products of the Party pursuant to thisAnnex.

Article III
Wholly Obtained Products
For the purposes of subparagraph (a) of Article II of thisAnnex, the following shall be considered as wholly obtained in
the customs territory of a Party:(a) live animals born and raised in the customs territoryof the Party;(b) animals obtained by hunting, trapping, fishing,gathering or capturing in the customs territory of
the Party;(c) products obtained from live animals in the customs
territory of the Party;331

(d) plants or plant products harvested, picked orgathered in the customs territory of the Party;(e) minerals and other naturally occurring substances,which are not included in subparagraphs (a) to (d),extracted or taken in the customs territory of theParty;(f) products of sea-fishing and other products taken by
vessels of the Party from the sea outside theterritorial seas of the Parties;(g) products produced on board factory ships of the Party,
outside the territorial seas of the Parties, from theproducts referred to in subparagraph (f);(h) products taken from the sea-bed or subsoil thereof
outside the territorial sea of the Party, provided
that the Party has rights to exploit such sea-bed or
subsoil under the provisions of the United Nations
Convention on the Law of the Sea, done at Montego Bay
on 10 December 1982;(i) articles collected in the customs territory of theParty which can no longer perform their original
purpose in the customs territory of the Party nor arecapable of being restored or repaired and which are
fit only for disposal or for the recovery of parts or
raw materials;(j) scrap and waste derived from manufacturing orprocessing operations or from consumption in thecustoms territory of the Party and which are fit only
for disposal or for the recovery of raw materials;(k) parts or raw materials recovered in the customs
territory of the Party from articles which can nolonger perform their original purpose nor are capableof being restored or repaired; and332

(l) products obtained in the customs territory of theParty exclusively from products referred to in
subparagraphs (a) to (k).

Article IV
Sufficiently Worked or Processed Products
1. For the purposes of subparagraph (b) of Article II of thisAnnex, a product obtained using non-originating materials
shall be considered as an originating product of a Party, if:(a) the value of non-originating materials used in the
production of the product does not exceed 60 per centof the ex-works price of the product; or(b) all non-originating materials used in the productionof the product have undergone in the customs
territory of the Party, a change in tariffclassification at the level of the first four-digit
code of the Harmonized System.
2. Notwithstanding paragraph 1, a product of which the tariffclassification number of the Harmonized System is listed inAppendix 1 to this Annex shall be considered as an originatingproduct of a Party if it satisfies the product specific rules
set out therein.
3. For the purposes of paragraphs 1 and 2, the operations
provided for in Article VII of this Annex shall be considered
as insufficient.
4. For the purposes of paragraphs 1 and 2, the value of nonoriginating materials used in the production of the product in
the customs territory of a Party:(a) shall be determined in accordance with the Agreement
on Customs Valuation and shall include freight,
insurance and, where appropriate, packing and allother costs incurred in transporting the nonoriginating materials to the importation port in thecustoms territory of the Party where the producer ofthe product is located; or333

(b) if such value is unknown and cannot be ascertained,
shall be the first ascertainable price paid for the
non-originating materials in the customs territory of
the Party, but may exclude all costs incurred in that
customs territory in transporting the non-originating
materials from the warehouse of the supplier of thatmaterial to the place where the producer is locatedsuch as freight, insurance and packing costs as wellas any other known and ascertainable cost incurred inthat customs territory.
5. For the purposes of subparagraph 4(a), in determining thevalue of non-originating materials, the Agreement on Customs
Valuation shall apply mutatis mutandis to domestic acquisitionof the non-originating materials including domestictransactions.
6. For the purposes of calculating the value of nonoriginating materials used in the production of a product indetermining whether the product qualifies as an originatingproduct of a Party, the value of non-originating materials of
the product shall not include the value of non-originating
materials used in the production of materials qualified asoriginating products of the Party which are used in the
production of the product.
7. For the purposes of paragraphs 1 and 2, the production
carried out at different stages by one or more producers
within the customs territory of a Party may be taken into
account.
8. For the purposes of this Article, “Harmonized System” isthat on which the product specific rules set out in Appendix 1
to this Annex are based.

