The Certificate of Origin goes by a few different abbreviations – C/O, CO and MSO. All of them mean the exact same thing – a shipping document used in international trade that demonstrates the products are obtained or manufactured in a particular country, and in this case, China.
The C/O is a one time document that comes with your products. Each time you order fresh products with Sourcing Nova, a new C/O will come with your products. The document is authentication your products were gotten, manufactured or processed in China.
The C/O is important for any number of agencies as requirements for certain trade agreements. This includes the customs department of the importing country, banks, stakeholders, insurance companies and even importing parties. Customs agencies often require a C/O in the case of duty and tariffs as well as the determination of the legality of products imported.
This blog from Sourcing Nova will be focusing specifically on U.S. imports and C/O. Your specific country may have differing rules on the C/O, but the information is generally the same. You may want to contact the proper authorities in your country to be sure you are compliant.
Certificate of origin and the U.S.
Business owners in the U.S. should certainly be familiar with the C/O process. It is common for some countries, and required by law in the U.S., to require the documentation for certain products and commodities (very common with imported product, seafoods and the like) and to validate country of origin.
There is not a set form for a U.S. importer, and forms can be found online. It is required with Chinese products, so be sure to have one.
The C/O is important as the U.S. has strict rules and regulations on certain products and commodities imported from other countries.
The C/O will need a signature – one from the local Chamber of Commerce in addition to the organization.
How do C/O/MSO function with Chinese products
Firstly, there is no standard C/O.
The C/O is created by the manufacturer with the basic information of the product and origin, in this case, China. There is information necessary, based on understanding of the importing country. The Chamber of Commerce in China will notarize or stamp the document and is included with the product order.
You will submit the C/O to the customs agency of your country, along with the other documents. You will receive a report, and your products will be allowed into your country.
The ICC and C/O
The ICC, International Chamber of Commerce, is an organization that facilitates issuances of Certificates of Origins and attests to the validity of these documents.
The ICC works along side of individual government agencies as each individual government may have its own specific requirements for what goes in the CO.
Specific benefits of a Certificate of Origin
The C/O is more than just a simple document. There are tangible benefits for you as the importer. Here are what you can expect:
- Determines if the products can be imported from Chinese manufacturers
- Speeds up the customs clearance processes
- Make your products stand out from your nearest competition
- Helps with your reporting
- Control management for importing under quota requirementsw
- Helps determine what is and what is not legal to import
- Proper application of duties and tariffs
- Preferential duty programs
- Fulfill requirements for product marketing – must be clear and adequately sized
What information is necessary for a C/O?
There are many details that need to be on a C/O. This includes:
- Our name, Sourcing Nova, address and contact information
- Your name, address and contact information
- Port of export
- Port of import
- Vessel name and voyage number
- Departure date
- Destination country
- Letter of credit – if applicable
- Certificate number
- Product details – description, weight, quantity, HS codes, shipping marks
- State of country of origin
- Any third party details
- Name, date and signature of authorized representative of importer
Getting a C/O/MSO
The certificate process is easy. You do need to follow certain procedures:
- Exportation information form
- Authorized signatories
- Evidence of origin
- Copies of stamped documents
- Signed under the statement of declaration
- Type, check and print – do not write by hand
What countries require a C/O?
Any country that receives products internationally must have a certificate of origin if products were made in a different country.
When is the C/O required?
There are three situations when a C/O is necessary.
- If there is a bilateral Free Trade Agreement, FTA, between the two countries. This provides an opportunity to reduce or dismiss import duties on your products.
- It is necessary during clearance at the customs authority of the country of import. The customs department uses the C/O for tariffs, duties and taxes.
- Customs require the country of origin for products.
Certificate of Title and a Certificate of Origin?
A certificate of title refers to property and not products. After the purchase is made, the C/T refers to legal ownership. This is a local document and only done by overseeing officials, departments or ministries.
How does the C/O facilitate Exporting/Importing
Firstly, understand there is no standardized C/O or global trade. The C/O is created by the manufacturer with basic information about the products and country of origin. Sourcing Nova documents information on border control requirements of the importing countries. Then, we have the chamber of commerce stamp and notarize the form.
When you get your C/O, it goes to the customs department along with the commercial invoice, bill of lading and other documents. Customs will then determine C/O functions and a report. Products enter the country under the report of the customs department. There are requirements you will need to meet before products can completely enter your country.
There are some products that qualify for FTA, Free Trade Agreements. Some products do not require special forms, either. This means FTA partners can take statements with the necessary information outlining why the products are FTA ready.
There are no set forms, although some importers do have a preference. The important information on the FTA form is the claim of preferential treatment. Sourcing Nova will be sure the freight forwarder has the correct documentation.
As a new business owner and getting started, it is highly unlikely you will need a specific form. Instead, just be certain you have the correct information on the form. Typically, you will need the following at a minimum:
- Certifying person’s name along with contact information
- Tariff classification under Harmonized System
- Description of products
- Country of origin
- Date of certification
- Certification period – no more than 365 days
There is no limitation on who can request to see the FTA certificate. In the U.S., it is common for the Customs authorities to make a request.
Is the FTA required
The FTA is optional for most countries. It is common for importers to get products without the FTA preference. If you make a request, Sourcing Nova will include this on the C/O or MSO.
Sourcing Nova will only include FTA products on the C/O. Non-FTA products will not be added, even if we ship the products together to you.
FTA may be used on specific product orders or multiple ones. There needs to be a date range for multiple product orders and no more than one year. C/O or the MSO may have current products only or a list of all products for shipping during the one year period.
Who is responsible for filling out the FTA C/O or MSO
Sourcing Nova dooes not certify for FTA. We leave it for the manufacturer.
