Inquiry: Reduced Tariffs for Chinese Imports with Certificate of Origin, and Specific Conditions, Procedures, Applicable Items, and Certificate of Origin Issuance/Submission Details for APTA Preferential Tariffs Released

The information that you can submit a Certificate of Origin for goods imported from China to receive lower tariffs is very accurate. This benefit is primarily made possible through a multilateral trade agreement called the Asia-Pacific Trade Agreement (APTA). APTA is an agreement involving seven countries, including South Korea, China, India, Bangladesh, Laos, Sri Lanka, and Mongolia, which aims to apply preferential tariffs, lower than general tariff rates, to specific items among the participating countries. This serves as an important means to reduce import costs and secure price competitiveness.

A key condition for applying APTA preferential tariffs is that the goods must be originating goods of a contracting party. A mere 'Made in China' label is insufficient; the goods must meet the strict Rules of Origin (criteria for determining origin) set forth in the agreement. For example, it must be proven that the goods were wholly obtained or produced in that country, or underwent sufficient processing to result in a substantial transformation. Since the exporter is most familiar with whether these origin criteria are met, it is crucial to discuss and confirm this with the exporter prior to import.

Which items are subject to APTA preferential tariffs is very specifically defined. The applicable items and their preferential tariff rates can be found in Annex 3 of the 「Regulations on Concessional Tariffs under the WTO Agreement, etc.」. These regulations are available for viewing on platforms such as the Customs Act Information Portal (UNI-PASS), and you must search by the HS code (Harmonized System code/product classification number) of the goods you intend to import to determine the exact tariff rate. Even for the same item, there can often be a significant difference between general tariffs and preferential tariffs, so it is essential to confirm in advance to prevent disadvantages.

The essential document for applying APTA preferential tariffs is the Certificate of Origin (COO). For goods originating from China, only Certificates of Origin issued by designated issuing authorities within China are validly recognized. The main issuing bodies for Certificates of Origin in China are the 'China Entry-Exit Inspection and Quarantine Bureau' (CIQ, now an organization under the General Administration of Customs) or the 'China Council for the Promotion of International Trade' (CCPIT). The exporter must provide the importer with a Certificate of Origin officially issued by one of these two bodies. As a rule, the Certificate of Origin should be issued before or at the time of shipment, and this point should be clearly requested from the exporter.

The timing of submitting the Certificate of Origin is very important. In principle, it must be submitted to customs at the time of import declaration. However, there are deferment provisions for cases where it cannot be submitted at the time of import declaration due to unavoidable reasons. If a Certificate of Origin was issued before the import declaration but could not be submitted at the time of import declaration due to reasons such as loss, incompleteness, or not being aware of preferential tariff application, it can still be submitted even after the import declaration has been accepted. In this case, preferential tariffs can be applied if the Certificate of Origin is submitted to customs within one year retroactively from its issuance date. Naturally, the issuance date must be prior to the import declaration date. Through such post-submission, a refund of customs duties can be claimed, which is carried out through a post-correction (C/O post-submission) procedure.

To accurately apply tariff benefits, the validity and authenticity of the Certificate of Origin must be thoroughly verified. Cross-check whether the issuing body, issuance number, exporter/importer information, item name, HS code, and quantity are accurately stated, and also confirm that the signatory's signature and the institution's seal are correctly affixed. Customs may request verification of the authenticity of the submitted Certificate of Origin and the actual origin of the goods, and if issues arise during this process, the application of preferential tariffs may be excluded. Therefore, it is extremely important to carefully store and manage all relevant documents. By proceeding with the help of a professional customs broker, you can receive preferential tariff benefits more quickly and accurately.