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Article V
Accumulation of Origin
1. Notwithstanding Article II of this Annex, an originatingproduct of a Party which is used as a material in the
production of a product in the customs territory of the otherParty may be considered as an originating product of that
other Party.
2. Originating products of a Party which are exported fromthe customs territory of one Party to the customs territory of
the other Party shall retain qualification as originatingproducts if:(a) such originating products are exported in the same
condition as they were when they were imported into
the customs territory of the exporting Party; or(b) such originating products have not undergone in thecustoms territory of the exporting Party working orprocessing beyond the operations referred to in
Article VII of this Annex.

Article VI
Tolerance
1. Except as otherwise provided for in Appendix 1 to thisAnnex, a product obtained using non-originating materials thathave not undergone the required change in tariffclassification shall be considered as an originating productof a Party if:(a) for a product classified under chapters 1 to 24 of
the Harmonized System, the value of all nonoriginating materials used in its production thathave not undergone the required change in tariffclassification does not exceed seven per cent of the
ex-works price of the product;335

(b) for a product classified under chapters 25 to 49 or
64 to 97 of the Harmonized System, the value of all
non-originating materials used in its production thathave not undergone the required change in tariffclassification does not exceed ten per cent of the
ex-works price of the product; or(c) for a product classified under chapters 50 to 63 of
the Harmonized System, the weight of all nonoriginating materials used in its production thathave not undergone the required change in tariffclassification does not exceed seven per cent of thetotal weight of the product; andprovided that the product meets all other applicableconditions for qualifying as an originating product set out inthis Annex, including Article VII of this Annex.
2. The value of non-originating materials referred to inparagraph 1 shall, however, be taken into account incalculating the value of non-originating materials used in the
production of the product.

Article VII
Non-Qualifying Operations
1. The following operations shall be considered as
insufficient working or processing to qualify a product as an
originating product of a Party, whether or not therequirements of paragraphs 1 and 2 of Article IV of this Annex
are satisfied:(a) preserving operations to ensure that the productremains in good condition during transport andstorage, such as drying, freezing, keeping in brineand other similar operations;(b) changes of packing and breaking-up and assembly of
packages;(c) washing, cleaning and removal of dust, oxide, oil,paint or other coverings;
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(d) simple painting and polishing operations;(e) sharpening, simple grinding or simple cutting;(f) sifting, screening, sorting, classifying, grading or
matching, including the making-up of sets ofarticles;(g) simple placing in bottles, cans, flasks, bags, cases
or boxes, simple fixing on cards or boards and allother simple packaging operations;(h) collection of parts and components classified as a
product pursuant to Rule 2(a) of the General Rules
for the Interpretation of the Harmonized System;(i) affixing or printing marks, labels, logos and otherlike distinguishing signs on products or theirpackaging;(j) simple mixing of products, whether or not ofdifferent kinds;(k) simple assembly of parts of articles to constitute acomplete article or disassembly of products into
parts;(l) ironing or pressing of textiles;(m) husking, partial or total bleaching, polishing andglazing of cereals and rice;(n) operations to colour sugar or form sugar lumps;(o) peeling, stoning and shelling of fruits, nuts andvegetables;(p) slaughter of animals; and(q) a combination of two or more operations referred toin subparagraphs (a) to (p).

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2. For the purposes of paragraph 1, all operations carriedout in the customs territory of a Party on the product shallbe taken into account together.
3.

For the purposes of this Article:(a) an operation is described as “simple” if neither
special skills nor machines, apparatus or equipment
especially produced or installed for carrying it out
are needed;(b) “simple mixing” means an operation of mixing whichneeds neither special skills nor machines, apparatus
or equipment especially produced or installed forcarrying it out. However, simple mixing does notinclude chemical reaction. “Chemical reaction” meansa process, including a biochemical process, which
results in a molecule with a new structure bybreaking intramolecular bonds and by forming new
intramolecular bonds, or by altering the spatial
arrangement of atoms in a molecule; and(c) “simple assembly” means an operation of assemblingparts of articles without special skills, machines,
apparatus or equipment especially produced or
installed for carrying it out. Such operation does
not include testing or inspection.

