(h) assessing matters that relate to trade in goods and undertaking any additional work that the Joint Committee may assign to it; and
(i) reviewing and monitoring any other matter related to the implementation of this chapter.
Chapter 3. RULES OF ORIGIN
Article 3.1. Definitions
For the purposes of this Chapter:
(a) aquaculture refers to the farming of aquatic organisms including fish, molluscs, crustaceans, other aquatic invertebrates and aquatic plants, from seedstock such as eggs, fry, fingerlings and larvae, by intervention in the rearing or growth processes to enhance production, such as, inter alia, regular stocking, feeding, protection from predators;
(b) competent authority refers to:
(i) for the UAE, the Ministry of Economy or any other agency notified from time to time;
(ii) for Mauritius, the Customs Department of the Mauritius Revenue Authority;
(c) consignment means products which are either sent simultaneously from one exporter to one consignee or covered by a single transport document covering their shipment from the exporter to the consignee or, in the absence of such a document, by a single invoice;
(d) customs authority refers to:
(i) for the UAE, the Federal Authority of Identity, Citizenship, Customs and Port Security;
(ii) for Mauritius, the Customs Department of the Mauritius Revenue Authority;
(e) customs value means the value of imported goods as determined in accordance with the Customs Valuation Agreement;
(f) exporter means any natural or legal person who exports goods to the territory of another Party, who is able to prove the origin of the goods, whether or not that person is the manufacturer and whether or not that person carries out the export formalities;
(g) fungible materials mean materials which are interchangeable for commercial purposes, whose properties are essentially identical, and between which it is impractical to differentiate by a mere visual examination;
(h) generally accepted accounting principles refers to the recognised consensus or substantial authoritative support in the territory of a Party, with respect to the recording of revenues, expenses, costs, assets, and liabilities, the disclosure of information and the preparation of financial statements. These standards may encompass broad guidelines of general application as well as detailed standards, practices and procedures;
(i) good refers to any article of trade including materials and products;
(j) indirect material refers to a material used in the production, testing, or inspection of a good but not physically incorporated into the good, or the operation of equipment associated with the production of a good;
(k) material refers to any ingredient, raw material, compound, component or part, etc., used in the production of a good;
(l) non-originating good/ non-originating material refers to a good or material that does not qualify as originating under this Chapter;
(m) originating goods / originating material refers to goods or materials that qualify as originating under this Chapter;
(n) product refers to that which is obtained by growing, raising, mining, harvesting, fishing, aquaculture, trapping, hunting, extracting or manufactured, even if it is intended for later use in another manufacturing operation;
(o) production refers to obtaining a good through growing, raising, mining, harvesting, fishing, aquaculture, trapping, hunting, manufacturing, processing, assembling a good;
(p) territory means the territory as defined in Article 1.4 (Geographical Scope).
Section A. Origin Determination
Article 3.2. Originating Goods
For the purpose of implementing this Agreement, goods shall be considered as originating in the territory of a Party, if:
(a) goods are wholly obtained or produced there according to Article 3.3; or
(b) goods are not wholly obtained or produced entirely there, provided that the good has undergone sufficient working or processing according to Article 3.4; or
(c) goods produced entirely there exclusively from originating materials, and the goods satisfied all other applicable requirements of this Chapter.
Article 3.3. Wholly Obtained or Produced Goods
For the purposes of paragraph (a) of Article 3.2, the following goods shall be deemed to be wholly obtained or produced in the territory of a Party:
(a) plant and plant products grown, collected or harvested there;
(b) live animals born and raised there;
(c) products obtained from live animals raised there;
(d) mineral product and natural resources extracted or taken from that Party's soil, subsoil, waters, seabed or beneath the seabed;
(e) product obtained from hunting, trapping, collecting, capturing, fishing or aquaculture conducted there;
(f) product of sea fishing and other marine products taken from outside the territorial waters of the Party by a vessel registered with a Party and flying its flag;
(g) products made on board a factory ship registered, with a Party and flying its flag, exclusively from products referred to in point (f);
(h) product, other than products of sea fishing and other marine products, taken or extracted from the seabed, ocean floor or the subsoil of the continental shelf or the exclusive economic zone of a Party by a Party or a Person of the Party, provided that the Party or Person of the Party has the right to exploit such seabed, ocean floor, or subsoil in accordance with international law;
(i) used articles collected there which are fit only for the recovery of raw materials;
(j) waste and scrap resulting from manufacturing operations conducted there, fit only for recovery of raw materials;
(k) product produced or obtained there exclusively from product referred to in subparagraphs (a) through (j), or from their derivatives, at any stage of production.
