Overview of RCEP Case Model
The advantage of RCEP include
- Expanded Market Access
- RCEP reduces trade barriers among its 15 member countries, increasing market access for exporters and providing new market opportunities.
- Integrated Supply Chains
- The agreement promotes integrated supply chains in manufacturing and production sectors, lowering production costs and enhancing productivity.
- Standardization of Regulations
- RCEP stabilizes the business environment and attracts investment through the standardization of regulations, making it easier for companies to operate in diverse markets.
- Regional Economic Integration
- By facilitating economic integration in the Asia-Pacific region, the agreement strengthens regional cooperation.
A model for increased ease of origin compliance due to intra-area expansion (cumulative basis)
Intra-area expansion
RCEP covers 15 member countries, providing the widest scope of countries from which origin materials can be sourced, making it easier to meet origin determination criteria. These countries include the 10 ASEAN nations (including the Philippines), South Korea, China, Japan, Australia, and New Zealand.
Bilateral Agreement
RCEP
Multilateral Agreement
Precautions when using cumulative basis
Despite applying cumulative criteria under Article 2.6 of the RCEP concerning the
non-discrimination of tariffs, the origin of the final product may be determined as
originating from a different member country. (Confirmation required regarding "Article 2.6
Tariff Discrimination")
While material accumulation can be utilized immediately upon the agreement's entry into force, full accumulation is regulated to be reviewed within five years from the commencement of the review process. (Decision on future adoption to be made)
While material accumulation can be utilized immediately upon the agreement's entry into force, full accumulation is regulated to be reviewed within five years from the commencement of the review process. (Decision on future adoption to be made)
Cumulative basis Case Model
- Product
- Engine Oil
- HS code
- 2710.19
- Origin criteria (PSR) are as follows
- RCEP, ACFTA, AANZFTA
- CTH or RVC 40%
Producer A in the Philippines imports lubricating oil (HS code 2710.19) from Japan and exports engine oil (HS code 2710.19) to China and Australia
Origin Determination
ACFTA
- PSR
- CTH or RVC 40
- Determination
- Does not meet CTH (2710=2710) => Non PH Origin
AANZFTA
- PSR
- CTH or RVC 40
- Determination
- Does not meet CTH (2710=2710) => Non PH Origin
RCEP
- PSR
- CTH or RVC 40
- Determination
- CTH are met (Lubricant is RCEP Origin) => PH Origin