top of page
Search

UK: Rules of Origin under the UK Vietnam Free Trade Agreement

We provide definitive answers to the 10 most crucial questions for importers/exporters on Rules of Origin, enabling seamless and duty-free trading under the UK-Vietnam FTA.


The UK-Vietnam Free Trade Agreement came into effect in May 2021, providing access to staged reductions in tariffs between the UK and Vietnam. This deal ensures that 65% of all tariffs on UK-Vietnam trade have already been eliminated, and this will increase to 99% after six years. UK exporters of machinery, mechanical appliances, and pharmaceutical products will benefit from the elimination of tariffs. Additionally, the agreement will create new opportunities for Vietnam to increase exports of critical products such as phones and components, garments, footwear, and fish to the UK. Vietnam will continue to receive duty-free tariff quotas for its 14 products, including rice, with improved market access.


Rules of Origin

To be eligible for lower or zero preferential tariffs under the UK-Vietnam Free Trade Agreement, your business, or your partner's must have origins in either the UK or Vietnam. Both exporters/producers and their suppliers can use this page to determine if their product fulfils the rules of origin and can be considered as originating.


General remarks

Please take note that the Developing Countries Trading Scheme ( DCTS ) may also be applicable; therefore it is highly recommended to check. The rules that are specific to a certain product are based on the Harmonized System. If the Most Favored Nation (MFN) duty for your product is zero, then there is no need for you to apply for a preferential tariff or comply with preferential rules of origin. For MFN duties, anti-dumping, anti-subsidies or safeguard measures, origin marking, and non-preferential rules of origin should be applied.


QUESTION 1: Where do I need to look to understand if my product is originating?

Preferential origin is conferred on goods from particular countries which have fulfilled certain criteria allowing preferential rates of duty to be claimed. Suppose your product has been produced using any non-originating materials. In that case, the product has to fulfil the following product-specific rule to be considered originating in the UK or Vietnam (if there are alternative rules, your product needs to comply with only one of them). Each arrangement has its legal base.



QUESTION 2: Do I meet any of the knock-out criteria and don't need to bother any further?

Before you delve into the Product-specific rules, ensure that you are not disqualified from the start.


1. Minimal working or processing

You must also ensure the work or processing you do in the UK goes beyond the minimal operations listed in the agreement and that the other relevant conditions are met. For example, you cannot simply package or label a product from a third country and export it to Vietnam as a good originating in the UK. See the list of minimal operations in Article 6 of the Rules of Origin Protocol in the UK-Vietnam agreement text. Such operations include simple packaging operations, simple assembly, ironing or pressing of textiles, and painting or polishing operations.


2. Principle of territoriality

The principle of territoriality states that any working or processing of a product must be carried out within the territories of the respective parties. Therefore, if you want your product to be categorized as originating, it must be produced solely within the UK or Vietnam, without any processing outside these territories. This is known as the territoriality principle. To qualify for originating status, the production of the product must occur either in the EU or in the territory of the country or countries covered by the preferential trade arrangement. It cannot be partially done outside that territory.


Suppose the originating goods are exported to a country outside the preferential trade area and are used, altered, worked or processed there. In that case, they will be deemed non-originating when they return to the exporting country.


3. Direct transport rule

When transporting goods between the UK and Vietnam, it is important to note that they cannot be processed in a third country. This is to ensure that the products that arrive in the importing country are the same as those that left the exporting country. Direct transport is necessary to comply with preferential arrangements that have rules regarding transporting preferential goods between countries. Direct transport ensures that the goods that arrive in the importing country are the same as those that leave the exporting country. However, if there is a need to pass through or stopover in a third country, the goods must stay under customs supervision to fulfil the conditions of direct transport. Operations such as preserving products in good condition, storage, and splitting of consignments can be conducted in a third country as long as the products are kept under customs supervision. This is known as the non-alteration rule. Proof of compliance with the direct transport rule can be provided through a single transport document or a "non-manipulation certificate" issued by the authorities of the country of transit.


4. Separation

You need to separate originating and non-originating materials during storage physically. However, fungible materials may be stored together using accounting segregation for fungible materials under certain conditions. Fungible materials means materials that are of the same kind and commercial quality, with the same technical and physical characteristics. For example, refined sugar or certain chemicals. By an accounting system, the accounting segregation must ensure that the quantity of products, which can be considered as originating in the UK is the same that what would have been if there had been physical segregation of the materials used. It must be applied in line with the generally accepted accounting principles of a Party.


QUESTION 3: What does the list of Working or Processing Require me to do?

