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The draftsmen of the General Agreement stated that the rules of origin should be left: ...within the province of each importing country to determine, in accordance with the provisions of its law, for the purpose of applying the most-favoured-nation provisions (and for other GATT purposes), whether goods do in fact originate in a particular country.Article VIII:1(c) of the General Agreement, dealing with fees and formalities connected with importation and exportation, states that the contracting parties also recognize the need for minimizing the incidence and complexity of import and export formalities and for decreasing and simplifying import and export documentation requirements and the Interpretative Note 2 to this Article states that it would be consistent if, on the importation of products from the territory of a contracting party into the territory of another contracting party, the production of certificates of origin should only be required to the extent that is strictly indispensable.
In July 1998 the General Council approved a decision whereby Members have committed themselves to make their best endeavours to complete the Programme by a new target date, November 1999.
The work is being conducted both in the WTO Committee on Rules of Origin (CRO) in Geneva and in the WCO Technical Committee (TCRO) in Brussels.
back to top The results of the harmonization programme are to be approved by the Ministerial Conference and will then become an annex to the Agreement.
When doing this, the Ministerial Conference is also to give consideration to arrangements for the settlement of disputes relating to customs classification and to establish a time-frame for the entry into force of the new annex. until the entry into force of the new harmonized rules) Members are required to ensure that: (a) rules of origin, including the specifications related to the substantial transformation test, are clearly defined; (b) rules of origin are not used as a trade policy instrument; (c) rules of origin do not themselves create restrictive, distorting or disruptive effects on international trade and do not require the fulfilment of conditions not related to manufacturing or processing of the product in question; (d) rules of origin applied to trade are not more stringent than those applied to determine whether a good is domestic, and do not discriminate between Members (the GATT MFN principle).
The CRO considers the input of the TCRO with the aim of endorsing the TCRO's interpretations and opinions, and, if necessary, refining or elaborating on the work of the TCRO and/or developing new approaches.
Upon completion of all the work in the TCRO, the CRO is to consider the results in terms of their overall coherence (Article 9:3).The Agreement sets out a work programme for the harmonization of rules of origin to be undertaken after the entry into force of the World Trade Organization (WTO), in conjunction with the World Customs Organization (WCO).General principles Until the completion of the three-year harmonization work programme, Members are expected to ensure that their rules or origin are transparent; that they are administered in a consistent, uniform, impartial and reasonable manner; and that they are based on a positive standard.back to top The increased number and importance of rules of origin led the Uruguay Round negotiators to tackle the issue during the negotiations.back to top Harmonization The Agreement on Rules of Origin aims at harmonization of non-preferential rules of origin, and to ensure that such rules do not themselves create unnecessary obstacles to trade.It is, however, provided that the determinations made for purposes of defining domestic industry or like products of domestic industry shall not be affected by the Agreement.