Infoquest, (July 16, 2019) -- Mr. Adul Chotinisakorn, director general of the Department of Foreign Trade (DFT) of the Ministry of Commerce, revealed the negotiation progress on rules of origin and certificate of origin under the framework of Regional Comprehensive Economic Partnership (RCEP), claiming that member states have come to terms on the issue of "Proof of Origin" on July 3, 2019, on which they had previously disagreed.
The draft on rules of origin and certificate of origin will promote the trade liberalization under the RCEP to be more efficient, transparent and fair. Taking the chapter for confidentiality as an example, it ensures that trade information secured from private sectors shall only be leveraged for impersonal purposes and shall be disclosed subject to restrictions, and allows the subject to choose direct or indirect calculating methods. Thus, certain calculating method shall not be imposed on the exporting countries, instead, they are entitled to choose a way that is more suitable with domestic trade mode and demands of domestic enterprises.
"The negotiation on rules of origin and certificate of origin is in the last phase. Although there are still many issues that need to be discussed before the final result is drawn, the agreement reached at this meeting on the form of certificate of origin is the key to helping resolve various issues and facilitating the final agreement on pertinent issues through negotiations. The DFT has the confidence that it can push the negotiation to move towards a result that is more beneficial for Thailand's enterprises. And it will reach an agreement within the goals announced by the leaders at the ASEAN Summit in late June 2019," said Mr. Adul.
16 countries signed the RCEP, including ASEAN countries, Australia, China, India, Japan, South Korea and New Zealand. At present, the contents of rules of origin that negotiation parties have come to terms include Self Certification by Approved Exporter and Self Certification by Exporter or Producer that shall be submitted to the customs of the importing country as certificate of origin, so as to obtain preferential tariff treatment in accordance with the RCEP.
"Member states will allow enterprises to choose one of the above forms of certificate of origin to facilitate the business sector. Instead of being forced to choose certain certification, enterprises can have their own choice, which will make the trade among member states under the RCEP more flexible and promote trade growth among them. Trade between Thailand and RCEP members will see an increase too," Mr. Adul said.
He also noted that apart from certificate of origin, three other chapters were also agreed upon during the meeting: (1) Regional Value Content (RVC) allowing the employment of direct method or indirect method for calculating. (2) Confidentiality stipulating the obligations for member states in respect of confidentiality, that is, when a member state receives any confidential information from another, it must keep such information confidential in accordance with its domestic laws and regulations. (3) Guidelines managing indistinguishable and interchangeable identical products or raw materials. Specifically, if the manufacturer mixes interchangeable materials in production or inventory process, and the interchangeable materials include both original items and non-original ones, this dilemma shall be solved according to inventory statistical methods in generally accepted accounting principles when determining the origin of the final products.
Source: InfoQuest, by Phana/Tanawat/Rachada, translated by Xinhua Silk Road
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