Status – Origin – Made in – Protected Designation of Origin
Four concepts worth distinguishing
Maroš Prosman, DAC Consulting 2.0, s.r.o.,
One consignment, one question – and as many as four potential legal answers. The status of goods, the origin of goods, the “Made in” indication and the protected designation of origin sound similar, yet each of them says something different, under different rules and before a different authority. Anyone who confuses them above all misunderstands the essence of customs law and, in the worse case, risks a post-clearance duty assessment, the loss of a customs preference or a fine.
1. Status and origin: the citizenship and nationality of goods
With a degree of simplification, let us think of goods by analogy with a person. Origin is their “nationality”: a given fact that arose when the goods were produced or extracted and that nothing in their subsequent fate will change. Status is their “citizenship”: a legal bond with the customs territory of the Union that can be both acquired and lost.
Origin answers the question of the country in which the goods came into being economically. Goods grown, extracted or wholly manufactured in one country originate in that country. Where more than one country is involved in their production, they originate where they underwent their last substantial processing. Transport, sale or customs clearance change nothing in this respect.
Status answers the question of whether the goods are Union goods, i.e. goods that circulate freely within the customs territory without further customs formalities. Union goods are goods wholly obtained or produced in the Union, as well as goods from a third country that have been released for free circulation. Release for free circulation is a kind of naturalisation: the importer pays the duty, completes the formalities and the goods then move around as domestic goods. On leaving the customs territory, the goods lose this status.
The two concepts meet at a single point: the fact that they get confused. Chinese goods released for free circulation in Hamburg become Union goods (status), but their origin remains Chinese, and the “Made in China” indication on them remains, as such, true. Conversely, goods originating in the Union lose their Union status when they are transported out of the customs territory of the Union, but they retain their Union origin. Union goods are therefore not the same as goods originating in the Union. The same mistake recurs with the A.TR movement certificate used in trade with Turkey: it certifies the status of goods within the customs union, not their origin. For customs law, status is the first question, because it determines whether the goods are subject to customs supervision and formalities at all. Origin comes in only with the second question: what duty and what measures apply to the goods.
2. Two origins: non-preferential and preferential
Customs law, moreover, recognises two kinds of origin, each serving a different purpose.
Non-preferential origin is the basic one. All goods have it, and no one needs to invoke it; it simply exists as a matter of fact. It determines the standard rate of duty, anti-dumping duties, prohibitions, restrictions and quotas, and feeds into trade statistics. It must be stated in the customs declaration.
Preferential origin is an add-on. It exists only where a specific free trade agreement or other preferential arrangement establishes it, and it is the ticket to a reduced or zero rate of duty. The conditions are stricter than for non-preferential origin, and without valid proof, such as an EUR.1 movement certificate or a statement on origin, preferential origin does not exist in practice. In addition, countries participating in a common system can add up origin thanks to the rules of cumulation: materials originating in one contracting country also count towards production in another.
Importantly, the two origins of the same goods may diverge. An example from the meat industry: cattle are born and raised in North Macedonia, then fattened for several months and slaughtered in Serbia. The non-preferential origin of the meat is Serbian, because the last decisive stage took place in Serbia. Thanks to cumulation, however, the meat retains North Macedonian preferential origin, because slaughter alone does not count as sufficient processing for preferential purposes. One consignment, two countries of origin, both correct.
3. “Made in”: an indication without its own definition
Many are surprised to learn that EU law does not define the “Made in” indication for ordinary industrial goods at all, nor does it require it to be used. Marking is voluntary for most non-food products. However, once a manufacturer or seller decides to use the indication, its accuracy is measured by the customs yardstick: what counts is non-preferential origin, i.e. the country of last substantial processing. “Made in Slovakia” on a product assembled from imported parts holds up only if the assembly was that substantial step.
Food lives in its own, stricter world. The origin of a food must be indicated whenever omitting it would mislead the consumer, and several foods are subject to special regimes; fresh meat, for example, bears information on the countries of rearing and slaughter. The meat from our example thus presents the consumer with yet a third picture: the label will mention both North Macedonia and Serbia. Three answers to the question of where the goods come from, each correct within its own regime.
It also matters who polices “Made in”. A false indication of origin is a misleading commercial practice dealt with by the Slovak Trade Inspection (SOI) or, where applicable, by a court in an unfair competition dispute. The customs office does not check labels on the market; it is interested in the origin declared in the customs declaration. The reverse also holds: a label is not proof of origin in customs proceedings. If, however, the indication on the goods differs from the information in the declaration, this is an invitation for inspectors to take a closer look.
4. Protected designation of origin: a concept from another world
The fourth concept belongs to intellectual property law. Protected designations of origin and protected geographical indications, such as Tokaj or Skalický trdelník, link a product to a territory not by a customs test but by quality: the product must comply with the registered specification, and its characteristics or reputation must derive from the defined area. A register of entries is kept, and only those who comply with the specification may use the designation.
This instrument must not be confused with customs origin. A product bearing a protected designation naturally also has a customs origin, but that origin is determined independently and under different rules. There is, however, one point of contact with the customs world: protected designations are among the rights that customs authorities enforce at the border, so they can detain imitations on import. An ordinary false “Made in” indication enjoys no such border protection.
5.Conclusion
Anyone who keeps these four concepts and instruments apart can read a customs declaration, a label and a register without surprises. A simple table helps.
| Concept | Question it answers? | Who assesses it and how it is proven |
|---|---|---|
| Status of goods | Are these Union goods that circulate freely within the customs territory? | customs authorities; proof of status |
| Non-preferential origin | In which country did the goods come into being economically, and what duty and measures apply? | customs authorities; not proven as such – proof of origin is submitted only on request |
| Preferential origin | Are the goods entitled to a reduced rate under an agreement? | customs authorities; EUR.1 or statement on origin |
| „Made in“ a etiketa | Does the marking tell the consumer the truth? | Slovak Trade Inspection (SOI) and courts |
| Protected designation of origin | Does the product comply with the registered specification linked to a territory? | EU register of geographical indications (eAmbrosia); in Slovakia, applications via the Industrial Property Office (ÚPV SR), specification verified by the State Veterinary and Food Administration (ŠVPS SR), for wines together with the Central Controlling and Testing Institute in Agriculture (ÚKSÚP); at the border, customs authorities |
A practical rule to finish: origin is never copied into the customs declaration from the label, and a label is never defended with a customs certificate. Each indication has its own regime, its own proof and its own guardian.