The Customs (Origin of Chargeable Goods: Developing Countries Trading Scheme) Regulations 2023

Intra-regional cumulation: countries in the same regional group

18.—(1) An exporter may regard the goods in paragraph (2) as goods originating from a qualifying DCTS country (in this regulation, “the cumulating DCTS country”) if the conditions set out in paragraph (3) are met.

(2) The goods mentioned in paragraph (1) are—

(a) qualifying DCTS goods which under regulation 4 are to be regarded as originating from another qualifying DCTS country in the same regional group as the cumulating DCTS country;

(b) goods originating from an FTA partner in the same regional group as the cumulating DCTS country, in accordance with a trade arrangement between the FTA partner and the United Kingdom implemented under section 9 of the Act (preferential rates: arrangements with countries or territories outside the UK).

(3) The conditions mentioned in paragraph (1) are that—

(a) the goods are further processed in the cumulating DCTS country,

(b) the goods are not excluded under paragraph (4),

(c) the goods, when originating from an FTA partner country under paragraph (2)(b), would on the declaration acceptance date qualify for a nil rate of import duty were they imported into the UK directly from the FTA partner,

(d) the cumulating DCTS country complies with the conditions relating to customs cooperation and verification of proof of origin provided for by regulation 16 of the DCTS Regulations,

(e) the processing carried out in the cumulating DCTS country where the goods are further processed goes beyond the processing described in regulation 8(2) (processing that does not constitute an important stage of manufacture), and

(f) in the case of textile goods, in addition to meeting the condition set out in sub-paragraph (e), the processing carried out in the qualifying DCTS country where the goods are further processed goes beyond one or more of the following—

(i) fitting of buttons or other types of fastenings;

(ii) making of button-holes;

(iii) finishing off the ends of trouser legs and sleeves or the bottom hemming of skirts and dresses and other apparel;

(iv) hemming of handkerchiefs, table linen and other textile articles;

(v) fitting of trimmings and accessories including pockets, labels and badges;

(vi) ironing and other preparations of garments for sale ready-made.

(4) The goods or materials listed in the second column of the table in Schedule 2 are to be excluded from intra-regional cumulation within a regional group marked “X” in the corresponding entry in the third or fourth column, or, as the case may be, in each of those columns, of that table if—

(a) the DCTS rate applicable to those goods or materials in the United Kingdom under Part 4 of the DCTS Regulations is not the same for all the countries or territories concerned, and

(b) the goods or materials concerned would benefit, through intra-regional cumulation, from a tariff treatment more favourable than the one from which they would benefit if directly exported to the United Kingdom.

(5) Where the condition set out in paragraph (3)(e) is not met or, in the case of textile goods, where the conditions set out in paragraph (3)(e) and (f) are not met, the final goods are to be regarded as originating from the qualifying DCTS country involved in the intra-regional cumulation from which the largest share of the value of the materials used in the manufacture of the final goods originates.

(6) For the purposes of paragraph (5), the final good must still meet the conditions specified in regulation 4 to be regarded as originating from that qualifying DCTS country.

(7) In this regulation—

“intra-regional cumulation” refers to the treatment of goods originating from a qualifying DCTS country or an FTA partner country in the same regional group as another qualifying DCTS country (“C”) as goods originating from C in the circumstances described in this regulation;

“DCTS rate” has the meaning given in regulation 2(1) of the DCTS Regulations.