Who claims preference
You, the importer, will make the FTA claim when your products enter customs based on the information on the C/O. You will need that information for claims at the customs office of your country.
The FTA is especially important when there are issues requiring interpretation. If there is a need for a ruling, the ruling will be final and affect future shipments of that same product to that same country.
Preferential or Non-Preferential?
There are two types of C/O pr MSO – preferential and non-preferential. They are used to indicate if or if not products meet certain trade agreements with countries.
These are needed if the duties are preferential, reduced or duty-free. Specifically, it a certificate that states products in a shipment come from China and fall under an FTA, free trade agreement. These specific documents are often carefully analyzed and reviewed. For products to qualify as preferential C/O, specifically:
- The products must be manufactured with raw materials or components from China.
- The products must be processed in China.
Sourcing Nova only deals with Chinese products.
Who can issue a preferential C/O?
China will issue the C/O.
There are instances where suppliers, manufacturers, exporters or importers can issue a C/O as well. In this case, the C/O is called a self-issued certificates of origin and declarations of origin. Be aware – these self-issued forms fall under intense scrutiny from the customs of the importing country.
What are the specific rules?
There are set rules the products must meet to be considered as coming from China before sent to an FTA country. Policies from the customs will determine if the products can receive preferential tariffs. These policies are based on the HAS classification and mus tbe product-specific. Any negotiation is separate from the FTA.
There are two rules of origin – wholly obtained and substantial transformation.
- Wholly obtained – Products made in their entirety within the country of the FTA.
- Substantial transformation – Products must undergo a process before consideration as originating from a specific country – China in this case.
- Non-preferential C/O – This is the most common of the two and are sometimes called ‘ordinary C/O.’ The non-preferential is used for the country of origin as well as required duties. If there are policy measures – embargoes, anti-dumping or safety – the non-preferential CO will be employed.
The Non-preferential C/O/MSO is used when importing products across borders. Most of these products will not qualify for tariff free or lowered duties.
Fill in a C/O or MSO
This does not require any advanced skills or preparation. All you will need are the required details like what are outlined above.
The most important elements to remember: the signature, stamps and dates once the details are complete.
Who signs off on the C/O?
Sourcing Nova will sign the C/O. We declare knowledge of the specific details on the form. The chamber of commerce will stamp the form.
Formats of a Certificate of Origin
There are two different C/O or MSO formats
This is non-specific and is used for any products that are not FTA compliant. There is no detailed information – exporter, importer, products and country of origin.
This is a more custom template with specific information concerning the same information as the generic – exporter, importer, products and country of origin.
Electronic C/O or MSO
This is completed online from a website. The electronic form is now standard for exporting products. All of the documents on the application are filled out and submitted to the Chamber of Commerce for stamp or signature of approval.
Why electronic C/O
There are a few good reasons for an electronic C/O.
- Time saver
- Cost reduction
- Faster creation, approval and submission
- Trading safety
- Increased efficiency at customs clearance
- Decreased paperwork
- Enhanced record keeping
What determines country of origin on the C/O
There are two factors that make this determination.
- What parts or ingredients make up your products and their origination
- Where the products are manufactured or assembled
All of your products, from the raw materials to final production or assembly, will com from China.
Why this matters
In addition to the customs requirements of your importing country, the C/O has additional purposes. These include:
- Trade statistics
- Product inner quality
- Settlement of exchange
- Tariff treatment
When is the C/O necessary
The actual C/O or MSO is only necessary under certain circumstances. Such as:
- Customs requirements as part of importation, such as an FTA
- On request from the importer
- Used to determine tariffs and duties
- As part of a quota or requirement for the importing country
- As part of a banking or trade finance requirement
How to apply for a C/O
You can apply for and get your C/O or MSO online. All you need is some basic information:
- Manufacturer details – the invoice is good
- Consignee details
- Transporting details
- Product details
- Duty affidavit
- The payment for the stamping from the manufacturer
New products you may order and have not been previously approved will require a complete check for relevant criteria. Email notifications will come to you in the case of any issues. Once cleared, you can resubmit.
Applications without issue are often approved with an email notification. A PDF of the certificate is often attached to the email.
Is there a fee for the C/O?
If there is a fee, it will be included as a facilitation fee. There is no set cost. Price is determined by the prevailing factors.
Lost, stolen or damaged
It happens. If it happens to you, you need signatory declaration stating the following:
- To your full understanding and belief, the original C/O is lost, stolen or damaged
- Damaged C/Os must be sent with the declaration
- A detailed explanation is also necessary
The NAFTA is a joint agreement between Canada, Mexico and the U.S. The agreement provides for preferential tariff treatment.
During the Trump administration, there was an updated agrement that created a much more reciprocal trade of high paying jobs and growth for the North American economies across all three countries.
Since there is no standard C/O form, any basic form is acceptable. However, the following information is necessary on the form:
- Certificate number – Invalid if blank
- Exporter name – In this case, Sourcing Nova
- Consignee – You, the importer
- Means of transport – sea, air or expedited
- Route – Point of importation, place of transshipment – clearly marked
- From (Local Chinese port) to (Importing country) by (method)
- Certifying authority – Blank, and filled out by the issuing organization
- Marks and numbers – Made out by the invoice only
- Product information – Amount, type and description
- Two hundred (200) cartons of bamboo straws
- H.S. Code – Conforms with customs declaration
- Number and date of invoice
- Declaration of exporting agency
- Certification – signed with a seal
The basic format of the C/O and MSO may change over time, but the manufacturer will provide the necessary information on the application.
The C/O is a very important document for your Chinese products. Sourcing Nova is very familiar with the forms and can help you every step of the way.
How can we help you with importing high quality Chinese products for your new business? Let us know with a comment below.