Rules of origin have many uses in the global economy, including whether a product qualifies for preferential treatment in a free trade agreement, but, the complexity of these rules can undermine their effective use within cross-border supply chains.
A recent report, authored by Laura Dawson and Brian Staples, commissioned by the Canadian Council of Chief Executives (CCCE), identifies several steps to improve the clarity and consistency of rules of origin. These are:
- Establishing a global database of rules of origin information standards
- Simplifying rules associated with existing agreements
- Ensuring that rules of origin commitments in new free trade agreements be consistent with other free trade agreements
- Reducing penalties associated with errors in origin disclosure
Canada has exercised leadership in origin rules and administration. It is time to do more. Clearer and more consistent rules will help Canadian firms of all sizes. Improved origin management will also benefit consumers by providing reliable information on product sources.