Where exactly is the country of origin in entrepot trade? Come and help me solve this puzzle!
Solved#Entrepot trade#
I've recently come into contact with entrepot trade - related businesses and am a bit confused about the definition of the country of origin. The goods are produced in country A, transshipped and sold through country B to country C. So, in the entrepot trade, is the country of origin of this good country A or country B? Is there any judgment standard? Is it related to whether the goods have undergone substantial processing in country B? I hope friends who know the ropes can help answer this. Thank you!
Professional consultant answers
Elizabeth LiYears of service：3Customer Rating：5.0
Compliance and risk managerConsult
In entrepot trade, the country of origin of goods is usually determined by the place of substantial change of the goods. If the goods are only transshipped in country B without substantial processing, just simple operations like loading and unloading, warehousing, and sorting, then the country of origin remains country A. Substantial processing generally means that after product processing, there is a change in the tariff classification in the Harmonized Commodity Description and Coding System, or the added - value part of processing accounts for more than a certain proportion of the total value of the new product (the proportion varies in different countries). For example, if the fabric produced in country A is cut and made into clothes in country B, the tariff classification changes, and at this time, the country of origin may be determined as country B. In short, judging the country of origin should be based on whether the goods have undergone a substantial change and the specific rules of origin of each country.
In actual business, it's necessary to understand in detail the relevant regulations of the two trading countries to avoid trade disputes caused by unclear determination of the country of origin.
Robert ChenYears of service：6Customer Rating：5.0
Customer service consultantConsult
Generally, if there is no processing, it's the country of origin A. If there is simple packaging or something like that in country B, it doesn't affect the determination that country A is the country of origin. Only processing that changes the basic characteristics of the goods may change the country of origin.
Andrew HuangYears of service：7Customer Rating：5.0
Supply chain optimization expertConsult
In entrepot trade, if country B only provides transportation and warehousing services, then the country of origin is definitely country A. If country B conducts deep processing and changes the nature of the goods, it's another matter.
Amanda YangYears of service：3Customer Rating：5.0
Cost control consultantConsult
It mainly depends on what is done in country B. If it's just a short - term stop for transshipment without processing, the country of origin is country A. If the processing in country B makes the goods "completely transformed", the country of origin may change to country B.
William YangYears of service：5Customer Rating：5.0
International logistics consultantConsult
If there is no substantial change such as a change in tariff classification of the goods in country B, the country of origin is country A. Small operations like changing the packaging or sticking a label don't count as substantial changes.
Sarah ZhangYears of service：8Customer Rating：5.0
Document expertConsult
Generally speaking, if there is no processing or the processing doesn't constitute a substantial change, country A is the country of origin. For example, if the goods are just re - sorted in country B, the country of origin is still country A.
David LiYears of service：6Customer Rating：5.0
Senior customs declaration consultantConsult
In entrepot trade, if country B doesn't conduct deep processing on the goods and just transships them, the country of origin is still country A. For example, the goods just dock at the port of country B and then are shipped to country C.
Michelle ChenYears of service：3Customer Rating：5.0
Business coordination consultantConsult
The key is to look at how country B handles the goods. If there is no processing that changes the essential characteristics of the goods, country A is the country of origin.
Jennifer WangYears of service：4Customer Rating：5.0
Market development consultantConsult
If the goods are just normally transshipped in country B without processing that changes the characteristics of the goods, the country of origin is country A, which is a common situation.
Joseph ZhouYears of service：10Customer Rating：5.0
Senior foreign trade managerConsult
In entrepot trade, if there is no substantial processing in country B, the country of origin of the goods is country A, and the judgment of substantial processing is based on the rules of each country.