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HMRC internal manual

Import preference guidance notes

Guide Notes: incorrect tariff heading in Box 8 of GSP Form A

Important: see also IPGN5050 and IPGN5150.

When a tariff heading is entered in Box 8 it acts as a declaration that the origin rules for the goods of that heading have been met. If the goods are found to be classified in a different heading, a different origin rule may apply. It is not always necessary however to reject the certificate, as some origin rules are compatible.

To determine whether the certificate should be rejected look up the origin rule for both headings and then follow the procedure below.

Note: explanations of the types of rules referred to below can be found in IPGN2050.

Reject, where:

  • the origin rule for both headings or the correct heading (in whole or in part) requires a change of tariff heading for all materials or places a limit on the percentage of non-originating components which may be used within the same heading as the finished product.

Example: Form A heading is 95.03: correct heading is 49.10. The Form A is certifying only that no non-originating materials of 95.03 were used. The possibility exists that non-originating materials of 49.10 were used

  • the value of non-originating materials which may be used is higher for the heading shown on the Form A.

Example: Form A heading 84.80 allows up to 50% but the correct heading 84.15 allows only 40%. If the actual percentage used in manufacture was 45% this would be within the 50% limit but above the 40% allowed under the correct rule, and

  • the rule for the correct heading requires additional manufacturing processes.

Example: Form A heading is 62.03 (manufacturing from yarn), correct heading for the garment (which is obtained other than by sewing together 2 or more pieces of fabric) is 61.03 (manufacture from natural fibres).

Accept, where:

  • the origin rule for both headings is the same.

Example: Form A heading is 39.26; correct heading is 39.24. Both headings allow the use of non-originating materials up to a value of 50% of the ex-works price. Note: where each heading has a change of tariff heading or a percentage rule restricting usage of materials of the same heading as the finished product, eg a 25% rule, the certificate should be rejected, see above

  • the percentage of non-originating materials allowed is lower for the Form A heading rule.

Example: Form A heading is 84.15; correct heading is 84.80. The rule for 84.15 allows up to 40% but the rule for 84.80 allows up to 50%. Note: if the correct heading requires in addition a change of tariff heading for all or a percentage of parts the certificates should be rejected

  • the rule for the heading shown on the Form A requires a change of tariff heading and limits to a given percentage the value of non-originating materials or parts which may be used, provided the rule for the correct heading allows the same or a higher percentage.

Example: Form A heading 96.12 limits the use of non-originating materials to 50% of the ex-works value and, in addition, requires a change of tariff heading for non-originating materials, the correct heading 39.26 has only to satisfy the 50% limit, and

  • the rule for the heading shown on the Form A indicates that the goods have undergone a further stage of production than required by the rule for the correct heading.

Example: Form A heading for the garment (which is obtained other than by sewing together 2 or more pieces of fabric) is 61.03 (manufacture from natural fibres), correct heading is 62.03 (manufacture from yarn).

In cases which are not covered by the above guidance, or instances where the 2 headings refer to totally different goods (ie heading on GSP 84.18 refrigerators and entered heading on GSP 84.12 other engines) officers should contact the Tariff Preference UoE for advice.

Note: acceptance of the Form A on the basis of the check covered by this section does not necessarily imply that the rule in question has been met. If there are other reasons to doubt that the goods are entitled to preference the Tariff Preference UoE may wish to carry out a full verification.

Note: if a certificate is rejected after following the above procedure the importer may obtain a ‘retrospectively issued’ certificate bearing the correct heading. To do so, the importer will need to return the incorrect certificate to his supplier in the preference country. A returned certificate should be marked ‘Document not accepted’, or similar, together with the reason.

The following table gives the appropriate decision for the most common combinations of origin rules.

Key to origin criteria:

Change of Tariff Heading

Manufacture from imported materials or parts which fall under a different four figure tariff heading from that of the finished product.

40% / 50%

Manufacture in which the value of all non-originating materials used does not exceed 40%/50% of the ex-works price.

5% change of tariff heading

Where, within the above limit, the value of all non-originating materials or parts classified within the same heading as the product does not exceed 5% of the ex-works price of the product.

Originating / non-originating

The value of all the non-originating materials used does not exceed the value of the originating materials used.

Pre-yarn

Manufacture from:

  • natural fibres
  • man-made staple fibres not carded or otherwise processed for spinning
  • chemical materials or textile pulp.

Yarn

Manufacture in which the materials used are at a no later stage of production than yarn.

 

GSP Form A Correct heading Decision
     
Change of tariff heading Change of tariff heading Reject
Change of tariff heading Any rule Reject
Any rule Change of tariff heading Reject
40% and change of tariff heading or alternatively 30% 40% and change of tariff heading or alternatively 30% Reject
Any rule 40% and change of tariff heading or alternatively 30% Reject
40% and originating/non-originating or alternatively 30% 40% and originating/non-originating or alternatively 30% Accept
50% rule only 40% rule only Reject
Yarn Pre-yarn Reject
40% rule only 40% rule only Accept
40% rule only 50% rule only Accept
40% rule and change of tariff heading 40% rule only Accept
Pre-yarn Yarn Accept

 

 

Note: if the rule is preceded by ‘ex’ see Notice 828 Tariff Preferences: Rules of Origin for (various).