Special Rules of Origin to Help LDC Exports at Zero Duty

WTO members held their first discussions on 22 April regarding implementation of the Ministerial Decision on Preferential Rules of Origin for Least Developed Countries (LDCs). The Ministerial Decision was one of the key outcomes of the WTO’s 10th Ministerial Conference in Nairobi last December.

The provisions set out under the Nairobi Decision aim to facilitate least-developed countries’ export of goods to both developed and developing countries under unilateral preferential trade arrangements in favour of LDCs. Key beneficiaries will be countries of the LDC Group, the proponent for the Nairobi Decision.

The Nairobi Decision builds on the earlier 2013 Bali Ministerial Decision on preferential rules of origin by providing more detailed directions on specific issues, such as methods for determining when a product qualifies as “made in an LDC”, and when inputs from other sources can be “cumulated” - or combined together - into the consideration of origin. The provisions also call on preference-granting members to consider simplifying documentary and procedural requirements related to origin as well as other measures to further streamline customs procedures.

Background

Rules of origin are the criteria used to determine where a product was made. Products that are deemed under such rules to be made in LDCs would qualify for preferential market access schemes for LDCs.

The 2013 Bali Decision set out, for the first time, a set of multilaterally agreed guidelines to help make it easier for LDC exports to qualify for preferential market access. The Bali Decision recognizes that each country granting trade preferences to LDCs has its own method of determining rules of origin, and it invites members to draw upon the elements contained in the Decision when they develop or build on their individual rules of origin arrangements applicable for LDCs.