Each arrangement has an annexe containing the list of working or processing required to be carried out on non-originating materials so that the product manufactured can obtain originating status (often known as the "list rules") and is preceded by an annex containing introductory notes to the list rules.


Here, ANNEX II holds the LIST OF REQUIRED WORKING OR PROCESSING


This list of working or processing is based on the HS and contains for each position the appropriate condition(s). A position can be all products of a chapter, a heading or a group of headings or just a specific selection of these products (so-called "ex" position).


Step 1: Tariff classification

Therefore, to use the list of working or processing it is necessary first to identify the tariff heading of the finished product.


Step 2: What's the product-specific rule?

Secondly, it must be checked whether the finished product has complied with the qualifying process listed in the column for the finished product of that heading. (If this is not the case, a product may still be originating if the value of the non-originating materials does not exceed the general tolerance rule, where applicable)


Examples of types of rules you may find

There are several types of rules, but the most common (see table of examples) are:

  • that only wholly obtained materials can be used

  • that non-originating materials from certain positions can be used in or are excluded from the working or processing

  • that a specific working or processing operation must be carried out

  • that a certain percentage of value is added or cannot be exceeded in the production process

  • a combination of different rules

  • that a choice between different rules is given

or

Explanation of the rules:


"Manufacture from materials of any heading, except that of the product and of heading xxx"

A product complies with the rule when all non-originating materials used in its production are classified in a different HS heading than the product, except the specific non-originating materials mentioned in the rule, which cannot be used. The use of non-originating materials at an earlier stage of processing than those excluded by the rule is allowed but the use of non-originating materials that have been further processed is not. While the provisions of the individual arrangements may vary in certain details, most preferential origin arrangements have a number of standard provisions.


Manufacture in which the value of all the materials used does not exceed xxx % of the ex-works price of the product.

A product complies with the rule when the value of all non-originating materials (or specifically mentioned heading(s) or subheading(s)) used in the production does not exceed a given percentage of the ex-works price of the product.


Wholly obtained

Don't forget! If your product is wholly obtained in the UK or Vietnam, it will be considered originating in the UK or Vietnam. This applies mainly to agricultural products, fish, minerals, waste and scrap. For example, to be considered as “wholly obtained” animals need to be born and raised in the UK or a partner country of a trade arrangement; products from animals (e.g. milk) need to come from animals raised there; plants need to be grown or harvested there.


Please note that in determining whether a product is wholly obtained, you should in practice disregard the origin of:

  • neutral elements, meaning factors of production, such as fuel, tools or machines used to produce your product,

  • packing materials and containers for shipment used during transportation,

  • packaging materials used for retail sale when classified with the product,

  • accessories, spare parts, tools and information materials if they are delivered and invoiced with the product.

QUESTION 4: Can I leverage the flexibility in the agreement to help me comply with the rules?

Cannot quite make it? There is certain flexibility allowed to help you comply with the rules. Does that help?

  • If in the production of a product you use materials that have already obtained originating status, you can count them as 100% originating (even if those materials were produced using non-originating materials). This is called the absorption principle.

  • Tolerance rules allow you to use a limited quantity of non-originating materials that are normally prohibited by the product-specific rule.

  • The ability to consider materials from or processing carried out in, another country as originating when incorporated into your product is called cumulation.  If materials originating in Vietnam have been used in the production of your product in the UK, you can count them as originating in the UK (and vice versa). This is called bilateral cumulation.

  • If your product is a set, you can apply an additional tolerance.

QUESTION 5: How do I prove that I meet the rules of origin?


To benefit from preference, originating products need to be accompanied by the appropriate proof of origin confirming their origin. When goods are claimed to have a particular preferential origin, the customs authorities of the importing country must be satisfied that the claim is correct and thus a proof of that origin is required. The different preferential arrangements require specific proofs of origin relevant to specific arrangements.


Importers and exporters are advised to check which particular proof of origin is required to substantiate their claims to preferential origin. Declaration on certain commercial documents (an invoice, a delivery note or any other commercial document which describes the products concerned in sufficient detail to enable them to be identified - the so-called "invoice declaration") can often replace the specific proof of origin. This is subject to prior authorisation by the customs authorities granted to approved exporters. Additionally, most arrangements allow the use of "invoice declarations" made out by the exporter for any consignment under a certain value.



QUESTION 6: How can a business claim for a preferential tariff at import?

