What is the origin of the goods?? How are regulations related to the origin of goods applied?? Let's find out details with Cuong Quoc Logistics through the article below!

What is the Origin of Goods??

According to the provisions of the Law on Foreign Trade Management 2017 and Clause 1, Article 3 of Decree 31/2018/ND-CP, Origin of goods is defined as follows:

Origin of goods is country, group of countries or territories where all the goods are produced or where the final substantial processing of the goods is carried out, in case of multiple countries, group of countries or territories participating in the production process.

In other words, Origin of goods determines the source of any product or goods. In the context of international specialization, when goods are produced through many countries or stages, Origin is determined at the place where the product is finished, processing, machining or assembly, meet standards under trade agreements between countries, economic area or territory.

The Difference Between Origin of Goods and Place of Manufacture of Goods

Although they are familiar concepts, The origin of the goods and the place of production are completely different. In the field of logistics, It is important to understand this difference.

Criterion	Origin of goods	Place of production
Concept	Nation, group of countries or territories where all goods are produced or where final processing is performed.	The area where the product is produced or processed, often considered by consumers as the origin of the product.
Nature	Certificate of origin to enjoy tariff or non-tariff incentives.	Provide information about production locations to meet consumer needs.
Legal value	Granted Certificate of Origin (C/O), Mandatory written on product labels (according to Clause 1, Article 10 of Decree 43/2017/ND-CP).	No legal value, only commercial to attract consumers.

Why Do You Need Rules of Origin of Goods??

Rules of Origin of Goods

According to Article 3 of Decree 31/2018/ND-CP, Rules of origin of goods are divided into two types: preferential rules of origin and non-preferential rules of origin.

• Preferential rules of origin: Applies to goods that enjoy preferential tariff and non-tariff commitments or agreements.

• Non-preferential rules of origin: Applies to goods not subject to incentives, often related to trade measures such as anti-dumping, anti-subsidy, self defense, tariff quotas, Government procurement or trade statistics.

1. Preferential Rules of Origin

a. Rules of origin according to international treaties

Determining the origin of goods to enjoy tariff and non-tariff incentives is carried out according to international treaties to which Vietnam is a party., along with instructions from the Ministry of Industry and Trade. Free trade agreements (FTA) such as the comprehensive and progressive partnership of the Pacific (CPTPP) or the Vietnam - EU Free Trade Agreement (EVFTA) brings many benefits to member countries, especially in reducing import taxes.

Vietnam currently participates in 16 bilateral and multilateral FTAs, create favorable conditions for the logistics industry with benefits such as:

• Improve the business and institutional environment.

• Promote economic growth, improve people's lives.

• Expand export markets to large countries such as Japan, Australia, Canada, New Zealand.

b. Rules of origin under the universal preferential tariff regime (GSP)

Goods exported from Vietnam can enjoy universal tariff preferences (GSP) according to the rules of origin of the importing country, guided by the Ministry of Industry and Trade. Countries like the EU, Japan, Türkiye issues C/O form A or other unilateral documents of origin so that Vietnamese goods can enjoy GSP tax incentives..

c. Types of preferential certificates of origin

• C/O form A: For goods exported to countries applying universal preferential tariff regimes (GSP).

• C/O form D: Applicable in ASEAN to enjoy incentives under the ATIGA Agreement.

• C/O form E: ASEAN-China Agreement (ACFTA).

• C/O form AK: ASEAN – Korea Agreement (AKFTA).

• C/O form AJ: ASEAN – Japan Agreement (AJFTA).

• C/O form AANZ: ASEAN – Australia – New Zealand Agreement (AANZFTA).

• C/O form AI: ASEAN – India Agreement (AIFTA).

• C/O form EAV: Vietnam – Eurasian Economic Union Agreement.

• C/O form VC: Vietnam - Chile Agreement.

• C/O form KV/VK: Vietnam - Korea Agreement.

• C/O form JV/VJ: Vietnam – Japan Agreement.

• C/O form S – Laos: Vietnam - Laos economic cooperation agreement.

• C/O mẫu S/X – Cambodia: Vietnam - Cambodia economic cooperation agreement.

d. Origin criteria for preferential goods

Goods are considered originating under the FTA if they meet one of the criteria:

• Pure origin (WO): Goods are produced entirely in one or more member countries.

• Not pure (Non-WO): Goods meet item-specific rules or general criteria.

• Manufactured from internal raw materials (PE): Goods are produced from raw materials originating from FTA member countries.

e. Bilateral and multilateral agreements

• Unilateral agreement (GSP).

• Bilateral agreement (VJEPA, VCFTA, CPTPP…).

• Multilateral agreement (AT LEAST, ASEAN+, FTAs).

2. Non-Preferential Rules of Origin

Non-preferential rules of origin apply to goods that are not subject to preferential tariffs, are specified in detail in Appendix I, Circular 05/2018/TT-BCT. Goods that meet this criteria will be issued C/O form B, Vietnam's non-preferential certificate of origin.

Why Do You Need Rules of Origin of Goods??

Rules of origin play an important role in international trade, with main purposes:

• Enjoy preferential tax rates: Ensure goods from FTA member countries enjoy tariff benefits.

• Apply commercial measures: Prevent dumping, illegal subsidies, or apply self-defense measures.

• Trade statistics: Support state agencies to monitor import and export activities.

• Comply with labeling regulations: Ensure goods are labeled in accordance with legal regulations.

• Control of goods: Prevent goods from non-FTA countries from enjoying invalid tax incentives.

• Government procurement support: Meet legal requirements in public bidding.

Goods Origin “Made in Vietnam”

According to Decree 31/2018/ND-CP, Goods with "Made in Vietnam" origin are determined to issue C/O or self-certification documents of origin, to enjoy tariff or non-tariff incentives when exporting to markets that have agreements with Vietnam. “Made in Vietnam” goods can be understood as:

• Goods originating in Vietnam to enjoy preferential tariffs.

• Goods are manufactured in Vietnam.

• Vietnamese branded goods.

Production stage in Vietnam

According to Article 9 of Decree 31/2018/ND-CP, machining stages, Simple processing is not considered when determining origin, include:

• Preserving goods (drying, refrigerant, soak in salt, sulfur steam…).

• Screening, classify, clean, paint, split.

• Change packaging, simple packaging.

• Label, label on the product.

• Simple mixing of products.

• Simple assembly of parts.

Vietnamese branded goods

Vietnamese branded goods may be related to geographical indications under the Intellectual Property Law, with criteria:

• Products are sourced from the region, respective locality or territory.

• The product has a good reputation, quality or characteristic determined by the geographical conditions of that area.

Conclude

The above article has provided detailed information about the origin of goods and related regulations. For more advice on logistics, Please contact Cuong Quoc Logistics via website or hotline: 0972 66 71 66.

CUONG QUOC LOGISTICS COMPANY LIMITED
Office: 7th floor, Parami Building, 140 Bach Dang, Tan Son Hoa Ward, Ho Chi Minh City
Hotline: 0972 66 71 66
Email: info@cql.com.vn
Website: https://cql.com.vn