AsemconnectVietnam - The Ministry of Industry and Trade (MOIT) has issued Circular No. 11/2024/TT-BCT providing detailed regulations on the rules of origin for goods within the framework of the Vietnam-Israel Free Trade Agreement (VIFTA).

This Circular serves as a crucial legal basis for implementing tariff preferences and facilitating bilateral trade between Vietnam and Israel.
Specifically, Circular No. 11/2024/TT-BCT outlines the criteria for determining whether goods originate from Vietnam or Israel. These criteria include:
Wholly obtained goods: products entirely grown, produced, or manufactured in one of the member countries.
Goods produced from originating materials: products manufactured using only materials that already originate from a VIFTA member country.
Goods with non-originating materials but sufficient processing: products that utilize non-originating materials but have undergone sufficient processing or manufacturing operations according to specific product-specific rules (e.g., regional value content (RVC), change in tariff heading (CTC), or specific manufacturing processes).
The key features of the VIFTA rules of origin
The Circular introduces several notable provisions designed to offer flexibility and support trade:
"De Minimis" mechanism: This mechanism allows for flexibility in determining origin, permitting a maximum threshold of 10% of the ex-works value or weight of the goods for non-originating materials. This means a small percentage of non-originating content won't necessarily disqualify a product from preferential treatment.
"Cumulation of Origin" principle: This principle allows materials originating from one member country to be considered as originating from the other member country. For example, if a Vietnamese product uses materials from Israel, those materials can be counted as originating from Vietnam for the purpose of determining the final product's origin.
To ensure transparency and convenience, the Circular clearly specifies the types of proof of origin documents:
Certificate of Origin (C/O) Form VIFTA: The primary document used to certify the origin of goods.
Self-certification by qualified exporters: eligible exporters can issue their own self-declarations of origin.
Exporter's declaration for low-value shipments: for consignments valued under 1,000 USD, a simplified exporter's declaration can be used.
The Circular also details the procedures for issuing, re-issuing, and verifying C/Os, aiming to ensure validity and prevent trade fraud.
Furthermore, the Circular addresses other important aspects:
Direct consignment: rules regarding the direct shipment of goods between the two countries.
Exhibition goods: provisions for goods displayed at exhibitions.
Waiver of C/O for low-value non-commercial goods: exemption from submitting a C/O for low-value non-commercial shipments.
Handling minor discrepancies in documents: guidelines for addressing minor errors or discrepancies in documentation.
Verification of origin will be conducted based on risk assessment and through cooperation between the competent authorities of both Vietnam and Israel.
This Circular is effective from its signing date and provides a crucial framework for Vietnamese businesses to effectively leverage the tariff preferences offered by the Israeli market, thereby promoting exports of high value-added goods, enhancing competitiveness, and fostering international integration.
CK
Source: VITIC