The Legal Basis of Origin Certification
Determining and certifying the origin of goods is one of the fundamental institutions of customs law. Under the current Tax Code, origin is determined upon the introduction of goods into, or their export from, the customs territory of Georgia for the purpose of applying protective trade measures. Article 24 of the same Code gives foreign trade participants the possibility of obtaining advance decisions on commodity classification and origin, and the Minister of Finance is empowered to define further cases in which advance decisions on other factors are issued.
The practical significance of origin certification is that a properly executed document determines the customs-tariff regime of the goods: the amount of import duty, access to preferential benefits, and the application of non-tariff measures. An error in determining origin means re-qualification, additional charges and often administrative liability as well.
Non-Preferential and Preferential Origin
Origin may be non-preferential or preferential. Non-preferential origin is used for import duty purposes — save where benefits under an international treaty apply — and for applying non-tariff regulatory measures of foreign trade. Goods acquire non-preferential origin and are considered to originate in the country where they were wholly obtained, or where they underwent their last substantial transformation when more than one country participated in their production.
The criteria and procedure for determining preferential origin, as well as the form of the document confirming preferential origin and the rules for completing it, are determined by the relevant international treaty of Georgia. This means that for each trade regime the requirements of the applicable agreement must be verified separately — a step exporters skip at their peril.
Confirmation and Customs Control
Where a customs declaration indicates information on the country of origin, the customs authority may request the declarant to confirm origin. Where confirmation is required by legislation, and a reasonable doubt exists, the customs authority may request additional evidence to satisfy itself that the information on origin is indicated according to the applicable rules of determination. The procedures for issuing confirmation documents for goods bearing Georgian origin status are regulated by government decree.
For an exporter this means: every figure in the declaration must be documented. The reasonable-doubt standard allows the customs service a broad inquiry, so production documents, supply chain evidence and descriptions of technological processes must be ready.