Article VIII
Unit of Qualification
1. In applying the provisions of this Annex, the unit ofqualification shall be the particular product which isconsidered as the basic unit when determining classification
under the Harmonized System. Accordingly, it follows that:(a) when a product composed of a group or assembly ofarticles is classified under a single tariff line,
the whole constitutes the unit of qualification; and338

(b) when a consignment consists of a number of identicalproducts classified under a single tariff line, eachproduct shall be taken individually into account indetermining whether it qualifies as an originatingproduct of a Party.
2. With respect to packaging materials and containers thatare used for retail sale of a product:(a) in determining whether all the non-originating
materials used in the production of the product haveundergone the applicable change in tariffclassification or a specific manufacturing orprocessing operation set out in Appendix 1 to thisAnnex, packaging materials and containers for retailsale, which are classified with the product pursuant
to Rule 5 of the General Rules for the Interpretationof the Harmonized System, shall be disregarded; and(b) in calculating the value of non-originating materials
used in the production of the product, packaging
materials and containers that are used for retailsale shall be considered as materials of the product.
3. Packing materials and containers for shipment that areused to protect a product during transportation shall be
disregarded in determining whether the product qualifies as an
originating product of a Party.

Article IX
Unassembled or Disassembled Product1. Where a product satisfies the requirements of the relevant
provisions of Articles II to VIII of this Annex and isimported into the customs territory of a Party from thecustoms territory of the other Party in an unassembled ordisassembled form but is classified as an assembled productpursuant to Rule 2(a) of the General Rules for theInterpretation of the Harmonized System, such product shall beconsidered as an originating product of the other Party.

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2. A product assembled in the customs territory of a Party
from unassembled or disassembled materials, which were
imported into the customs territory of the Party andclassified as an assembled product pursuant to Rule 2(a) of
the General Rules for the interpretation of the Harmonized
System, shall be considered as an originating product of theParty, provided that it would have satisfied the applicablerequirements of the relevant provisions of Articles II to VIIIof this Annex if each of the non-originating materials among
the unassembled or disassembled materials had been imported
into the customs territory of the Party separately and not in
an unassembled or disassembled form.

Article X
Accessories, Spare Parts and Tools
1. In determining whether all the non-originating materials
used in the production of a product have undergone theapplicable change in tariff classification or a specificmanufacturing or processing operation set out in Appendix 1 tothis Annex, accessories, spare parts or tools delivered withthe product and that form part of its standard accessories,
spare parts or tools, shall be disregarded, provided that:(a) the accessories, spare parts or tools are notinvoiced separately from the product, whether or notthey are separately described in the invoice; and(b) the quantities and value of the accessories, spareparts or tools are customary for the product.
2. In calculating the value of non-originating materials usedin the production of a product, accessories, spare parts ortools shall be considered as materials of the product.

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Article XI
Neutral Elements
In order to determine whether a product qualifies as an
originating product of a Party, it shall not be necessary to
determine the origin of the following elements used in its
production:(a) fuel and energy;(b) plant and equipment;(c) machines, tools, dies and moulds; and(d) any other materials that are not physicallyincorporated or which are not intended to enter into
the final composition of the product.

Article XII
Accounting Segregation
1. Where identical and interchangeable originating and nonoriginating products are used as materials in the productionof another product, those products shall be physicallysegregated during storage.
2. For the purposes of this Article, “identical andinterchangeable originating and non-originating products”
means originating products of a Party and non-originatingproducts used as materials being of the same kind andcommercial quality, having the same technical and physicalcharacteristics, and which, once they are incorporated intoanother product, cannot be distinguished from one another fororigin purposes by virtue of any markings or other means.
3. A producer having considerable costs or technicaldifficulties in keeping separate stocks of identical andinterchangeable originating and non-originating products usedin the production of a product may use the so-called“accounting segregation” method for managing stocks.

