Rules of Origin

What are rules of origin?

A set of legal standards used to determine how to treat goods being traded from a tariff standpoint on the basis of their country of origin. That is to say—different countries, organizations, and trade agreements stipulate different rules for determining which country you can claim as the country of origin for a specific good.

For example: a trade agreement like NAFTA has specific rules of origin that dictate what criteria or inputs a good not wholly produced in a NAFTA country must meet to be able to claim NAFTA as its country of origin.

How do rules of origin work?

Each agreement sets its own tests. A good may qualify if it's wholly obtained in one country, if its manufacturing changes its tariff classification, or if enough of its value comes from the region. Many agreements apply different tests to different products. (The United States-Mexico-Canada Agreement, or USMCA, has replaced NAFTA.)

Importers use origin to claim preferential duty rates, and customs may ask for proof, such as a certification or supplier declaration. Origin also differs from the country a shipment leaves from. Goods shipped from Singapore can still originate in China. Check the specific agreement and confirm with a licensed customs broker before you claim a preference.

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