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On 25 August 2021 the EU Commission published guidance on the transitional rules of origin in the pan-Euro-Mediterranean area (the “Transitional Rules“). The EU is currently amending 21 origin protocols within the pan-Euro-Mediterranean (“PEM“) area by implementing an alternative set of rules of origin which will apply alongside the rules of the Regional Convention on pan-Euro-Mediterranean preferential rules of origin (the “PEM Convention“). The amendments will apply on a bilateral basis pending the adoption of the revised Convention. The new rules, which seek to improve and simplify the current PEM Convention, were endorsed by a large majority of PEM Contracting Parties who wished to benefit from the changes in advance of the revised Convention.

The transitional rules should initially apply from 1 September 2021 between the EU and Switzerland, Norway, Iceland, Albania, Jordan and Faeroe Islands. The adoption of the amendments to the bilateral origin protocols on rules of origin with other countries (North Macedonia, Serbia, Montenegro, Bosnia and Herzegovina, Kosovo, Republic of Moldova, Georgia, Ukraine, Palestine, Lebanon, Turkey and Egypt) is ongoing.

The guidance on the Transitional Rules is addressed to the business community, customs authorities and other interested parties and clarifies how the two sets of rules of origin will coexist. Exporters will be able to choose between either the current rules of the PEM Convention or the Transitional Rules with the PEM Contracting Parties that apply them. The guidance addresses the practicalities of complying with the Transitional Rules as well as the main changes that are to be brought in, such as those in relation to sufficiently worked or processed products. The guidance also discusses changes to product specific rules for agricultural products, industrial products and textiles.

Author

Jennifer Revis is a partner in the EU Competition and Trade Practice Group of Baker McKenzie's London office. She is acknowledged for her timely advice and responsiveness by the Legal 500. Jennifer has been on secondment to the UK customs authorities (Her Majesty's Revenue and Customs) in their tax and excise litigation department and to the Firm's European Law Centre in Brussels. Jennifer is frequently invited to speak at external conferences and regularly contributes articles to tax journals on customs matters such as De Voils Indirect Tax Journal.

Author

Olivia Strafford is a Trainee Solicitor in Baker McKenzie London office.

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