rules of origin

Rules of origin are criteria used to determine where a product was made. They are important for trade because they help decide if a product qualifies for preferential tariffs, such as those in free trade agreements. These rules usually look at where the product’s materials come from and where it was processed or assembled. For example, a product might need a certain percentage of its components to come from a specific country or be significantly transformed there. This ensures fair trade practices and proper application of tariffs, helping countries and businesses comply with trade agreements and prevent misuse of preferential tariffs.