What is an Electronic Certificate of Origin (e-CO)
What is an e-CO and how to get an Electronic Certificate of Origin (e-CO)? A Certificate of Origin (CO) is a document used in international trade to attest that a product has met certain criteria that it originates from a specific country. A CO serves as proof certifying the origin of the product, which is used as basis to determine tariffs and other treatments that will be applied. It is usually the exporter or product manufacturer who prepares the e-CO with another party certifying the document.
There are two types of Certificates of Origins (Cos), preferential and non-preferential/generic.
Preferential Certificates of Origin. This type confirms that goods are subject to exemptions or reduced tariffs when exported to countries that have a free trade agreement with the importing country.
Non Preferential Certificates of Origin (Generic). This confirms that the product being imported does not qualify under any free trade agreements. Most COs fall under this type.
Satisfying rules of origin with a Certificate of Origin is a normal requirement when an importer/exporter wants to claim preferential status for a product or item from a customs agency. An example is reduced or free tax or duty through trade agreements. Unlike the exporter, the importer seldom knows whether the product meets rules of origin. The importer thus relies on the certificate of origin provided by the exporter as proof to be presented to the customs authority before the shipment can enter the destination country.
Besides satisfying border control requirements, a certificate of origin also certifies the source of a product. This is valuable for importers of exclusive products and for marketing purposes. Certificates of origin may also help determine whether an item can be imported legally, especially for goods subject to quota or sanctioned goods from certain countries.
The country of origin of a product as listed in the certificate is determined by multiple factors. It’s not automatically the country of the exporter, but the country where the product is obtained or manufactured. Rules of origin vary with the product being imported.
In the event that two or more countries are involved in the manufacture of a product, the country of origin is considered to be the country where the last substantial economically justified processing is done. For transshipments, the relevant agency in the transit country may issue back-to-back certificates of origin based on the original, where the transit country is different from the actual country of origin.
Electronic Certificate of Origin (e-CO)
An electronic certificate of origin or e-CO is a digitized version of the CO. e-COs replace cumbersome and time-consuming paper documents while facilitating trade and improving transparency. The e-CO, along with other required electronic documentation, is submitted by the importer to a customs agency that determines admissibility. The chamber of commerce decides whether the item or shipment is eligible for preferential treatment (e.g. duty free, tax free) based on these documents.
The shift to electronic processing in the public and private sectors has increased the importance of e-documents like the e-CO, and many agencies have developed e-CO platforms to facilitate adoption and anticipate the rise in volume of e-documents. The World Trade Organization (WTO) Agreement on Trade Facilitation has provided a new benchmark for the use of electronic documents, including certificates of origin:
Essentially, members should accept paper or electronic supporting documentation.
When the government agency already holds the original document, any other agency should accept a paper or electronic copy.
In addition, members should not require an original or copy of export declarations as an import requirement.
Why You Need an eCO
Paper certificates of origin, from preparation to certification to submission, is a time-consuming and labor-intensive process, especially for high-volume exporters. You must complete the paper form, send it to the chamber by mail, wait for it to be reviewed and certified, and then send it by mail to the importer. Long wait times before receiving the certificate is not unusual particularly during busy times. An electronic certificate of origin is both cheaper and faster.
How Does the Electronic Certificate of Origin Work?
An electronic certificate of origin is prepared, submitted, and certified online. You simply enter the required information on the e-document, submit it and wait for the certificate to be delivered by email or express mail (for hard copies). You can then email it to the importer or send the hard copy by courier. The importer will submit the e-CO along with other required e-documents to customs for clearance purposes. The entire process is similar to the paper CO, but faster and more streamlined.
How to Create & Obtain an Electronic Certificate of Origin (e-CO)
Before you can create an e-CO, you must first register an account at the designated online portal of the chamber of commerce or controlling agency. Once your account is set up, you can proceed to prepare the e-CO. Complete the e-form and submit along with other supporting documents. In the United States, submissions are reviewed and approved by the chamber of commerce accredited by the International Chamber of Commerce World Chambers Federation (ICO). This takes about a day or two. You will receive the e-CO, along with important messages and notifications, in your account inbox.
Self-Certification and Authorized Certification
Self-certification or authorized certification are two ways of obtaining certificates of origin. With self-certification, the exporter or manufacturer has the right to determine whether the product is in compliance with the rules of origin and the right to issue the certificate. Sometimes, this can be as simple as a sworn declaration on a separate document or included in the official invoice.
For third party certifications, the certificate of origin is usually signed by the exporter or the manufacturer, and countersigned by a local issuing body, such as a chamber of commerce or a customs authority. The certification agency may require documents that describe the manufacturing process, facility and other details.
Benefits of Using the Electronic Certificate of Origin
Faster processing. Obtaining a paper certificate of origin can take days or even weeks. You must hire a courier service to deliver the document to the Chamber office, wait for the certification, and wait again for the courier to deliver it to you. The e-CO process is completely digital, ensuring quick processing and approval. You can download and print the e-CO once it’s in your inbox.
Transparency. Having a central portal for exporter credentials, product information and e-CO application means greater accuracy and transparency. Other relevant agencies can access the supporting documents and data you provided without requesting new copies. This cuts down on errors and redundancies.
Cheaper than paper COs. Courier delivery plus certification fees can add up. With e-COs, the costs can be as low as $50 per certificate. Businesses can also avoid costs associated with maintaining paper archives.
Secure processing. Online portals are designed to protect and maintain the data submitted by filers. Security measures adhere to international standards to ensure that certificates of origin are tamper proof.
GeTS Solutions for Electronic Certificate of Origin (e-CO)
Global eTrade Services (GeTS) helps trade participants streamline the preparation and submission of generic electronic certificates of origin. The eCO System is a web-based application that provides an integrated, electronic process for faster online application and certification of non-preferential Certificates of Origin (CO).
GeTS eCO allows the immediate transmission of certified COs to designated third party recipients in a secure electronic environment. Subscribers can benefit from reduced costs, reduced errors and duplicate entries and improved productivity. GeTS eCO service is ideal for exporters, traders, manufacturers, shippers, banks and chambers of commerce.
To learn more, visit our Electronic Certificate of Origin (e-CO) page or contact us today!