Trade policies; Origin quotas
Origin quotas are sometimes called derogations.
They allow specific quantities of some goods to get preferential tariff treatment.
The goods must meet certain conditions. For example, a trader must prove the origin of the goods. Read about rules of origin on GOV.UK.
The following table shows an example of a rule of origin in the EU-South Korea trade agreement.
| HS heading | Description of product | Working or processing, carried out on non-originating materials, which confers originating status |
|---|---|---|
| 2402 | Cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco substitutes | Manufacture in which at least 70% by weight of the unmanufactured tobacco or tobacco refuse of heading 2401 used is originating |
The following table shows there is also an origin quota in the EU-South Korea trade agreement.
| HS heading | Description of product | Working or processing, carried out on non-originating materials, which confers originating status | Annual quota for exports from Korea into the EU |
|---|---|---|---|
| 2402 20 | Cigarettes containing tobacco | Manufacture from materials of any heading, except that of the product | Annual quota of 250 Metric tons |
graph g {
rankdir=LR
node [shape=box]
Quota -- QuotaDefinition
Measure1 -- Quota
Measure2 -- Quota
Measure1 -- GeographicalArea
Measure2 -- GeographicalArea
Quota -- GeographicalArea
Measure1 -- Commodity1
Measure2 -- Commodity2
Measure1 -- Certificate
Measure2 -- Certificate
Certificate [label=<Certificate<BR/><FONT POINT-SIZE="12.0">Type: U (Proof of origin)</FONT>>]
Measure1 [label=<Measure<BR/><FONT POINT-SIZE="12.0">Type: Pref. quota</FONT>>]
Measure2 [label=<Measure<BR/><FONT POINT-SIZE="12.0">Type: Pref. quota</FONT>>]
Commodity1 [label="Commodity"]
Commodity2 [label="Commodity"]
{rank=min; Quota; GeographicalArea; Certificate;}
}An origin quota consists of a quota associated with some commodities via measures. The quota is a first come, first serve quota. As usual, it requires a quota order number beginning 05.
The measures associated with the quota each have a measure condition that requires the use of a certificate.
The certificate should be of type U (proof of origin). It must describe the specific part of the trade agreement that mentions the origin quota.
The condition code for the measure condition is type Q (import due to a special licence). The following table shows how measure conditions are set up.
Q: Presentation of an endorsed certificate/licence
| Document code | Requirement | Action |
|---|---|---|
| Uxxx | Proof of origin containing the following statement in English: "Product originating in accordance with Section x of Annex xxx" | Apply the mentioned duty |
| No document provided | Measure not applicable |
In the trade agreement with the EU, an origin quota is made available for tuna loins:
| Harmonised system classification (2017) | Product description | Alternative product-specific rule | Annual quota for exports from the Union to the United Kingdom (net weight) | Annual quota for exports from the United Kingdom to the Union (net weight) |
|---|---|---|---|---|
| 1604.14 | Prepared or preserved tunas, skipjack and bonito (Sarda spp.), whole or in pieces (excl. minced) | CC | 3,000 tonnes | 3,000 tonnes |
| 1604.20 | Other prepared or preserved fish | |||
| Of tuna, skipjack or other fish of the genus Euthynnus (excl. whole or in pieces) | CC | 4,000 tonnes | 4,000 tonnes | |
| Of other fish | - | - | - |
1604.14 (or commodity code 1604 14 00 00) specifies an annual volume of 3,000 tonnes.
1604.20 does not have a quota specified against the code itself, and nothing is specified against its subdivision “of other fish”. So, the quota only applies to the one child 'of the Euthynnus genus'. This corresponds to commodity code 1604 20 70 00 in the current nomenclature.
Two different quota order numbers are needed because:
- the 2 quotas are independent - trades from one do not remove volume from the other
- the 2 quotas have different volumes
As the origin quotas are defined in the same table they can use a certificate with the same description. This results in the following tariff data objects:
graph "EU Tuna Origin quota anatomy" {
rankdir=LR
node [shape=box]
Quota1 -- QuotaDefinition1
Quota2 -- QuotaDefinition2
Measure1 -- Quota1
Measure2 -- Quota2
Measure1 -- GeographicalArea
Measure2 -- GeographicalArea
Quota1 -- GeographicalArea
Quota2 -- GeographicalArea
Measure1 -- Commodity1
Measure2 -- Commodity2
Measure1 -- Certificate
Measure2 -- Certificate
Quota1 [href= "https://www.trade-tariff.service.gov.uk/quota_search?order_number=059161", label=<Quota<BR/><FONT POINT-SIZE="12.0"><U>059161</U></FONT>>]
Quota2 [href="https://www.trade-tariff.service.gov.uk/quota_search?order_number=059162", label=<Quota<BR/><FONT POINT-SIZE="12.0"><U>059162</U></FONT>>]
Certificate [href= "https://www.trade-tariff.service.gov.uk/certificate_search?type=U&code=178", label=<Certificate<BR/><FONT POINT-SIZE="12.0"><U>U178</U><BR/>Proof of origin containing the following statement in English:<BR/>"Product originating in accordance with Section 1 of Annex II-A"</FONT>>]
Measure1 [label=<Measure<BR/><FONT POINT-SIZE="12.0">Type: Pref. quota (143)</FONT>>]
Measure2 [label=<Measure<BR/><FONT POINT-SIZE="12.0">Type: Pref. quota (143)</FONT>>]
Commodity1 [href= "https://www.trade-tariff.service.gov.uk/commodities/1604142610#import", label=<Commodity<BR/><FONT POINT-SIZE="12.0"><U>`1604 14 00 00`</U></FONT>>]
Commodity2 [href="https://www.trade-tariff.service.gov.uk/commodities/1604207030#import", label=<Commodity<BR/><FONT POINT-SIZE="12.0"><U>`1604 20 70 00`</U></FONT>>]
QuotaDefinition1 [label=<Quota definition<BR/><FONT POINT-SIZE="12.0">Volume: 3000 TNE<BR/>Dates: 1st Jan 2021 – 31st Dec 2021</FONT>>]
QuotaDefinition2 [label=<Quota definition<BR/><FONT POINT-SIZE="12.0">Volume: 4000 TNE<BR/>Dates: 1st Jan 2021 – 31st Dec 2021</FONT>>]
GeographicalArea [label=<Geographical area<BR/><FONT POINT-SIZE="12.0">European Union (1013)</FONT>>]
}