(e) lubricants, greases, compounding materials and other materials used in production or used to operate equipment and buildings;
(f) gloves, glasses, footwear, clothing, safety equipment and supplies;
(g) any other material that is not incorporated into the product but the use of which can be demonstrated to be part of the production of the product.
Article 3.11. Packaging and Packing Materials and Containers
1. If, under General Rule 5 for the Interpretation of the Harmonized System, packaging materials and containers in which a product is packed for retail sale are classified together with the product, those packaging materials and containers shall be disregarded in determining the origin of the product, except for the purposes of calculating the maximum value of non-originating materials if a product is subject to a maximum value of non-originating materials in accordance with Annex 3-B.
2. Packing materials and containers that are used to protect a product during transportation shall be disregarded in determining whether a product is originating in a Party.
Article 3.12. Accounting Segregation for Fungible Materials
1. Fungible originating and non-originating materials shall be physically segregated during storage in order for them to maintain their originating or non-originating status, as the case may be. Those materials may be used in the production of a product without being physically segregated during storage provided that an accounting segregation method is used.
2. The accounting segregation method referred to in paragraph 1 shall be applied in conformity with a stock management method under accounting principles which are generally accepted in the Party. The accounting segregation method shall ensure that at any time the number of products which could be considered as originating in a Party does not exceed the number that would have been obtained by physical segregation of the stocks during storage.
3. For the purposes of paragraph 1, "fungible materials" means materials that are of the same kind and commercial quality, with the same technical and physical characteristics, and which cannot be distinguished from one another once they are incorporated into the finished product.
Article 3.13. Returned Products
If a product originating in a Party is exported from that Party to a third country and returns to that Party, it shall be considered as non-originating unless it can be demonstrated to the satisfaction of the customs authority of that Party that the returning product:
(a) is the same as that exported; and
(b) has not undergone any operation other than that necessary to preserve it in good condition while in the third country or while being exported.
Article 3.14. Non-alteration
1. An originating product declared for home use in the importing Party shall not, after exportation and prior to being declared for home use, be altered, transformed in any way or subjected to operations other than to preserve it in good condition or to add or affix marks, labels, seals or any other documentation to ensure compliance with specific domestic requirements of the importing Party.
2. Storage or exhibition of a product may take place in a third country provided it remains under customs supervision in that third country.
3. Without prejudice to Section B, the splitting of consignments may take place in the territory of a third country if it is carried out by the exporter or under its responsibility and provided that those consignments remain under customs supervision in the third country.
4. In the case of doubt as to whether the conditions provided for in paragraphs 1 to 3 have been complied with, the customs authority of the importing Party may request the importer to provide evidence of compliance. Such evidence may be given by any means, including contractual transport documents such as bills of lading or factual or concrete evidence based on marking or numbering of packages, or any evidence related to the product itself.
Article 3.15. Exhibitions
1. Originating products sent for exhibition in a third country and sold after the exhibition for importation in a Party shall benefit on importation in accordance with this Agreement provided that it is shown to the satisfaction of the customs authorities that:
(a) an exporter has consigned those products from a Party to the third country in which the exhibition was held and has exhibited them there;
(b) the products have been sold or otherwise disposed of by that exporter to a person in a Party;
(c) the products have been consigned during the exhibition or immediately thereafter in the state to which they were sent for exhibition; and
(d) the products have not, since their consignment for exhibition, been used for any purpose other than demonstration at the exhibition.
2. A statement on origin shall be made out in accordance with Section B and submitted to the customs authorities in accordance with the customs procedures of the importing Party. The name and address of the exhibition shall be indicated thereon.
3. Paragraph 1 applies to any trade, industrial, agricultural or crafts exhibition, fair or similar public show or display, which is not organised for private purposes in shops or business premises with a view to the sale of foreign products, and during which the products remain under customs control.
4. The customs authorities of the importing Party may require evidence that the products have remained under customs control in the country of exhibition, as well as additional documentary evidence of the conditions under which they have been exhibited.
