EU-Chile Association Agreement

At a glance

The EU and Chile concluded an Association Agreement in 2002, which includes a comprehensive Free Trade Agreement that entered into force in February 2003 covering EU-Chile trade relations.

The agreement was amended by the 2004 Accession Protocol.

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Rules of Origin

In order to qualify for preferential treatment, your product will need to satisfy the rules of origin under the agreement. Please check the interactive “Rules of Origin Self Assessment tool (ROSA)” in My Trade Assistant to assess whether your product fulfils the rules of origin and find out how to prepare the correct documents.

General information about the rules of origin and the origin procedures can be found in this section.

Origin is the 'economic nationality' of traded goods. If you are new to the topic, you can find an introduction to the main concepts in the goods section.

Rules of origin

Where can I find the rules of origin?

The rules of origin are set out in Annex III to the Association Agreement (OJ L 352, 30.12.2002, p. 935). The link refers to the consolidated version as amended by the 2004 Accession Protocol to the Agreement (OJ L 38, 10.2.2005, p. 3) and Decision No 2/2015 of the EU-Chile Association Committee of 30 November 2015.

Explanatory Notes to Annex III have been published in 2003 (OJ C 321, 31.12.2003, p. 22) and revised in 2005 (OJ C 56, 5.3.2005, p. 36).

Does my product originate in the EU or Chile?

For your product to qualify for the lower or zero preferential tariff under the EU-Chile Association Agreement, it must originate in the EU or Chile.

A product originates in the EU or in Chile, if it is

• wholly obtained in the EU or Chile, or
• manufactured in the EU or Chile using non-originating materials provided such materials have been sufficiently worked or processed in compliance with the product specific rules set out in Appendix II
  See also Appendix I "Introductory notes” to product specific rules of origin.        
  For certain products, there are some alternative product specific rules - see Appendix IIa.

Examples of product specific rules in EU trade agreements

• the value-added rule – the value of all of the non-originating materials in a product cannot exceed a certain percentage of its ex-works price
• the change of tariff classification – the production process results in a change of tariff classification between the non-originating materials and the final product – for example production of paper (Harmonized System Chapter 48) from non-originating pulp (Harmonized System Chapter 47)
• specific operations – a specific production process is required, for example spinning of fibers into Such rules are primarily used in the textiles and clothing, and chemical sectors

Tips to help you comply with the product specific rules

The agreement provides additional flexibility to help you comply with product specific rules, such as tolerance or cumulation.

Tolerance

• the tolerance rule allows the producer to use non-originating materials that are normally prohibited by the product specific rule up to 10% of the product’s ex-works price
• tolerance cannot be used to exceed any maximum-value threshold of non-originating materials  listed in the product specific rules
• specific tolerances apply to textiles and clothing classified in Harmonized System Chapters 50 to 63, which are included in Notes 5 to 7 of Appendix I "Introductory notes” of product specific rules of origin

Cumulation

• Bilateral cumulation - materials originating in Chile can be counted as originating in the EU (and vice versa) when used in the manufacturing of a product

Other requirements

The product also needs to fulfil all other applicable requirements specified in the Protocol such as insufficient working or processing or the direct transport rule.

Transport through a third country: direct transport rule

Originating products must be transported from the EU to Chile (and vice-versa) without being further processed in a third country.

Transhipment or temporary warehousing in a third country is allowed, provided that goods remain under the surveillance of the customs authorities and do not undergo operations other than

• adding or affixing marks, labels, or seals
• unloading
• reloading
• splitting of consignments
• any operation designed to preserve them in good condition

You will have to provide evidence of the direct transport to the customs authorities of the importing country, such as:

• contractual transport documents (for example bills of lading)
• factual or concrete evidence based on marking or numbering of packages
• any evidence related to the goods themselves

Duty drawback

Under the EU-Chile Association Agreement it is not possible to get refund on duties previously paid on non-originating materials used to produce a product that is exported under a preferential tariff.

Origin procedures

 If you want to claim a preferential tariff, you will have to follow the origin procedures and have your claim verified by the customs authorities of the country into which you are importing your goods. The procedures are set out in Title V on Proof of Origin and Title IV on Arrangements for Administrative Cooperation.

How to claim a preferential tariff

To benefit from a preferential tariff, importers must provide proof of origin.

The proof of origin can be either

• a movement certificate EUR.1, or
• an origin declaration by the exporter

Consult the Explanatory Notes to Annex III and their revised version for details on completion of proofs of origin.

No proof of origin is required when the total value of the consignment does not exceed

• €500 for small packages or
• €1,200 for personal luggage

Proof of origin remains valid for 10 months from the date of issue.

Movement certificate EUR.1

Movement certificates EUR.1 are issued in Chile by the Dirección General de Relaciones Económicas Internacionales (DIRECON) of the Ministry of Foreign Affairs, as well as its local ProChile offices. DIRECON is also responsible for

• granting, monitoring and withdrawing authorisations to 'approved exporters'
• post-verification checks following a request by customs authority in an EU Member States

The customs authority in Chile can request customs authorities in the EU Member States to verify the originating status of the goods or the authenticity of the proof of origin. The exporter applying for the certificate should be prepared to submit documents proving the originating status of the products concerned.

Appendix III includes a specimen of a EUR.1 certificate and gives indications for its completion.

Origin declaration

Exporters can self-declare that their product originates in the EU or Chile by providing an origin declaration. It can be made by

• an approved exporter, or
• by any exporter provided that the total value of the consignment does not exceed € 6 000

To become an approved exporter, you must be able to satisfy the competent customs authorities of the originating status of your products, as well as any other requirements they may impose. The competent authorities can withdraw your approved status if you abuse it in any way. To find out more about the procedures, contact the competent customs authorities (DIRECON for the Chilean side).

How to make an origin declaration?

The exporter should type, stamp or print the following declaration (in the appropriate language) on the invoice, delivery note or other commercial document which describes the products concerned in sufficient detail for them to be identified:

"The exporter of the products covered by this document (customs authorisation No ...) declares that, except where otherwise clearly indicated, these products are of ... preferential origin."

The text of the origin declaration can be made in any of the official languages of the EU and can be found in Appendix IV. Check with your customs authorities for any extra requirements they might have.

You must sign your origin declaration by hand. If you are an approved exporter, you are exempted from this requirement provided you give your customs authorities a written undertaking that you accept full responsibility for any declaration identifying you.

When filling in an origin declaration, you should be prepared to submit documents proving the originating status of your products.

An origin declaration may be made by the exporter when the products to which it relates are exported, or after exportation on condition that it is presented to the customs authorities of the importing country no longer than two years after the importation of the products to which it relates.

Verification of origin

The customs authorities may verify whether a product imported is indeed originating or fulfils other origin requirements. Verification is based on

• administrative cooperation between customs authorities of the importing and the exporting parties
• checks done by local customs — visits of the importing party to the exporter are not allowed

The authorities of the exporting party determine the origin and inform the authorities of the importing party of the results.

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