The Customs (Origin of Chargeable Goods) (EU Exit) Regulations 2020

Made: at 12.24 p.m. on 15th December 2020

Laid before the House of Commons: 16th December 2020

Coming into force in accordance with regulation 1

The Treasury, in exercise of the powers conferred by sections 17(6), 32(7), 37(3)(b) and 52(2) of, and paragraph 1(3)(c) of Schedule 7 to, the Taxation (Cross-border Trade) Act 2018 , make the following Regulations.

The Treasury consider it appropriate in consequence of, or otherwise in connection with, the withdrawal of the United Kingdom from the European Union that the following Regulations come into force on such day as the Treasury may by regulations under section 52 of that Act appoint.

The Secretary of State has recommended that, in accordance with section 17(8) of that Act, the following Regulations be made.

PART 1 — Preliminary

Citation and commencement

1

These Regulations may be cited as the Customs (Origin of Chargeable Goods) (EU Exit) Regulations 2020 and come into force on such day as the Treasury may by regulations under section 52 of the Act appoint.

Interpretation

2

In these Regulations—

• “the Act” means the Taxation (Cross-border Trade) Act 2018;

• “Rules of Origin” means the document entitled “Rules of Origin: Special Rules for Determining Non-Preferential Origin, version 1.2 dated 12th April 2023” which comprises the following as are so named in that document—Part One (goods wholly obtained in a single country or territory);Part Two (operations not constituting an important stage of manufacture);Part Three (accessories, spare parts or tools); andPart Four (product specific rules);

• “Second General Rule” means the rule of origin of goods provided by section 17(3) of the Act.

Effect

3

These Regulations have effect for the purposes of Part 1, except sections 9 and 10, of the Act.

PART 2 — Provision in relation to the Second General Rule

Processing that is not economically justified

4

Processing of goods is not economically justified only in cases where a person causes the goods to be processed to obtain a place of origin of the goods different from that which would otherwise have applied had the processing not occurred with the purpose of—

• (a) reducing the amount of import duty which would otherwise have applied to the goods; or

• (b) avoiding or mitigating a provision imposed by or under an enactment which would otherwise have applied to the goods, including provision imposing—

• (i) a quota or other restriction on import;

• (ii) a prohibition on import; or

• (iii) a tax, duty or charge.

Materials that do not form part of the final composition of goods

5

In determining whether or not goods are obtained in two or more countries or territories , regard must not be had to the country or territory of origin of materials that are used in the course of manufacture of the goods but do not form part of the final composition of the goods.

Cases and containers

6

• (1) Paragraph (2) applies to goods (“rule 5 goods”) where, by virtue of rule 5 of Part Two (Goods Classification Table Rules of Interpretation) of the Tariff of the United Kingdom, cases or containers of rule 5 goods are classified with the goods.

• (2) Where the Second General Rule applies to rule 5 goods, the goods are to be regarded as originating in a country or territory according to the Second General Rule disregarding the cases or containers.

• (3) In paragraph (1), “Tariff of the United Kingdom” has the same meaning as it has in the Customs Tariff (Establishment) (EU Exit) Regulations 2020 .

Origin determined by reference to value of materials

7

• (1) Paragraph (2) applies to goods where—

• (a) were it not for this regulation, the Second General Rule would apply to the goods; and

• (b) the goods would not be regarded as originating in a country or territory where the goods are processed because, by virtue of regulation 4, that processing is not economically justified.

• (2) The goods are not to be regarded as originating in a country or territory according to the Second General Rule but instead as originating in the country or territory from which originates the greater or greatest proportion by value of the materials within the final composition of the goods.

• (3) For the purposes of paragraph (2)—

• (a) the value of a material is to be determined at the time the goods are imported; or

• (b) if that value cannot be readily determined, the amount which was paid for the material is to be treated as its value.

PART 3 — Provision contained within the Rules of Origin

Goods wholly obtained in a country or territory: specified cases

8

Goods that fall within a description of goods given in Part One of the Rules of Origin are to be regarded as wholly obtained in a country or territory according to the rule applicable to the goods set out in that Part.

Operations not constituting an important stage of manufacture

9

The operations set out in Part Two of the Rules of Origin which may be applied to goods do not constitute an important stage of manufacture .

Accessories, spare parts and tools

10

• (1) Paragraph (2) applies to goods which are accessories, spare parts or tools that fall within a description of goods given in Part Three of the Rules of Origin and to which, were it not for this regulation, the Second General Rule would apply.