Section B. ORIGIN PROCEDURES
Article 3.16. Claim for Preferential Tariff Treatment
1. The importing Party shall grant preferential tariff treatment to a product originating in the other Party within the meaning of this Chapter on the basis of a claim by the importer for preferential tariff treatment. The importer shall bear the responsibility for the correctness of the claim for preferential tariff treatment and for compliance with the requirements set out in this Chapter.
2. The claim for preferential tariff treatment shall be based on one of the following:
(a) a statement on origin made out by the exporter in accordance with Article 3.17;
(b) the importer's knowledge subject to the conditions set out in Article 3.19.
3. The claim for preferential tariff treatment and the basis for that claim as referred to in paragraph 2 shall be included in the customs declaration, in accordance with the laws and regulations of the importing Party.
4. An importer making a claim for preferential treatment based on a statement on origin in accordance with subparagraph (a) of paragraph 2 shall keep the statement and shall present it to the customs authority of the importing Party upon request.
Article 3.17. Statement on Origin
1. An exporter of a product shall make out a statement on origin on the basis of information demonstrating that the product is originating, including, if applicable, information on the originating status of materials used in the production of the product.
2. The exporter shall be responsible for the correctness of the statement on origin made out and the information provided pursuant to paragraph 1. If the exporter has reason to believe that the statement on origin contains or is based on incorrect information, the exporter shall immediately notify the importer of any change affecting the originating status of the product. In that event, the importer shall correct the import declaration and pay any applicable customs duty owing.
3. The exporter shall make out a statement on origin in one of the linguistic versions included in Annex 3-C on an invoice or on any other commercial document that describes the originating product in sufficient detail so as to enable its identification in the Harmonized System nomenclature. The importing Party shall not require the importer to submit a translation of the statement on origin.
4. A statement on origin shall be valid for one year from the date it was made out.
5. A statement on origin may be made out for:
(a) a single shipment of one or more products into a Party; or
(b) multiple shipments of identical products into a Party within the period specified in the statement on origin not exceeding 12 months.
6. The importing Party shall, on request of the importer and subject to any requirements imposed by the importing Party, allow a single statement on origin to be used for unassembled or disassembled products, within the meaning of General Rule 2(a) of the Harmonized System, classified under Sections XV to XXI of the Harmonized System if imported in instalments.
Article 3.18. Minor Discrepancies and Minor Errors
The customs authority of the importing Party shall not reject a claim for preferential tariff treatment due to minor discrepancies between the statement on origin and the documents submitted to the customs office, or minor errors in the statement on origin.
Article 3.19. Importer's Knowledge
1. The importing Party may, in its laws and regulations, set conditions to determine which importers may base a claim for preferential tariff treatment on the importer's knowledge.
2. Notwithstanding paragraph 1, the importer's knowledge that a product is originating shall be based on information demonstrating that the product effectively qualifies as originating and meets the requirements set out in this Chapter to obtain originating status.
Article 3.20. Record-keeping Requirements
1. An importer claiming preferential tariff treatment for a product imported into a Party shall:
(a) if the claim for preferential treatment is based on a statement on origin, keep the statement on origin made out by the exporter for a minimum of three years from the date of the claim of preference of the product; and
(b) if the claim for preferential treatment is based on the importer's knowledge, keep the information demonstrating that the product meets the requirements set out in this Chapter to obtain originating status for a minimum of three years from the date of the claim for preferential treatment.
2. An exporter who made out a statement on origin shall, for a minimum of four years following the making out of that statement on origin, keep copies of the statement on origin and all other records demonstrating that the product meets the requirements set out in this Chapter to obtain originating status.
3. The records to be kept in accordance with this Article may be held in electronic form in accordance with the laws and regulations of the importing or exporting Party, as appropriate.
Article 3.21. Exemptions from the Requirements Regarding Statements on Origin
1. Products sent as packages from private persons to private persons or forming part of the personal luggage of travellers shall be admitted as originating products without a statement on origin being required, provided that such products are not imported by way of trade and have been declared as meeting the requirements of this Chapter, and that there is no doubt as to the veracity of that declaration.