In the UK-Vietnam Free Trade Agreement, importers in the UK can claim preferential tariff treatment based on either:


  1. a certificate of origin made out in accordance with Articles 16 (Procedure for the Issuance of a Certificate of Origin) to 18 (Issuance of a Duplicate Certificate of Origin);

  2. an origin declaration made out in accordance with Article 19 (Conditions for Making out an Origin Declaration) by: an approved exporter within the meaning of Article 20 (Approved Exporter) for any consignment regardless of its value; or any exporter for consignments the total value of which does not exceed EUR 6 000;

  3. a statement of origin made out by exporters registered in an electronic database in accordance with the relevant legislation of the UK after the UK has notified to Viet Nam that such legislation applies to its exporters.


QUESTION 7: How do the customs authorities verify the origin of the product?

The customs authorities may verify whether a product imported is indeed originating or fulfils other origin requirements. The UK-Vietnam Free Trade Agreement is based on the following principles:

  • Verification is based on administrative cooperation between customs authorities of the importing and the exporting Party.

  • Checks on the origin of the products are done by local customs meaning visits of the importing Party to the exporter are not allowed.

  • The importing Party makes the final determination of origin.


QUESTION 8: What should exporter and importer do if they are not sure about the origin?


If you are uncertain about the origin of your products, or if you simply want legal certainty, you may apply for an Advanced Origin Ruling for goods imported to the UK. To do so, you should make an application to HMRC. The authorities have 120 days from the date they registered the application to make a decision. It's important to note that AORs are binding on both the holder and on the UK customs authorities. However, the condition is that the goods and the circumstances described in the application for the AOR are identical in every respect. Normally, AORs are valid for up to three years from the date of issue. It's important to note that the existence of an AOR does not exempt you from the requirement to provide proof of origin.


QUESTION 9: Where do I find the Rules of Origin?


In order to be eligible for tariff-free trade under the UK Free Trade Agreements (FTAs), it is imperative that businesses thoroughly review and understand the specific Rules of Origin for each FTA. You can find all the necessary Rules of Origin right here

QUESTION 10: Where can I find out more about Rules of Origin?


See our dedicated page on all matters Rules of Origin: https://www.customsmanager.info/all-news/categories/rules-of-origin


About Customs Manager’s Customs & Global Trade Intelligence Services

The Premium Professional Legislative Monitoring Service (PLM) is a research and curation service which checks for legislative updates from official government websites based on the selected jurisdictions and topics. Paid Plan subscribers can access regular law change notifications to ensure they never miss a significant legal change on www.customsmanager.info – a website dedicated to customs & trade intelligence. At the same time, they save valuable time by engaging our dedicated trade specialists to carry the monitoring out for them. Premium subscribers also unlock all content on the Customs Manager’s Ltd. website, including our Customs & Trade Blog on www.customsmanager.info , providing vital thought leadership development services to empower them to trade effectively, efficiently and, of course, compliantly, across borders. Premium Subscribers can add jurisdictions and topics for an additional charge.


About Customs Manager Ltd.

We aim to empower people with import, export and transport responsibilities with helpful advice, insightful training and relevant trade intelligence services. We devote all our passion and energy to helping businesses grow faster cross-border. Working with us means having your own multilingual Customs Manager on standby to help you trade effectively, efficiently and, of course, compliantly wherever you want to go. Includes Brexit support and the ability to lodge customs declarations + Rules of Origin


Stay in Touch

· Twitter: @customsmanager

Important Notice

Customs Manager Ltd. owns the copyright in this document, except for external documents and links we refer to or make available.

You are not allowed to use this information in any way that infringes its intellectual property rights. You may have to hold a valid licence to use this information. A licence can be obtained by becoming a Paid Plan subscriber to the Customs Managers’ Customs & Trade Intelligence service, also known as Professional Legislative Monitoring (PLM). As a Paid Plan subscriber, you may download and print this information which you may then use, copy or reproduce for your internal non-profit-making purposes.

However, you are not permitted to use, copy or reproduce this information to profit or gain.

In addition, you must not sell or distribute this information to third parties, not members of your organisation, whether for monetary payment or otherwise.

This information is intended to serve as general guidance and not constitute legal advice. The application and impact of laws can vary widely based on the specific facts involved. This information should not be used as a substitute for consultation with professional legal or other competent advisers. Before making any decision or taking action, consult a Customs Manager Ltd. professional.

In no circumstances will Customs Manager Ltd be liable for any decision made or action taken in reliance on the information contained within this document or for any consequential, special or similar damages, even if advised of the possibility of such damages.

Comments

Terms of Website Use

Cookie policy

Privacy policy

© 2025 by Customs Manager Ltd.

bottom of page