Paragraph 10 Principle of territoriality
Except as provided for in Article 3 and in paragraph 3 of this Article, the conditions for acquiring originating status set out in Title II shall be fulfilled without interruption in a Party.
Except as provided for in Article 3, where originating goods exported from a Party to another country return, they shall be considered non-originating, unless it can be demonstrated to the satisfaction of the customs authorities that:
the returning goods are the same as those exported; and
the returning goods have not undergone any operation beyond that necessary to preserve them in good condition while in that country or while being exported.
The acquisition of originating status in accordance with the conditions set out in Title II shall not be affected by working or processing done outside a Party on materials exported from the Party and subsequently reimported there, provided that:
the exported materials are wholly obtained in the Party or have undergone working or processing beyond the operations referred to in Article 6 prior to being exported; and
it can be demonstrated to the satisfaction of the customs authorities that:
- (i)
the re-imported goods have been obtained by working or processing the exported materials; and
- (ii)
the total added value acquired outside the Party by applying the provisions of this Article does not exceed 10 % of the ex-works price of the end-product for which originating status is claimed.
For the purposes of paragraph 3, the conditions for acquiring originating status set out in Title II shall not apply to working or processing done outside a Party. But where, in the list in Annex II to this Appendix, a rule setting a maximum value for all the non-originating materials incorporated is applied in determining the originating status of the end-product, the total value of the non-originating materials incorporated in the territory of the party concerned, taken together with the total added value acquired outside the Party by applying the provisions of this Article, shall not exceed the stated percentage.
For the purposes of applying the provisions of paragraphs 3 and 4, ‘total added value’ shall be taken to mean all costs arising outside a Party, including the value of the materials incorporated there.
The provisions of paragraphs 3 and 4 shall not apply to products which do not fulfil the conditions set out in the list in Annex II to this Appendix or which can be considered sufficiently worked or processed only if the general tolerance fixed in Article 5(2) is applied.
Any working or processing of the kind covered by the provisions of this Article and done outside a Party shall be done under the outward processing arrangements, or similar arrangements.