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4. The “accounting segregation” method shall be recorded,
applied and maintained in accordance with generally accepted
accounting principles applicable in the customs territory of
the Party in which the product is produced. The method chosen
shall:(a) permit a clear distinction to be made between
originating and non-originating products acquired or
kept in stock; and(b) guarantee that no more products receive qualification
as originating products of a Party than would be thecase if the identical and interchangeable originating
and non-originating products used as materials had
been physically segregated.
5. A Party may require that the application of the method for
managing stocks as provided for in this Article be subject toprior authorisation.

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Section 3
Territorial Requirements

Article XIII
Principle of Territoriality
1. Except as provided for in paragraph 1 of Article V of thisAnnex, the conditions for qualification as an originatingproduct of a Party set out in Section 2 shall be fulfilled in
the customs territory of the Party without interruption.
2. Where originating products of a Party exported from thecustoms territory of a Party to a non-Party return to thecustoms territory of the Party, they shall be considered as
non-originating, unless it can be demonstrated to thesatisfaction of the competent governmental authority of theParty that:(a) the returning products are the same as thoseexported; and(b) the returning products have not undergone any
operation other than splitting up of the consignment,
and unloading, reloading and any other operation
designed to preserve them in good condition while
being outside the customs territory of the Party.

Article XIVConsignment Criteria
1. An originating product of a Party shall be deemed to meetthe consignment criteria when it is:(a) transported directly from the customs territory of
the exporting Party; or343

(b) transported through one or more non-Parties for the
purpose of transit or temporary storage in warehouses,
provided that it does not undergo operations otherthan splitting up of the consignment, and unloading,reloading and any other operation designed topreserve it in good condition.
2. Notwithstanding Article II of this Annex, if an
originating product of a Party does not meet the consignment
criteria referred to in paragraph 1, it shall not be
considered as an originating product of the Party.

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Section 4
Certification of Origin

Article XV
Proof of Origin
For the purposes of this Annex, the following documents
shall be considered as proofs of origin:(a) a Certificate of Origin referred to in Article XVI ofthis Annex; and(b) an origin declaration referred to in Article XIX of
this Annex.

Article XVICertificate of Origin
1. A Certificate of Origin shall be issued by the competent
governmental authority of the exporting Party on application
having been made in writing by the exporter or, under theexporter's responsibility, by his authorised representative.
2. For the purposes of this Article, the competent
governmental authority of the exporting Party may designate,under the authorisation given in accordance with theapplicable laws and regulations of that Party, other entities
or bodies for the issuance of a Certificate of Origin.
3. Each Party shall establish its form for the Certificate ofOrigin, which shall conform to the specimen provided inAppendix 2 to this Annex. The Certificate of Origin shall becompleted in English by the exporter or his authorised
representative in accordance with the laws and regulations of
the exporting Party.

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4. The exporting Party shall ensure that the exporter
applying for the issuance of a Certificate of Origin for a
product is prepared to submit at any time, at the request of
the competent governmental authority of the exporting Party or
its designees which issue the Certificate of Origin, allappropriate documents proving that the product qualifies as an
originating product of a Party.
5. Where the exporter of a product is not the producer of the
product in the customs territory of the exporting Party, theexporter may request a Certificate of Origin in accordancewith the laws and regulations of the exporting Party on thebasis of:(a) a declaration given by the exporter to the competent
governmental authority of the exporting Party or its
designees based on the information provided by the
producer of the product;(b) a declaration voluntarily given by the producer ofthe product directly to the competent governmental
authority of the exporting Party or its designees at
the request of the exporter; or(c) a declaration given to the exporter by another person,
as provided for in the applicable laws andregulations of the exporting Party.
6. A Certificate of Origin for a product shall be issued by
the competent governmental authority of the exporting Party or
its designees if the product can be considered as an
originating product of a Party.
7. The competent governmental authority of the exporting
Party or its designees shall take any steps necessary toverify the qualification of the products as originatingproducts of a Party. They shall also ensure that the form
referred to in paragraph 3 is duly completed. In particular,
they shall check whether the space reserved for thedescription of the products has been completed in such amanner as to exclude all possibility of fraudulent additions.