Article 3.4. Sufficient Working or Processing
1. For the purposes of paragraph (b) of Article 3.2, a good which is not wholly obtained in a Party shall be deemed to have undergone sufficient working or processing in the exporting Party and considered originating there when the conditions laid down in the list in Annex 3A on Product Specific Rules of Origin (hereinafter referred to as ?PSR?) for the concerned good are met.
2. The Qualifying Value Content (hereinafter referred to as ?QVC?) of a good, specified in the PSR (Annex 3A), shall be calculated by using the following formula:
(a) QVC = ExWorks price - V.N.M / ExWorks price * 100 where:
(i) Ex-Works price refers to the price paid for the good ex-works to the manufacturer in the Parties in whose undertaking the last working or processing is carried out, provided the price includes the value of all the materials used, minus any internal taxes which are, or may be, repaid when the good obtained is exported;
(ii) V.N.M. refers to the Customs
value of the non-originating materials at the time of importation including the cost of transport and insurance incurred in transporting the material to the destination port in the importing Party, or the earliest ascertained price paid or payable for the materials of undetermined origin in the Party where the production takes place for all non-originating materials, parts or produce that are acquired by the producer in the production of the good. When the producer of a good acquires non-originating materials within that Party the value of such materials shall not include freight, insurance, packing costs and any other costs incurred in transporting the material from the supplier?s warehouse to the producer?s location.
Article 3.5. Intermediate Goods
If a good which has obtained originating status in a Party in accordance with Article 3.4 is used as a material in the manufacture of another good, no account shall be taken of the non-originating materials which may have been used in its manufacture.
Article 3.6. Accumulation
1. A good originating in the territory of a Party, which is used in the territory of the other Party as material for a finished good eligible for preferential tariff treatment, shall be considered to be originating in the territory of the latter Party where working or processing of the finished good has taken place.
2. Notwithstanding paragraph 1, an originating good from a Party that does not undergo processing beyond the minimal or insufficient operations listed in Article 3.8 in the other Party shall retain its originating status of the former Party.
3. The Parties through the Joint Committee may agree to review this Article with a view to providing for other forms of accumulation for the purpose of qualifying goods as originating goods under this Agreement.
Article 3.7. Tolerance
1. Notwithstanding Article 3.4 and except as otherwise specified in Annex 3A, a good shall be considered to have undergone a change in tariff classification if the value of all non-originating materials that are used in the production of the good and that do not undergo the applicable change in tariff classification does not exceed 15% of the ex-works price of the good.
2. The value of non-originating materials referred to in paragraph 1 shall be included in the value of the non-originating materials for any applicable value-added content requirement.
3. For goods classified under Chapters 28 through 38 of the Harmonized System, materials of the same heading as the product may be used, provided that their total value does not exceed 20% of the ex-works price of the product.
Article 3.8. Insufficient Operations
1. Whether or not the requirements of Article 3.4 and Annex 3A are satisfied, the following operations shall be considered to be insufficient working or processing to confer originating status to a good irrespective of whether these operations are undertaken exclusively by itself or in combination in the territory of a Party:
(a) slaughter of animals;
(b) operations to ensure the preservation of products in good condition during transport and storage such as drying, freezing, ventilation, chilling and like operations;
(c) sifting, screening, simple classifying, sorting, washing, cutting, slitting, bending, coiling or uncoiling, sharpening, simple grinding, slicing (including making-up of sets of articles);
(d) cleaning, including removal of dust, oxide, oil, paint or other coverings;
(e) ironing or pressing of textiles and textile articles;
(f) simple painting and polishing operations;
(g) simple placing in bottles, cans, flasks, bags, cases, boxes, fixing on cards or boards and all other simple packaging operations;
(h) simple mixing of goods, whether or not of different kinds; mixing of sugar with other material;
(i) simple assembly of parts of products to constitute a complete good or disassembly of products into parts;
(j) changes of packing, unpacking or repacking operations, and breaking up and assembly of packages;
(k) affixing or printing marks, labels, logos and other like distinguishing signs on goods or their packaging;
(l) operations to colour or flavour sugar or form sugar lumps; partial or total milling of crystal sugar;
(m) peeling, stoning or shelling of fruits, nuts and vegetables;
(n) husking, partial or total bleaching, polishing and glazing of cereals and rice; and
(o) mere dilution with water or another substance that does not materially alter the characteristics of the goods.
