Certificate of Origin Circulars

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Dear Sirs,

Certificate of Origin Circular No. 05/2005

Certificate of Hong Kong Origin (CO) Consignment Check Requirements

INTRODUCTION

Further to the Certificate of Origin Circular No. 14/2004, this circular reminds exporters/manufacturers/subcontractors and any other concerned parties of the need to comply with consignment check requirements in respect of Certificates of Hong Kong Origin (CO).

CERTIFICATE OF ORIGIN REQUIREMENT

2. To substantiate a proof of Hong Kong origin for exports, it will be in traders' interest to take out a Certificate of Hong Kong Origin (CO) if the goods concerned are indeed products of Hong Kong. Although overseas may not generally require a CO to accompany every import consignment, it is advisable that traders readily produce a CO to the importing end authorities (if so required) to evidence the origin of the goods. In applying for a CO, traders are reminded that goods claiming Hong Kong origin under a CO must have undergone the principal processes of manufacture in Hong Kong. They are processes which permanently and substantially change the nature, shape, form or utility of the basic materials used in manufacture as laid down by the Director-General of Trade and Industry in relevant Certificate of Origin Circular(s) from time to time. The latest Certificate of Origin Circular is at: http://www.tid.gov.hk/english/aboutus/tradecircular/coc/2004/coc172004.html.
   
   
3. Notwithstanding the above, traders are reminded to find out from their overseas buyers and the importing end authorities any other specific requirements they need to observe before exportation of their goods from Hong Kong, including but not limited to the origin classification and origin labelling requirements, etc.
   

Compliance with Consignment Check Requirements

4. In order to uphold the integrity of the origin certification system, the Trade and Industry Department, in conjunction with the Customs and Excise Department, conducts consignment check to verify the accuracy of material particulars declared on an application for a Certificate of Hong Kong Origin. Particulars declared in the subcontractor's declaration will also be checked. Officers of the Customs and Excise Department are empowered by law to enter the premises of the exporter/manufacturer/subcontractor and any other parties involved in the manufacture and/or export of consignment, and to conduct inspections at any reasonable time. Cargo examination by officers of Customs and Excise Department may also take place at the container terminal, the airport, and other points of exit during customs clearance. Where necessary, sealed packages or containers are opened for inspection. During the course of checking, the responsible person (including the proprietor / one of the partners/ one of the directors) and the subcontractors must render all necessary assistance and co-operation to officers of the Customs and Excise Department in conducting the checks, including the production of relevant commercial and shipping documentation and manufacturing/production records as appropriate. Suspected malpractice is subject to full investigation.
   
   

5. CO applicants are reminded that if a particular application is selected for pre-issue check by the Trade and Industry Department, it will normally take a relatively longer time to process that application. Traders are therefore requested to bear this in mind in drawing up their shipment schedules. Unless and until the pre-issue check (including the checking of supporting documents and physical inspection of goods) has been completed, the applications concerned will not be processed for approval.

6. With immediate effect, the responsible person of all the parties concerned are required to comply with the following requirements in particular :

1. For a CO application, the manufacturer must make the finished goods available for inspection by officers of the Customs and Excise Department in the address of exporter/manufacturer/subcontractor as described in the manufacturer's declaration two clear working days before exportation to the destined market.

2. Manufacturers who need to subcontract outside Hong Kong the subsidiary processes of the goods covered by the CO under the Outward Processing Arrangement (OPA) must ensure that the goods have been completed and returned to Hong Kong and ready for inspection by officers of the Customs and Excise Department in accordance with the requirement as set out in (a) above.

3. If the goods covered by the CO could not be sighted by the officers of the Customs and Excise Department, the said CO might not be issued by the Trade and Industry Department or one of the five Government Approved Certification Organizations (GACOs)^(Note)

4. Exporters/manufacturers/subcontractors and other concerned parties of a CO application are reminded that, for CO application being selected for pre-issue consignment check, unless the check was conducted by officers of the Customs and Excise Department and to their satisfaction that the consignment was in order, the CO would not be issued by Trade and Industry Department or GACOs.

5. Applicants of the CO are also reminded that the port of loading of the goods concerned must be Hong Kong. Applicants filling in any "Port of Loading" other than Hong Kong in a CO application will not be accepted.

WARNING

7. The Trade and Industry Department works closely with the Customs and Excise Department, through checks and inspections, to ensure compliance with the provisions of the origin certification system. Breach of any of the provisions of the origin certification system or failure to comply with other requirements specified by the Director-General of Trade and Industry, including those requirements promulgated by the Trade and Industry Department through notices and circulars from time to time, may result in prosecution under the Import and Export Ordinance or the Protection of Non-Government Certificates of Origin Ordinance as appropriate, which provides for a penalty of a fine of HK$500,000 and 2 years' imprisonment. In addition, the Trade and Industry Department may take administrative actions against the exporters and manufacturers (including subcontractors as the case may be) concerned irrespective of whether they have been prosecuted.

ENQUIRIES

8. Should you require further information on the content of this circular, please contact the undersigned at 2398 5652.
   

Yours faithfully,


(Thomas LI)

for Director-General of Trade and Industry

Note : The five Government Approved Certification Organizations (GACOs) are Hong Kong General Chamber of Commerce, Federation of Hong Kong Industries, the Chinese Manufacturers' Association of Hong Kong, the Indian Chamber of Commerce, Hong Kong and the Chinese General Chamber of Commerce.