Certificate of Origin: Types, FTA Rules & LC Checks
Preferential vs non-preferential certificates of origin, who issues them, FTA origin rules and how banks examine them under UCP 600 and ISBP 821.
Quick Answer: Certificate of Origin
Non-preferential certificates
These show origin under general rules, often the last substantial transformation. Chambers of commerce issue them, many now digitally. Buyers ask for them for customs, trade remedies or because the letter of credit requires one.
Preferential origin and FTAs
A preferential proof lets the buyer claim reduced FTA duty. Depending on the agreement it can be an official certificate (for example Form A or an AIFTA form), an origin declaration on the invoice, or registered-exporter (REX) self-certification in EU schemes. The goods must meet the agreement's rule: wholly obtained, a change in tariff classification, a value-added threshold or a specific process.
How banks check it under an LC
Under UCP 600 Article 14(f) the certificate must appear to fulfil its function and its data must not conflict with other documents. ISBP 821 paragraphs L1 to L8 add that it must be signed, issued by the entity the credit names (or any entity if none is named), and show the goods' origin. It may name a different consignee or exporter than other documents, within the ISBP limits.
At a glance
| Type | Issued by | Purpose |
|---|---|---|
| Non-preferential certificate | Chamber of commerce | Proves origin for customs, quotas, trade remedies |
| Preferential certificate | Authority named in the FTA | Claims reduced FTA duty |
| Origin declaration on invoice | Exporter (approved or registered) | Claims FTA duty without a separate certificate |
| REX statement | Registered exporter | EU GSP and some EU FTAs |
Worked example
An Indian exporter ships cotton shirts to Australia under the India-Australia ECTA. The shirts qualify under the agreement's product rule, so the exporter obtains a preferential certificate of origin. The Australian buyer claims the preferential rate instead of the general rate. If the credit asks for a certificate 'issued by a chamber of commerce', a certificate from any other body would be discrepant.
Frequently asked questions
Who issues a certificate of origin?
Chambers of commerce usually issue non-preferential certificates. Preferential proofs are issued by the authority named in the trade agreement, or made out by an approved or registered exporter.
Is a certificate of origin required for every shipment?
No. It is needed when the buyer's customs, the contract, a letter of credit or an FTA claim asks for it.
Can a certificate of origin show a different consignee under an LC?
Yes, within limits. ISBP 821 allows some data, such as the consignee, to differ from other documents as long as it does not conflict with the credit.
Frequently asked questions
Who issues a certificate of origin?#
Chambers of commerce usually issue non-preferential certificates. Preferential proofs are issued by the authority named in the trade agreement, or made out by an approved or registered exporter.
Is a certificate of origin required for every shipment?#
No. It is needed when the buyer's customs, the contract, a letter of credit or an FTA claim asks for it.
Can a certificate of origin show a different consignee under an LC?#
Yes, within limits. ISBP 821 allows some data, such as the consignee, to differ from other documents as long as it does not conflict with the credit.