2. For the purposes of paragraph 1 above, the term ?simple? shall be defined as following:
(a) "Simple" generally describes an activity which does not need special skills, machines, apparatus or equipment especially produced or installed for carrying out the activity;
(b) "Simple mixing" generally describes an activity which does not need special skills, machine, apparatus or equipment especially produced or installed for carrying out the activity. However, simple mixing does not include chemical reaction. Chemical reaction means a process (including a biochemical process) which results in a molecule with a new structure by breaking intramolecular bonds and by forming new intramolecular bonds, or by altering the spatial arrangement of atoms in a molecule.
Article 3.9. Indirect Materials
Any indirect material used in the production of a good shall be treated as originating material, irrespective of the origin of such indirect material. Indirect materials include the following:
(a) Fuel and energy;
(b) tools, dies, and molds;
(c) spare parts and materials used in the maintenance of equipment;
(d) lubricants, greases, compounding materials, and other materials used in production or used to operate equipment;
(e) gloves, glasses, footwear, clothing, and safety equipment and supplies;
(f) equipment, devices, supplies used for testing or inspecting the goods;
(g) catalysts and solvents; and
(h) any other material that is not incorporated into the good but for which the use in the production of the good can reasonably be demonstrated to be a part of that production.
Article 3.10. Accessories, Spare Parts, Tools
1. Accessories, spare parts, tools, and instructional or other information materials delivered with a good that form part of the good's standard accessories, spare parts, tools, and instructional or other information materials shall be regarded as a part of the good, and shall be disregarded in determining whether or not all the non-originating materials used in the production of the originating goods undergo the applicable change in tariff classification provided that:
(a) The accessories, spare parts, tools, and instructional or other information materials are classified with and not invoiced separately from the good; and
(b) The quantities and values of the accessories, spare parts, tools, and instructional or other information materials presented with the good are customary for the good.
2. Notwithstanding paragraph 1, if the goods are subject to QVC requirement, the value of the accessories, spare parts, tools and instructional or other information materials shall be taken into account as originating or non-originating materials, as the case may be, in calculating the qualifying value content of the goods.
Article 3.11. Treatment of Packages and Packing Materials and Containers
1. Each Party shall provide that packages and packing materials and containers in which a good is packed for retail sale, if classified with the good, according to Rule 5(b) of the General Rules for the Interpretation of the Harmonized System, shall be disregarded in determining the origin of the goods.
2. Notwithstanding paragraph 1, where the good is subject to qualifying value content requirement, the value of such packages, packing materials and containers shall be taken into account as originating or non-originating materials, as the case may be, in calculating the qualifying value content of the goods.
3. The containers and packing materials exclusively used for the transport of a product shall not be taken into account for determining the origin of the product.
Article 3.12. Fungible Goods or Materials
1. Each Party shall provide that the determination of whether fungible goods or materials are originating shall be made through physical segregation of each good or material, or, in case of any difficulty, through the use of any inventory management method, such as averaging, last-in, first-out, or first-in, first out, recognised in the generally accepted accounting principles of the Party in which the product is produced.
2. Each Party shall provide that for particular fungible goods or materials, an inventory management method selected under paragraph 1, shall continue to be used throughout the fiscal year of the Party that selected the inventory management method.
3. The method chosen must permit a clear distinction to be made between originating and non-originating materials including materials of undetermined origin acquired and/or kept in stock.
4. A producer using an inventory management system shall keep records of the operation of the system that are necessary for the competent authority of the Party concerned to verify compliance with the provisions of this Chapter.
5. The Parties may require that the application of inventory management method is subject to prior authorization by the competent authorities. The competent authorities may grant authorization subject to any conditions they deemed appropriate and shall monitor the use made of the authorization.
Article 3.13. Sets of Goods
Sets, as defined in Rule 3 of the General Rules for the Interpretation of the Harmonized System, shall be regarded as originating when all component goods are originating. However, when a set is composed of originating and non-originating products, the set as a whole shall be regarded as originating, provided that the value of non-originating products does not exceed 15% of the ex-works price of the set.
Section B. Territoriality and Transit
Article 3.14. Transport and Transit
1. Each Party shall provide that an originating good retains its originating status if the good has been transported directly to the importing Party without passing through the territory of a non-Party.
2. Notwithstanding Paragraph 1, each Party shall provide that an originating good retains its originating status if transited through or is stored in a temporary warehousing in one or more territories of non-Parties, provided that the:
(a) transit entry of the good is justified for geographical reason or by consideration related exclusively to transport requirements; and
(b) good remained under customs control in the territory of a non-Party; and
(c) good has not entered into trade or consumption there; and
(d) good has not undergone any operation there other than unloading, reloading, repackaging, labeling, splitting of consignments, or any operation required to keep them in good condition.