2. Imports which are occasional and consist solely of products for the personal use of the recipients or travellers or their families shall not be considered as imports by way of trade if it is evident from the nature and quantity of the goods that no commercial purpose is intended, provided that the importation does not form part of a series of importations that may reasonably be considered to have been made separately for the purpose of avoiding the requirement for an statement on origin.
3. The total value of the products referred to in paragraph 1 shall not exceed EUR 500 or its equivalent amount in the currency of the Party in the case of packages, or EUR 1 200 or its equivalent amount in the currency of the Party in the case of products forming part of the personal luggage of travellers.
Article 3.22. Verification
1. The customs authority of the importing Party may verify the originating status of a product or whether the other requirements set out in this Chapter are met on the basis of risk assessment methods, which may include random selection. For the purposes of such verification, the customs authority of the importing Party may send a request for information to the importer who made the claim for preferential treatment pursuant to Article 3.16.
2. The customs authority of the importing Party sending a request pursuant to paragraph 1 shall not request more than the following information in relation to the origin of a product:
(a) the statement on origin if the claim for preferential treatment was based on a statement on origin; and
(b) information pertaining to the fulfilment of origin criteria, which is:
(i) if the origin criterion is "wholly obtained", the applicable category (such as harvesting, mining, fishing) and place of production;
(ii) if the origin criterion is based on a change in tariff classification, a list of all the non- originating materials including their tariff classification (in 2-, 4- or 6-digit format, depending on the origin criteria);
(iii) if the origin criterion is based on a value method, the value of the final product as well as the value of all the non-originating materials used in the production;
(iv) if the origin criterion is based on weight, the weight of the final product as well as the weight of the relevant non-originating materials used in the final product; and
(v) if the origin criterion is based on a specific production process, a description of that specific process.
3. When providing the requested information, the importer may add any other information that it considers relevant for the purposes of verification.
4. If the claim for preferential tariff treatment is based on a statement on origin in accordance with subparagraph (a) of Article 3.16(2) issued by the exporter, the importer shall provide that statement on origin but may reply to the customs authority of the importing Party indicating that the information referred to in subparagraph (b) of paragraph 2 of this Article cannot be provided.
5. Where the claim for preferential tariff treatment is based on the importer's knowledge referred to in subparagraph (b) of Article 3.16(2), the customs authority of the importing Party conducting the verification may, after having requested information pursuant to paragraph 1 of this Article, send an additional request for information to the importer if that customs authority considers that additional information is required in order to verify the originating status of the product or whether the other requirements set out in this Chapter are met. The customs authority of the importing Party may request specific documentation and information from the importer, if appropriate.
6. If the customs authority of the importing Party decides to suspend the granting of preferential tariff treatment to the products concerned while awaiting the results of a verification, it may offer the importer the possibility to release the products. As a condition for such release, the importing Party may require a guarantee or other appropriate precautionary measure. Any suspension of preferential tariff treatment shall be terminated as soon as possible after the customs authority of the importing Party has ascertained the originating status of the products concerned, or that the other requirements set out in this Chapter have been met.
Article 3.23. Administrative Cooperation
1. In order to ensure the proper application of this Chapter, the Parties shall cooperate with each other, through their respective customs authorities, in order to verify the originating status of a product or whether the other requirements set out in this Chapter have been met.
2. If a claim for preferential tariff treatment is based on a statement on origin in accordance with subparagraph (a) of Article 3.16(2), the customs authority of the importing Party conducting the verification may, after having requested information from the importer pursuant to Article 3.22(1), send a request for information to the customs authority of the exporting Party within a period of two years following the date of the claim for preferential treatment, if the customs authority of the importing Party considers that additional information is needed in order to verify the originating status of the product or whether the other requirements set out in this Chapter have been met. The customs authority of the importing Party may request specific documentation and information from the customs authority of the exporting Party, if appropriate.
3. The customs authority of the importing Party shall include the following information in the request referred to in paragraph 2:
(a) the statement on origin or a copy thereof;
(b) the identity of the customs authority issuing the request;
(c) the name of the exporter to be verified;
(d) the subject and scope of the verification; and
(e) if applicable, any relevant documentation.