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8. The exporting Party shall ensure that the exporter to whoma Certificate of Origin for a product has been issued, or the
producer referred to in subparagraph 5(b), notifies in writing
the competent governmental authority of the exporting Party or
its designees without delay when such exporter or producer
knows that the product does not qualify as an originatingproduct of the Party indicated in the Certificate of Origin.
9. The competent governmental authority of the exporting
Party or its designees shall, if they receive notification inaccordance with paragraph 8 or if they learn, after theissuance of the Certificate of Origin, that the product does
not qualify as an originating product of the Party indicatedin the Certificate of Origin, cancel the Certificate of Origin,and promptly notify the cancellation to the exporter to whom
the Certificate of Origin has been issued and to the customs
authority of the importing Party, except where the Certificateof Origin has been returned to the competent governmental
authority of the exporting Party or its designees without
being used.

Article XVII
Certificate of Origin Issued Retrospectively
1. A Certificate of Origin shall be issued by the time of
shipment, except as provided for in paragraph 2.
2. In exceptional cases where the Certificate of Origin has
not been issued by the time of shipment, the competent
governmental authority of the exporting Party or its designees
shall, at the request of the exporter, issue a Certificate ofOrigin retrospectively in accordance with paragraph 6 of
Article XVI of this Annex. Such Certificate of Origin shallbear the phrase “ISSUED RETROSPECTIVELY” in field 7.

347

Article XVIII
Issuance of a Duplicate Certificate of Origin
In the event of theft, loss or destruction of an issued
Certificate of Origin before the expiration of its validity,
the exporter may request the competent governmental authorityof the exporting Party or its designees to issue a new
Certificate of Origin as a duplicate of the original
Certificate of Origin on the basis of the documents in theirpossession. The Certificate of Origin issued in this way may
bear the word “DUPLICATE” in field 7. The date of issuance ofthe original Certificate of Origin shall be indicated in the
new Certificate of Origin. The new Certificate of Origin shallbe valid during the term of the validity of the original
Certificate of Origin.

Article XIX
Origin Declaration
1. An origin declaration referred to in paragraph (b) of
Article XV of this Annex may be produced, in accordance withthis Article, only by an approved exporter provided for inparagraph 2.
2. The competent governmental authority of a Party may
authorise an exporter in the customs territory of that Party
to produce an origin declaration as an approved exporter, on
condition that:(a) the exporter makes frequent shipments of originatingproducts of a Party;(b) the exporter fulfils the conditions set out in thelaws and regulations of the exporting Party; and(c) the exporter gives the competent governmental
authority of the exporting Party a written
undertaking that he or she accepts full
responsibility for any origin declaration which
identifies him or her as if it had been signed inmanuscript by him or her.

348

3. The competent governmental authority of the exporting
Party shall allocate to the approved exporter an authorisation
number which shall appear on the origin declaration. The
origin declaration does not have to be signed by the approved
exporter.
4. An origin declaration may be produced only if the productconcerned can be considered as an originating product of a
Party.
5. Where the approved exporter is not the producer of the
product in the customs territory of the exporting Party, an
origin declaration for the product may be produced by theapproved exporter in accordance with the laws and regulationsof the exporting Party on the basis of:(a) information provided by the producer of the productto the approved exporter;(b) a declaration, given by the producer of the productto the approved exporter, that the product qualifies
as an originating product of a Party; or(c) a declaration given to the approved exporter byanother person, as provided for in the applicablelaws and regulations of the exporting Party.
6. An approved exporter shall be prepared to submit at any
time, at the request of the competent governmental authorityof the exporting Party, all appropriate documents proving thatthe product for which the origin declaration was produced
qualifies as an originating product of the Party indicated in
the origin declaration.

