It is generally accepted that the code of the country of origin of goods is indicated in the first digits of its bar marking. This is only partially true. Improving production technologies, reducing transport costs, and globalization processes lead to the movement of production or its individual links to foreign regions, which undoubtedly complicates the identification of the country of origin. So, how is the country of origin of the goods determined? Let's try to figure it out.
If the production technology of the product is limited to one phase or the entire technological chain is produced within one country, determining the country of origin of the goods does not cause difficulties. This category includes agricultural products and goods that do not contain imported components.
If the production of goods involves components produced in two or more countries, the term sufficient or substantial processing is used. A sufficient processing is considered to be the process that endows the product with its main property.
In some cases, the country of origin may be called the customs union, a group of countries, as well as part of the country or its separate region.
According to the International Customs Convention, the country of origin of the goods can be determined by one of three methods.
The first method is changing the code. A product will be considered to be produced in a given country if its classification code is different from the codes of imported materials used in its production (two hundred countries of the world support a unified harmonized system of classification of goods).
The second method is determining the ad valorem share. If a significant part in the price of the final product (a fixed percentage) is made up of materials or the value added in a particular country, this is the country of origin of the goods.
The third method - some production operations. There is a regulated list of technological operations; if they are implemented in a given country, it will be considered the birthplace of the goods produced (the so-called "positive criterion"). Conversely, a number of technological operations do not allow us to consider the country as the homeland of goods (negative criterion). This method also applies to materials. For example, only raw yarn is used as raw material for clothing production in the EU countries . Clothing made from cloth cannot be considered made in the EU.
The first digits in the barcode identify the GS1 national organization. The manufacturer has the right to join the national organization of another state and indicate its code when marking its goods. For example, if an Italian furniture manufacturing company exports it to Russia, Germany and sells it on the domestic market, it is a GS1 member of Russia, Germany and Italy and, accordingly, labels its products with three different prefixes.
The country of origin of goods is of great importance when conducting foreign trade operations for regulating tariffs, determining the amount of customs duties, as well as fulfilling the requirements applicable to the labeling of goods.