4. The customs authority of the exporting Party may, in accordance with the laws and regulations of that Party, conduct its verification by requesting documentation from the exporter and calling for any evidence, or by visiting the premises of the exporter to review records and observe the facilities used in the production of the product.
5. Following the request referred to in paragraph 2, the customs authority of the exporting Party shall provide the customs authority of the importing Party with the following information:
(a) the requested documentation, if available;
(b) an opinion regarding the originating status of the product;
(c) the description of the product subject to verification and the tariff classification relevant to the application of the rules of origin;
(d) a description and explanation of the production process to support the originating status of the product;
(e) information on the manner in which the verification of the originating status of the product pursuant to paragraph 4 was conducted; and
(f) supporting documentation, if appropriate.
6. The customs authority of the exporting Party shall not transmit information to the customs authority of the importing Party referred to in subparagraph (a) or (f) of paragraph 5 without the consent of the exporter.
7. All the information requested, including any supporting documents and all other related information regarding verification should preferably be exchanged electronically between the customs authorities of the Parties.
8. The Parties shall, via the coordinators designated in accordance with this Agreement, provide each other with the contact details of their respective customs authorities and any modification thereto within 30 days of such modification.
Article 3.24. Mutual Assistance In the Fight Against Fraud
In case of a suspected breach of this Chapter, the Parties shall provide each other with mutual assistance, in accordance with the Protocol to this Agreement on Mutual Administrative Assistance in Customs Matters.
Article 3.25. Denial of Claims for Preferential Tariff Treatment
1. Subject to the requirements set out in paragraphs 3 to 5, the customs authority of the importing Party may deny a claim for preferential tariff treatment if:
(a) within a period of three months following the request for information pursuant to Article 3.22(1):
(i) no reply is provided by the importer;
(ii) in cases where the claim for preferential tariff treatment is based on a statement on origin in accordance with subparagraph (a) of Article 3.16(2), the statement on origin was not provided; or
(iii) in cases where the claim for preferential tariff treatment is based on the importer's knowledge as referred to in subparagraph (b) of Article 3.16(2), the information provided by the importer is inadequate to confirm the originating status of the product;
(b) within a period of three months following the request for additional information pursuant to Article 3.22(5):
(i) no reply is provided by the importer; or
(ii) the information provided by the importer is inadequate to confirm that the product is originating;
(c) within a period of 10 months following the request for information pursuant to of Article 3.23(2):
(i) no reply is provided by the customs authority of the exporting Party; or
(ii) the information provided by the customs authority of the exporting Party is inadequate to confirm the originating status of the product.
2. The customs authority of the importing Party may deny a claim for preferential tariff treatment if the importer which has made that claim fails to comply with requirements set out in this Chapter other than those relating to the originating status of products.
3. If the customs authority of the importing Party has sufficient justification to deny a claim for preferential tariff treatment in accordance with paragraph 1 of this Article and where the customs authority of the exporting Party has provided an opinion pursuant to subparagraph (b) of
Article 3.23(5) confirming the originating status of the products, the customs authority of the importing Party shall notify the customs authority of the exporting Party of its intention to deny the claim for preferential treatment within two months of the receipt of that opinion.
4. If the notification referred to in paragraph 3 has been made, consultations shall be held on request of either Party, within three months of the date of that notification. The time period for consultation may be extended on a case-by-case basis by mutual agreement between the customs authorities of the Parties. The consultation may take place in line with the procedure set by the Sub-Committee referred to in Article 3.31.
5. Upon the expiry of the time period for consultation, the customs authority of the importing Party shall deny the claim for preferential tariff treatment only if it is not able to confirm the originating status of the product and after having granted the importer the right to be heard.
Article 3.26. Confidentiality
1. Each Party shall maintain, in accordance with its laws and regulations, the confidentiality of information provided to it by the other Party pursuant to this Chapter, and shall protect that information from disclosure.
2. Information obtained by the authorities of the importing Party shall only be used by those authorities for the purposes of this Chapter.
3. Each Party shall ensure that confidential information collected pursuant to this Chapter is not used for purposes other than the administration and enforcement of decisions and determinations relating to the origin of products and customs matters, except with the permission of the person or Party who provided the confidential information.