3. An importer shall upon request supply appropriate evidence to the customs authorities of the importing Party that the conditions set out in paragraph 2 have been fulfilled. The evidence may be given by:
(a) contractual transport documents such as bills of lading; or
(b) factual or concrete evidence based on marking or numbering of packages; or
(c) a certificate of non-manipulation provided by the customs authorities of the country(ies) of transit or splitting or any other documents demonstrating that the goods remained under customs supervision in the country(ies) of transit or splitting; or
(d) any evidence related to the goods themselves.
Article 3.15. Free Economic Zones or Free Zones
1. Both Parties shall take all necessary steps to ensure that originating goods traded under cover of a proof of origin which in the course of transport use a free zone situated in their territory, are not substituted by other goods and do not undergo handling other than normal operations designed to prevent their deterioration.
2. Goods produced or manufactured in a free zone situated within a Party, shall be considered as originating goods in that Party when exported to the other Party provided that the treatment or processing is in conformity with the provisions of this chapter and supported by a Proof of Origin.
3. When products originating in UAE or in Mauritius are imported into a free zone under cover of a Proof of Origin and undergo treatment or processing, the authorities concerned shall issue a new certificate of origin at the exporter?s request, if the treatment or processing undergone complies with the provisions of this Chapter.
Article 3.16. Exhibitions
1. Originating goods of a Party sent for exhibition in a non-Party and sold after the exhibition for importation to the other Party shall benefit on importation from the provisions of this Agreement, provided it is shown to the satisfaction of the customs authorities that:
(a) an exporter has consigned these goods from the exporting Party to the country in which the exhibition is held and has exhibited them there;
(b) the goods have been sold or otherwise disposed of by that exporter to a person in the other Party;
(c) the goods have been consigned during the exhibition or immediately thereafter in the state in which they were sent for exhibition; and
(d) the goods have not, since they were consigned for exhibition, been used for any purpose other than demonstration at the exhibition.
2. A Proof of Origin must be issued or made out in accordance with the provisions of Article 3.18 and submitted to the customs authorities of the importing Party. The name and address of the exhibition must be indicated thereon. When requested, additional documentary evidence of the conditions under which they have been exhibited shall be provided, including proof that the exhibited goods remained under customs control, if required.
3. Paragraph 1 shall apply to trade, industrial, agricultural, or crafts exhibition, fair, or similar public show or display which is not organized in shops or business premises for direct sale to the public of the exhibited products and during which the products remain under customs control.
Article 3.17. Third Party Invoicing
1. The customs authority in the importing Party shall not reject a certificate of origin only for the reason that the invoice was issued by a non-Party trader, provided that the good meets the requirements in this Chapter.
2. The exporter of the goods shall indicate ?third party invoicing? and such information as name, address of the company issuing the invoice, invoice number and date shall be reproduced from the commercial invoice issued by the non-Party trader in the appropriate field as detailed in Annex 3B.
3. The Origin Declaration established in Article 3.21 shall not be provided on an invoice issued by a third Party; instead the Origin Declaration can appear on any other commercial document related to the originating goods made out in the territory of the exporting Party.
Section C. Origin Certification
Article 3.18. Proof of Origin
1. Goods originating in a Party shall, on importation into the other Party, benefit from preferential tariff treatment under this Agreement on the basis of a Proof of Origin.
2. Any one of the following shall be considered as a Proof of Origin of an originating good:
(a) a paper format certificate of origin issued by a competent authority as per Article 3.19;
(b) an Electronic Certificate of Origin (E-Certificate) issued by a competent authority and exchanged by an electronic system as per Article 3.20;
(c) an origin declaration made out by an approved exporter as per Article 3.21.
3. Each Party shall provide that a Proof of Origin shall be completed in the English language and shall remain valid for one year from the date on which it is issued or made out and be submitted within its validity period.
4. Notwithstanding paragraphs 1 and 2, the importing Party shall not require a Proof of Origin if the said Party has waived the requirement or does not require the importer to present a Proof of Origin as per its domestic laws.
5. Proof of Origin shall be submitted to the customs authority of the importing country in accordance with the procedures applicable in that Party.
6. In exceptional circumstances, the Proof of Origin may be accepted by the customs authority in importing Party for the purpose of granting preferential tariff treatment even after the expiry of its validity provided the failure to observe the time limit results from force majeure or other valid reasons beyond the control of the exporter and the goods have been imported before the expiry of the validity period of the said Proof of Origin.
7. The Proof of Origin shall be issued by the competent authority of the exporting Party or shall be made out by the approved exporter prior to or at the time of shipment