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7. The text of an origin declaration shall be as provided forin Appendix 3 to this Annex. An origin declaration shall be
produced in accordance with the laws and regulations of theexporting Party by an approved exporter by typing, stamping or
printing on the invoice, the delivery note or any othercommercial document which describes the product concerned in
sufficient detail to enable it to be identified. The origin
declaration shall be considered to be produced on the date of
the issuance of such commercial document.
8. An origin declaration for a product may be produced by theapproved exporter at the time of or after the exportation of
the product.
9. The competent governmental authority of the exporting
Party may verify the proper use of the authorisation as an
approved exporter. The competent governmental authority of theexporting Party may withdraw the authorisation at any time. It
shall do so in accordance with the laws and regulations of theexporting Party where the approved exporter no longer fulfils
the conditions referred to in paragraph 2 or otherwise makes
improper use of the authorisation.
10. Each Party shall ensure that the approved exporter, which
its competent governmental authority has authorised, who has
produced the origin declaration for a product notifies inwriting the competent governmental authority without delay
when such approved exporter learns that the product does not
qualify as an originating product of the Party indicated in
the origin declaration.
11. The competent governmental authority of the exporting
Party shall, when it receives notification in accordance withparagraph 10, promptly notify the fact to the customs
authority of the importing Party.

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Article XX
Validity of Proof of Origin
1. A proof of origin shall be valid for twelve months fromthe date on which it is issued or produced, and shall be
submitted for single importation within such period to thecustoms authority of the importing Party.
2. Proofs of origin which are submitted to the customs
authority of the importing Party after the final date forsubmission specified in paragraph 1 may be accepted when
failure to observe the time-limit is due to force majeure orother valid causes beyond the control of the exporter orimporter.

Article XXIClaim for Preferential Tariff Treatment
1. The importing Party shall grant preferential tariff
treatment in accordance with this Agreement to an originatingproduct of the importing Party or the exporting Party,
imported from the customs territory of the exporting Party, on
the basis of the proof of origin submitted by the importer who
claims preferential tariff treatment in accordance with theprocedures applicable in the customs territory of theimporting Party.
2. Notwithstanding paragraph 1, the importing Party may waive
the requirement for a proof of origin in accordance with its
laws and regulations.
3. Where an originating product of a Party is imported
through one or more non-Parties, the importing Party may
require importers who claim preferential tariff treatment forthat product to submit:(a) a copy of through bill of lading; or351

(b) a certificate or any other information given by thecustoms authority of such non-Parties or otherrelevant entities, which evidences that the producthas not undergone operations other than splitting upof the consignment, and unloading, reloading and anyother operation designed to preserve it in goodcondition in those non-Parties.
4. The customs authority of the importing Party may denypreferential tariff treatment to a product for which animporter claims preferential tariff treatment where suchproduct is not considered as an originating product of theimporting or the exporting Party or where the importer fails
to comply with any of the relevant requirements of this Annex.

Article XXII
Supporting Documents
The documents referred to in paragraph 4 of Article XVI ofthis Annex and paragraph 6 of Article XIX of this Annex used
for the purposes of proving that the product covered by aproof of origin qualifies as an originating product of a Party
may consist of inter alia the following:(a) direct evidence of the processes carried out by theexporter or producer to obtain the products concerned,
contained for example in his or her transaction
documents;(b) documents proving that the materials used in the
production of the product qualify as originatingproducts of a Party, issued or produced in thecustoms territory of a Party where these documents
are used, as provided for in its laws andregulations;(c) documents proving the working or processing ofmaterials in the customs territory of a Party, issued
or produced in the customs territory of a Party wherethese documents are used, as provided for in its laws
and regulations; or352

(d) proof of origin proving that the materials used in
the production of the product qualify as originatingproducts of a Party, issued or produced in thecustoms territory of a Party.

