China Issues Guidance on Rules of Origin, ASEAN Free Trade Agreement

China issued guidance for its free trade agreement with the Association of Southeast Asian Nations and the rules of origin for imports and exports, according to a Sept. 11 KPMG alert.

The guidance provides updates on new de minimis provisions and updated regulations related to “packing materials and containers, accessories, spare parts and tools, and fungible materials,” KPMG said. China also issued guidelines for filling out Form E, which is a required document that must be used by all parties under the ASEAN-China agreement. The form features improvements, a “simplified process for filling-in information” and now allows Chinese manufacturers, not just exporters, to apply for the Form E. Other changes “relaxed the documentation review requirements under the direct consignment rules” and increased “requirements with respect to enterprises’ compliance management practices.”

KPMG said the updates “improved the preferential rules of origin” under the agreement and show that Chinese customs authorities are “increasingly focusing on origin compliance.” Companies should give “special attention” to avoiding country-of-origin risks, and both importers and exporters “need to understand and apply the correct origin rules.”