4. Notwithstanding paragraph 3, a Party may allow information collected pursuant to this Chapter to be used in any administrative, judicial or quasi-judicial proceedings initiated for failure to comply with customs-related laws and regulations implementing this Chapter. A Party shall notify the person or Party that provided the information concerned of any such use in advance.
Article 3.27. Refunds and Claims for Preferential Tariff Treatment after Importation
1. Each Party shall provide that an importer may make, after importation, a claim for preferential tariff treatment and for a refund of any excess duties paid for a product if:
(a) the importer did not make a claim for preferential tariff treatment at the time of importation;
(b) the claim is made no later than two years after the date of importation; and
(c) the product concerned was eligible for preferential tariff treatment when it was imported into the territory of the Party.
2. As a condition for preferential tariff treatment on the basis of a claim made pursuant to paragraph 1, the importing Party may require that the importer:
(a) makes a claim for preferential tariff treatment in accordance with the laws and regulations of the importing Party;
(b) provides the statement on origin, as appropriate; and
(c) satisfies all other applicable requirements set out in this Chapter in the same manner as if preferential tariff treatment had been claimed at the time of importation.
Article 3.28. Administrative Measures and Sanctions
1. A Party shall impose administrative measures and sanctions where appropriate, in accordance with its respective laws and regulations, on a person that draws up a document, or causes a document to be drawn up, which contains incorrect information for the purposes of obtaining preferential tariff treatment for a product, or that does not comply with the requirements set out in:
(a) Article 3.20;
(b) Article 3.23(4) by not providing evidence or refusing a visit; or
(c) Article 3.17(2) by not correcting a claim for preferential tariff treatment made in the customs declaration and paying the custom duty as appropriate, if the initial claim for preference was based on incorrect information.
2. The Party shall take into account paragraph 3.6 of Article 6 of the Agreement on Trade Facilitation in Annex 1A to the WTO Agreement in cases where an importer voluntarily discloses a correction to a claim for preferential treatment prior to receiving a verification request, in accordance with the laws and regulations of that Party.
Section C. FINAL PROVISIONS
Article 3.29. Ceuta and Melilla
1. For the purposes of this Chapter, for the European Union, the term "Party" does not include Ceuta and Melilla.
2. Products originating in Chile shall, when imported into Ceuta and Melilla, in all respects be granted the same customs treatment under this Agreement as that which is granted to products originating in the customs territory of the European Union under Protocol 2 of the Act of Accession of the Kingdom of Spain and the Portuguese Republic to the European Union. Chile shall grant to imports of products covered by this Agreement and originating in Ceuta and Melilla the same customs treatment as that which is granted to products imported from and originating in the European Union.
3. The rules of origin and origin procedures under this Chapter apply mutatis mutandis to products exported from Chile to Ceuta and Melilla and to products exported from Ceuta and Melilla to Chile.
4. Ceuta and Melilla shall be considered as a single territory.
5. Article 3.3 applies to import and exports of products between the European Union, Chile and Ceuta and Melilla.
6. The exporter shall enter "Chile" and "Ceuta and Melilla" in field 3 of the text of the statement on origin in Annex 3-C, depending on the origin of the product.
7. The customs authority of the Kingdom of Spain shall be responsible for the application of this Article in Ceuta and Melilla.
Article 3.30. Amendments
The Trade Council may adopt decisions to amend this Chapter and Annexes 3-A to 3-E, pursuant to subparagraph (a) of Article 33.1(6).
Article 3.31. Sub-Committee on Customs, Trade Facilitation and Rules of Origin
1. The Sub-Committee on Customs, Trade Facilitation and Rules of Origin ("Sub-Committee"), established pursuant to Article 33.4(1), shall be composed of representatives of the Parties with responsibility for customs.
2. The Sub-Committee shall be responsible for the effective implementation and application of this Chapter.
3. For the purposes of this Chapter, the Sub-Committee shall have the following functions:
(a) reviewing and making appropriate recommendations, as necessary, to the Trade Committee on:
(i) the implementation and application of this Chapter; and