Article XXIII
Preservation of Documents and Records
1. The exporter to whom a Certificate of Origin was issued
shall keep the documents referred to in paragraph 4 of Article
XVI of this Annex for at least three years after the date on
which the Certificate of Origin was issued.
2. The approved exporter who has produced an origin
declaration shall keep a copy of the commercial document on
which the origin declaration was produced as well as the
documents referred to in paragraph 6 of Article XIX of thisAnnex for at least three years after the date on which theorigin declaration has been produced.
3. The producer of a product referred to in subparagraph 5(b)of Article XVI of this Annex and the person referred to in
subparagraph 5(c) of Article XVI of this Annex shall keep therecords relating to the origin of the product for at least
three years after the date on which the Certificate of Origin
was issued or after the date on which the declaration referred
to in subparagraph 5(c) of Article XVI of this Annex was givenby the person to the exporter, as specified in the laws andregulations of the exporting Party.
4. The producer of a product referred to in subparagraph 5(b)of Article XIX of this Annex and the person referred to in
subparagraph 5(c) of Article XIX of this Annex shall keep therecords relating to the origin of the product for at least
three years, or a longer period where it is specified in thelaws and regulations of the exporting Party, after the date on
which the declaration referred to in subparagraphs 5(b) or
5(c) of Article XIX of this Annex was given by the producer or
person to the approved exporter, as specified in the laws andregulations of the exporting Party.

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5. The competent governmental authority of the exporting
Party or its designees which has issued a Certificate ofOrigin shall keep a record of that Certificate of Origin for
at least three years after the date on which the Certificateof Origin was issued.

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Section 5
Arrangements for Administrative Cooperation

Article XXIV
Notifications
1.

Each Party shall provide the other Party with:(a) the form of its Certificate of Origin;(b) the design feature of impressions of stamps used by
the competent governmental authority or its designees
for the issuance of Certificates of Origin; and(c) a sample of impressions provided for in subparagraph(b).

2. Where the competent governmental authority of theexporting Party designates other entities or bodies to carryout the issuance of Certificate of Origin, the exporting Party
shall notify in writing the other Party of its designees.
3. The competent governmental authority of a Party shallprovide the other Party with information on the composition of
the authorisation number for approved exporters, where
established by the Party.

Article XXV
Verification of Proofs of Origin
1. In order to ensure the proper application of this Annex,
the Parties shall assist each other to carry out verificationof the proof of origin and the correctness of the information
given therein, in accordance with this Agreement and theirrespective laws and regulations.
2. Upon request of the customs authority of the importing
Party, the competent governmental authority of the exporting
Party shall carry out the verifications referred to inparagraph 1.
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3. For the purpose of the verification, the customs authorityof the importing Party shall return the proof of origin, or a
copy thereof, to the competent governmental authority of theexporting Party, as the case may be, giving the reasons forthe request for the verification. Any documents andinformation obtained suggesting that the information given in
the proof of origin is incorrect shall be forwarded to thecompetent governmental authority of the exporting Party insupport of such request.
4. For the purpose of the verification, the competent
governmental authority of the exporting Party shall take anynecessary measures to call for any evidence and to carry out
any inspection of the documents or premises of the exporter,or the producer or the person referred to in Articles XVI and
XIX of this Annex, and any other inspection consideredappropriate.
5. The customs authority of the importing Party may suspend
the granting of preferential tariff treatment to the products
covered by the proof of origin concerned while awaiting theresults of the verification. However, it shall not wait for
the verification to be completed before it releases the
product to the importer, in accordance with its laws andregulations, unless the product is subject to appropriate
administrative measures.
6. The competent governmental authority of the exporting
Party shall inform the customs authority of the importing
Party of the results of the verification as soon as possible.
The results shall indicate clearly whether the proof of origin
is authentic and whether the product concerned qualifies as an
originating product of the Party indicated in the proof oforigin.