• (2) The goods are not to be regarded as originating in a country or territory according to the Second General Rule but instead as originating in a country or territory according to the rule applicable to the goods set out in Part Three of the Rules of Origin.

Application of the product specific rules

11

• (1) Paragraph (2) applies to goods that fall within a description of goods given in Part Four of the Rules of Origin and to which, were it not for this regulation, the Second General Rule would apply.

• (2) The goods are not to be regarded as originating in a country or territory according to the Second General Rule but instead as originating in a country or territory according to the product specific rules set out in Part Four of the Rules of Origin.

Signed

David Rutley — Maggie Throup — Two of the Lords Commissioners of Her Majesty's Treasury

Explanatory note

(This note is not part of the Regulations)

Footnotes

[^f00001]: 2018 c. 22.

[^f00002]: Available in electronic form at https://www.gov.uk/government/collections/customs-vat-and-excise-uk-transition-legislation-from-1-january-2021. A person unable to access the document electronically can arrange access to a hard copy, while government advice on social distancing and unnecessary travel applies, by calling 020 7270 5000, and otherwise by inspection free of charge at HMRC, 100 Parliament Street, London SW1A 2BQ.

[^f00003]: The Second General Rule includes a requirement that processing of goods must be economically justified.

[^f00004]: The Second General Rule applies if goods are obtained in two or more countries or territories.

[^f00005]: S.I. 2020/1430.

[^f00006]: Section 17(2) of the Act provides that goods are to be regarded as originating from a country or territory if they are wholly obtained in the country or territory.

[^f00007]: Section 17(4) of the Act provides that processing of goods is to be regarded as substantial only if it represents an important stage of manufacture or results in the manufacture of a new product.

Editorial notes

[^c24378491]: 2018 c. 22.

[^c24378511]: The Second General Rule includes a requirement that processing of goods must be economically justified.

[^c24378521]: The Second General Rule applies if goods are obtained in two or more countries or territories.

[^c24378531]: S.I. 2020/1430.

[^c24378541]: Section 17(2) of the Act provides that goods are to be regarded as originating from a country or territory if they are wholly obtained in the country or territory.

[^c24378551]: Section 17(4) of the Act provides that processing of goods is to be regarded as substantial only if it represents an important stage of manufacture or results in the manufacture of a new product.

[^key-20036b51f3bf7ca91959a818fc296ab8]: Reg. 1 in force at 31.12.2020 by S.I. 2020/1643, reg. 2, Sch.

[^key-5cb847d72b27100d3cfb51d0f6067f77]: Reg. 2 in force at 31.12.2020 by S.I. 2020/1643, reg. 2, Sch.

[^key-a883c23dcab68111ae28ee4de8168fc2]: Reg. 3 in force at 31.12.2020 by S.I. 2020/1643, reg. 2, Sch.

[^key-60e87e44ab535c734c60e77912bbe901]: Reg. 4 in force at 31.12.2020 by S.I. 2020/1643, reg. 2, Sch.

[^key-9c37da64d916cfeeba1897750a88f1bf]: Reg. 5 in force at 31.12.2020 by S.I. 2020/1643, reg. 2, Sch.

[^key-d6f18968f0a33212975166e3863ed5fc]: Reg. 6 in force at 31.12.2020 by S.I. 2020/1643, reg. 2, Sch.

[^key-a660f14b729db3a611672866ddd91eb7]: Reg. 7 in force at 31.12.2020 by S.I. 2020/1643, reg. 2, Sch.

[^key-96b699f4819af0cebab4156499c3ce2b]: Reg. 8 in force at 31.12.2020 by S.I. 2020/1643, reg. 2, Sch.

[^key-88f15f2082b64999b177baa858fc7380]: Reg. 9 in force at 31.12.2020 by S.I. 2020/1643, reg. 2, Sch.

[^key-d5dc403cf95a1375542033d0f9bb8495]: Reg. 10 in force at 31.12.2020 by S.I. 2020/1643, reg. 2, Sch.

[^key-d52812e7d4b5535f42343fda8f928be3]: Reg. 11 in force at 31.12.2020 by S.I. 2020/1643, reg. 2, Sch.

[^key-1c869249ac14d05e142101c232a25c3f]: Words in reg. 2 substituted (10.5.2023) by The Customs Tariff (Preferential Trade Arrangements and Miscellaneous Amendments) Regulations 2023 (S.I. 2023/433), regs. 1(2), 4