What is a Rule of Origin?
A rule of origin is a standard for determining where a product is from, that may be used for a number of different regulatory purposes.
For example, the “substantial transformation” rule is used by U.S. Customs and Border Protection (CBP) to determine a product’s country of origin for marking and government procurement purposes. The “tariff shift” approach is used to determine eligibility for a tariff preference under the North American Free Trade Agreement (NAFTA), Central American Free Trade Agreement (CAFTA), U.S.-Chile Free Trade Agreement and many other bilateral and multilateral trade arrangements. “Buy American” is used to identify products given a competitive bidding advantage for certain U.S. government procurements, while “Buy America” applies to certain mass transit projects funded by the Federal Transit Administration (FTA).
Proper application of a rule of origin is an essential skill in international trade. Overlooking the applicable standard, or misapplying it, can result in such dire consequences as merchandise being denied entry into the U.S., subjected to duties rather than receiving preferential treatment under a trade agreement or excluded from consideration for sales to the U.S. government.
Legal Assistance with Rules of Origin
In my view, rules of origin constitute the ultimate bureaucratic challenges, which I have enjoyed success in solving. I have assisted clients with nearly every such standard imposed by U.S. government agencies. My experience includes representation in CBP country of origin marking and trade agreements (including NAFTA, CAFTA and other bilateral agreements) matters, Federal Trade Commission “Made in U.S.A.” claims, Buy American and substantial transformation rules for Federal government procurement, Buy America provisions for FTA funding and Defense Security Cooperation Agency (DSCA) requirements for funding under the Foreign Military Financing (FMF) program. My chapter on “Rules of Origin for Sales of Products to the United States Government”, part of the Transnational Contracts treatise I write, is the only systematic treatment of the named topic to the best of my knowledge.
Contact me for assistance with Rules of Origin using the form below, or call my office at 202-772-2039.