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7. If there is no reply from the competent governmental
authority of the exporting Party within ten months of the dateof the request for the verification or within any other time
period agreed upon by the Parties, or if the reply does notcontain sufficient information for determining theauthenticity of the proof of origin concerned or thequalification of the product as an originating product of theParty indicated in the proof of origin, the customs authorityof the importing Party shall be entitled to refuse to grant
preferential tariff treatment.
8. Upon written request of the importing Party and subject toany conditions set out by the competent governmental authorityof the exporting Party, customs officials of the importing
Party may be present as observers during the verification
conducted by the competent governmental authority of theexporting Party. If the exporting Party refuses such presenceof customs officials, the importing Party shall be entitled toconsider the product covered by the proof of origin as nonoriginating.

Article XXVI
Confidentiality
1. Each Party shall maintain, in accordance with its laws andregulations, the confidentiality of information provided to it
as confidential pursuant to this Annex, and shall protect that
information from disclosure.
2. Information obtained by the customs authority of theimporting Party pursuant to this Annex:(a) may only be used by such authority for the purposesof this Annex; and(b) shall not be used by the importing Party in any
criminal proceedings carried out by a court or ajudge, unless such information is requested by andprovided to the importing Party through the
diplomatic channels or other channels established inaccordance with the applicable laws and regulationsof the exporting Party.
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Article XXVII
Penalties and Measures against Fraudulent Acts
Each Party shall establish or maintain, in accordance with
its laws and regulations, appropriate penalties, sanctions, orother measures against its exporters, and the producers andpersons referred to in Articles XVI and XIX of this Annex who
have committed fraudulent acts in connection with a proof oforigin.

Article XXVIII
Operational ProceduresUpon entry into force of this Agreement, the Joint
Committee shall adopt Operational Procedures that provide
detailed regulations pursuant to which the customs authorities,
the competent governmental authorities and other relevant
authorities of the Parties shall implement their functions
under this Annex.

Article XXIX
Miscellaneous
1. Communications between the importing Party and theexporting Party shall be conducted in the English language.
2. For the purposes of determining the origin in accordancewith Section 2, the generally accepted accounting principles
in the customs territory of the exporting Party shall beapplied.

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Section 6
Final Provisions

Article XXX
Sub-Committee on Rules of Origin, Customs Procedures
and Trade Facilitation
1. For the purposes of the effective implementation andoperation of Chapter 3 and this Annex, the Sub-Committee on
Rules of Origin, Customs Procedures and Trade Facilitation(hereinafter referred to in this Article as “the SubCommittee”) is hereby established.
2.

The functions of the Sub-Committee shall be:(a) reviewing, monitoring and, as necessary, making
appropriate recommendations to the Joint Committeeon:(i)

the implementation and operation of Chapter 3
and this Annex;(ii)

any amendments to Appendices 1 to 3 to thisAnnex; and(iii) the Operational Procedures referred to in
Article XXVIII of this Annex;(b) considering any other matter related to Chapter 3 andthis Annex as the Parties may agree;(c) reporting its findings to the Joint Committee; and(d) carrying out other tasks assigned by the Joint
Committee.
3. The Sub-Committee shall meet at such time and venue as may
be agreed by the Parties.

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4. The Sub-Committee shall be composed of representatives of
the Parties.

Article XXXITransitional Provisions for Products in Transit or Storage
The provisions of this Agreement may be applied to
products which comply with the provisions of this Annex, andwhich on the date of entry into force of this Agreement, areeither in transit from the customs territory of the exporting
Party to the customs territory of the importing Party or in
temporary storage in a bonded warehouse under customs control.
Such application shall be subject to the submission to thecustoms authority of the importing Party, within four monthsof the date of entry into force of this Agreement, of a
Certificate of Origin issued retrospectively or an origin
declaration and, if required pursuant to Article XXI of thisAnnex, such other documentation relating to the importation of
the product.

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