In this text, we want to draw your attention to the document you need to apply the agreement to goods you import from China or export to China.
Rules of Origin
The rules of origin are defined in Chapter 3, Articles 22-47, as well as in Annexes 2, 3 and 4 of the Free Trade Agreement between the Government of the Republic of Serbia and the People's Republic of China. The key element of the Agreement are the rules of origin, which determine which goods can benefit from preferential customs treatment. For a product to be considered as originating from Serbia or China, it must meet strictly defined conditions. The rules are established to prevent abuse of the agreement and ensure that only goods truly originating from these two countries receive benefits.There are three basic ways goods can satisfy the rules of origin:
Wholly obtained or produced goods - refers to products entirely obtained in the territory of one of the countries (e.g. minerals, agricultural products).
Sufficient processing - goods produced from non-originating materials can obtain originating status, provided they undergo substantial processing in Serbia or China where the regional value content in the final product is at least 40%.
Bilateral cumulation - materials originating from Serbia used in production in China (and vice versa) are considered part of the final product, making it easier to meet the conditions.
In addition, the Agreement contains special provisions for certain products (listed in Annex 2), as well as rules on direct transport and territoriality, which ensure that goods do not undergo additional processing in third countries.
The image below shows what a certificate of origin looks like in practice. The certified document below confirms that the goods originate from China. Sensitive information has been obscured.
Verification of proof of origin is conducted through cooperation between the customs administrations of both countries, and preferential treatment may be denied in case of irregularities.
What are the key benefits of the Serbia-China Free Trade Agreement that came into force on July 1, 2024?
The agreement eliminates or reduces tariffs for Serbian exporters and importers from China, simplifies customs procedures and grants preferential treatment to goods that meet the rules of origin. Agriculture and industry benefit the most.
How do the rules of origin work under this agreement?
Goods can receive preferential treatment if they meet one of three conditions:
- Wholly obtained/produced (e.g. minerals, agricultural products from Serbia/China - Article 24).
- Produced from non-originating materials (if it has ≥40% regional value content - Article 25).
- Bilateral cumulation (materials from Serbia/China are considered as originating in the country of final production - Article 28).
Exception: Annex 2 lists products (e.g. rubber, cotton) with special rules (change in tariff classification).
How is the 40% regional value content (RVC) calculated?
RVC = (Product Value - Non-originating Materials) / Product Value × 100%Non-originating materials include imports from third countries or materials of unknown origin (customs value at import).
De minimis rule: Up to 10% of non-originating materials is allowed if they don't meet the tariff classification change requirements (Article 26).
What are the special cases for determining origin?
- Accessories, spare parts and tools invoiced with goods are considered part of the goods.
- Retail packaging doesn't affect origin but is included in RVC.
- Neutral elements (fuel, protective equipment) are not included in calculations.
- Sets qualify if non-originating components constitute ≤15% of total value (Article 33).
Who, when and how issues the Certificate of Origin?
- Certificate of Origin is issued by the authorized body of the exporting Party.
- Certificate of Origin is issued before or at the time of export.
- The exporter, producer or their authorized representative, in accordance with domestic legislation, submit a written request for a Certificate of Origin along with supporting documentation proving that the exported products meet the conditions for issuing the Certificate of Origin.
- The Certificate of Origin, for which a sample is given in Annex 3 (Certificate of Origin) of this Agreement, is completed in English and duly authenticated by signature and seal. The Certificate of Origin is valid for only one year from the date of issue.
- In exceptional cases where the Certificate of Origin was not issued before or at the time of export, the Certificate of Origin may be issued retroactively, within one year from the date of shipment, with the note "ISSUED RETROACTIVELY", and with a validity period of one year from the date of shipment.
What do the principles of territoriality and direct transport require?
- Territoriality (Article 34): Production must be entirely in Serbia/China (without processing in third countries).
- Direct transport (Article 35): Goods must be transported directly between the countries. Transit through third countries is allowed if:
- There is no commercial use.
- The goods remain under customs supervision.
- Only unloading/reloading is permitted.
How is origin verified?
- Proof of origin (e.g. certificates) must be kept for 3 years.
- Customs cooperation (Articles 43-44): Serbia and China exchange seal samples, certificate forms and conduct verifications.
- Verification process: The importer may suspend preferential treatment during verification (deadline: 6 months).
When can preferential treatment be denied?
(Article 45)
- If goods don't meet the rules of origin.
- If territoriality/transport conditions are violated.
- If there's no response to a verification request within 6 months.
These are the basic guidelines related to this topic. For detailed information, please read the law at the link below.
Source: Law on Ratification of the Free Trade Agreement between the Government of the Republic of Serbia and the People's Republic of China