The first task for exporters is to identify the tariff classification and consult Annexure A for the applicable product-specific rule. Goods may qualify as originating because they are wholly obtained, produced entirely from originating materials, or sufficiently produced using non-originating materials. The product-specific rule may require a change in tariff classification at the chapter, heading or subheading level, a prescribed Qualifying Value Content (QVC), a specified production process, or a combination of these tests.
QVC measures the originating content in the finished product. It may be calculated through the build-down method, which deducts non-originating materials from the value of the product, or the build-up method, which directly measures originating materials. Where Annexure A prescribes Standard QVC, build-down requires at least 40 per cent of the ex-works price or 45 per cent of the FOB value; build-up requires 35 per cent of either value. The calculation must be supported by costing and input records.
The Rules provide flexibility. Under bilateral cumulation, UK-originating materials used in India may be treated as Indian-originating, and vice versa. Some product-specific rules provide alternative, equally valid tests. Tolerance may permit limited use of non-originating materials that would otherwise prevent satisfaction of a tariff-change or wholly obtained requirement. However, non-qualifying operations — such as simple packing, sorting, painting or assembly, affixing labels, and dilution that does not materially alter the goods — cannot, by themselves, confer originating status.
For Indian exports to the UK, preference may be claimed through an origin declaration completed by the exporter or
producer, a certificate issued by a designated Indian authority, or the UK importer’s knowledge. Indian exporters may self-certify through the prescribed origin declaration, generated after one-time registration on DGFT’s Common Digital Platform.
Exporters and producers should preserve bills of materials, supplier declarations, invoices, production and costing records, tariff classifications and transport documents for five years. Goods routed through a third country must remain under customs control
and undergo only permitted operations. Self-certification reduces paperwork, but shifts greater responsibility for accuracy to exporters, producers and importers.
For UK exports to India, a claim for preferential treatment must be supported by an origin declaration completed by the exporter or producer. After registering with HMRC, the exporter or producer must complete the prescribed declaration and send it to the Indian importer, copying Indian Customs for authentication. The declaration is valid for 12 months from completion.
Before claiming preference, Indian importers should identify the applicable product-specific rule, obtain confirmation of the origin criterion declared by the exporter and secure sufficient non-confidential origin-related information from the exporter to demonstrate compliance. They must also fulfil their obligations under the Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020, commonly called CAROTAR. Contracts should allocate liability for duty, interest and penalties if an origin claim fails.
Importers and exporters should therefore align sourcing, production, classification and records before the first preferential consignment. An origin review before shipments begin can prevent disputes, delays, denial of preference and duty exposure.
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