Seven tasks on Thailand’s Rules of Origin
The intent and purpose of a Certificate of Origin in Thailand
The Rules of Origin (ROO) define the “nationality of goods.” This is relevant for the applicability and use of Foreign Trade Agreements (FTA). For the scope and contents of ROO, there is no standard in general. Each FTA defines its own criteria, depending on the objective target and overarching goal of the trade agreement. Other areas of application are the most-favored-nation (MFN) treatment and anti-dumping duties.
The ROO system is highly complex and subject to constant changes in the rules and policies. Thailand merely implements the rules as applicable (GSP, GSTP, ASEAN PTA, and CEPT). It uses a value-added criterion. A Global System of Trade Preferences (GSTP) is employed in certain cases. The Common Effective Preferential Tariff (CEPT) is employed among ASEAN member countries.
Under Thailand’s ROO regime, cost of production comprises of (i) local materials (ii) imported materials, (iii) production cost including labor, maintenance, quality control, depreciation, research & development, and (iv) the profit.
A Certificate of Origin is a document used to verify the country of origin of the item being exported, while a Form A Certificate of Origin is used to support certain products to claim for preferential tariff entry into a number of developed countries under the Generalised Systems of Preferences (GSP).
— Bangkok Lawyer (@bangkoklawyer) August 13, 2019
Professional offer to assist on the whole seven-step work-flow in the COO application process
PUGNATORIUS Ltd. advises and assists foreign clients in the application for a Certificate of Original. This includes the following steps:
#1. COO strategy: The successful application for a COO requires a comprehensive understanding of a complex international legal framework. The law firm assists in finding the optimal strategy to benefit from Foreign Trade Agreements and other cross-border arrangements.
#2. Checking basic information: As a first step, the law firm checks the relevant HS code (Harmonised System Nomenclature) of the goods to be exported or manufactured. Also, the lists of eligible products for preferential tariff treatment and its Rules of Origin have to be checked. If required, the customs authority of the importing country or the Customs Department of Thailand or the Department of Foreign Trade (DFT) will be involved in this.
#3. Preexportation verification process: In the case of agricultural products, an application form for pre-exportation verification of origin for agricultural products. has to be submitted for producers/exporters. For industrial products, manufacturers/exporters are required to submit an application form, declaration of costs, production process of the goods, and other supporting documents. The law firm involves the Bureau of Foreign Trade Services, Department of Foreign Trade (DFT) in these procedures.
#4. Exporter/importer DFT registration: In order to submit an application for a Certificate of Origin, the law firm will register the exporter with the DFT. The law firm applies for an Exporter-Importer Card or an Authorised Representative Card. The application form has to be submitted to the Bureau of Foreign Trade Services or its branches or DFT’s Offices of Foreign Trade Region, together with certain supporting documents.
#5. Request for a COO: The law firm submits the application for a COO either through the EDI system, the DFT’s electronic system or via the digital signature system.
#6. Post-verification process: The law firm represents the client in case DFT carries out a retroactive check of the authenticity of the certificate of origin or/and the accuracy of the information regarding the true origin of the goods in question. The goal is to avoid that the importer is blacklisted or set on a watch list for future import/export activities.
#7. Risk management and legal opinion: The law firm provides legal opinions on the legality and risks of COO applications.
The law firm’s professional activities in this business field are summarized at “Legal services, tax structuring, and transaction support services for import, export, and trade businesses“.