With an aim to prevent misuse of tariff concessions under the India-UK Comprehensive Economic and Trade Agreement (CETA), the Centre has notified detailed Rules of Origin, wherein it has said that minor processing activities such as packaging, washing, labelling, polishing or simple assembly will not qualify as originating in either country for claiming preferential customs duty benefits.
The government has also made it clear that the goods imported from the UK will qualify for preferential tariff treatment under CETA only if they are wholly obtained or produced in either country, made entirely from originating materials, or manufactured using non-originating inputs that satisfy prescribed product-specific rules of origin, according to rules notified by the government ahead of the trade pact's entry into force on July 15.
Rules of origin criteria are used to determine to national origin of an internationally traded product. These rules are important for levying duties, and enforcing FTA benefits and restrictions. The notification, issued by the Central Board of Indirect Taxes and Customs (CBIC) on Friday, will be effective from July 15, 2026.
“Affixing or printing marks, labels, logos and other like distinguishing signs on products or their packaging,” and simple assembly of parts of articles to constitute a complete article or disassembly of products into parts,” will not be considered to be originating as per CBIC.
The rules lay down the origin criteria, documentation requirements, verification procedures and product-specific conditions for claiming duty concessions under the agreement. The rules are intended to ensure that goods substantially manufactured in India or the UK, and not merely routed through either country, receive preferential market access.
The rules define simple assembly as an activity that neither requires specialised skills nor dedicated machinery, signalling the government's intent to prevent superficial processing from being used to obtain tariff preferences.
For imports into India, preferential tariff claims will have to be supported by an origin declaration completed by the exporter or producer. The declaration will be valid for 12 months, must accompany the invoice or another commercial document identifying the goods, and must be furnished in English.
Customs authorities may deny preferential tariff treatment if the goods fail to satisfy the origin requirements or if adequate information is not furnished during verification.
The notification also introduces a tolerance provision that allows limited use of imported inputs without disqualifying a product from preferential treatment. The rules also clarify that products retain their originating status while passing through third countries only if they remain under customs control and do not undergo any further production apart from limited activities necessary to preserve them in good condition. They also allow for cumulation, under which originating materials from one partner country can be treated as originating in the other when used in the manufacture of a qualifying product.
Importers claiming preferential tariff treatment will be required to preserve supporting records for at least four years, while exporters and producers must retain origin-related documents for five years.