EC proposes relaxing the rules of origin for Western Balkan goods to boost trade

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BRUSSELS – The European Commission yesterday adopted a package of proposals that aims to increase trade between the European Union and neighbouring countries in the Pan-Euro-Mediterranean (PEM) region, including the Western Balkans, thereby contributing to the economic recovery following the coronavirus outbreak.

The proposals will modernise the EU’s preferential trade agreements with 20 PEM trading partners by making the relevant ‘rules of origin’ in those agreements more flexible and business-friendly, the EC stated.

These proposals amend the EU’s bilateral agreements with Albania, Bosnia and Herzegovina, North Macedonia, Montenegro, Serbia and Kosovo, among other countries.

According to the Commission’s statement, the ‘rules of origin’ are necessary under any trade agreement because they determine which goods can benefit from preferential treatment. The ‘origin’ is the ‘economic nationality’ of the goods traded.

Origin procedures ensure that customs authorities can verify the origin of a good and allow businesses to prove the origin of their goods. When all the necessary requirements are met, goods with preferential origin are eligible to be imported with lower duty rates, or even a zero rate, depending on the preferential tariff treatment.