What is a 'Certificate Of Origin - CO'

A certificate of origin (CO) is a document declaring in which country a commodity or good was manufactured. The certificate of origin contains information regarding the product, its destination, and the country of export. Required by many treaty agreements for cross-border trade, the CO is an important form because it can help determine whether certain goods are eligible for import, or whether goods are subject to duties.

BREAKING DOWN 'Certificate Of Origin - CO'

There is no standardized certificate of origin (CO) form for global trade, but a CO, normally prepared by the exporter of goods, has at least the basic details about the product being shipped, a tariff code, the exporter and importer, and the country of origin. The exporter, with knowledge of the specific requirements of border control at the importing country, will document these details, get the CO notarized by a chamber of commerce, and submit the form with the shipment. Detail requirements depend on the type of goods being exported and where they are going.

Two Types of Certificate of Origin

The two types of COs are non-preferential and preferential. Non-preferential COs, also known as "ordinary COs," indicate that the goods do not qualify for reduced tariffs or tariff-free treatment under trade arrangements between countries, while preferential COs declare that they do. In the U.S. the Generalized System of Preferences (GSP), enacted by Congress in 1974 to promote economic development of poor nations, eliminates duties on thousands of products imported from over one hundred countries accorded preferential status. Countries like Bolivia, Cambodia, Haiti, Namibia and Pakistan are presently on the list, as are numerous other third-world or developing countries. The European Union and countries around the world have their own versions of a GSP, mainly geared to fostering economic growth through trade with friendly nations.

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