Report of the OTO Advisory Council (April 12, 1993)

3-(3) Relaxing regulations requiring presentation of an original certificate of origin in examinations for preferential tariffs.

1. Complainant: Keidanren

2. Ministry concerned: Ministry of Finance

3. Complaint:

In order to import items under preferential tariffs, an original certificate of origin issued by the customs authorities of a country enjoying preferential tariffs must be presented when carrying out customs formalities. (However, if the item is not under limit controls [in terms of value or volume] for preferential treatment, and if the customs authorities agree that it is difficult, through no fault of the importer, to obtain a certificate of origin, on the understanding that the certificate will be provided afterwards, the importer may be granted an extension to produce the certification in exceptional cases. But if the item is under limit control, an original certificate must be produced, except if unobtainable due to disaster.)

In the particular case brought up by the complainant, a certificate of origin had already been obtained at the source, but the original had not arrived by the time import processing began. The situation was explained to the customs authority, but no extension was granted because it was unclear whether the situation was the importer's fault, and finally the importer gave up trying to import under the preferential tariff.

The complainant feels that examination for preferential tariffs should be more flexible, allowing preferential tariff treatment even if the importer is unable to ascertain why local conditions caused a delay in obtaining a certificate of origin, by having a copy of the certificate sent by facsimile, on condition that the original be provided later, and that importers should be allowed to submit an original certificate of origin later, for items under preferential limit control as well.

4. Results of deliberation:

Extensions for supplying certificates of origin are currently granted only when the certificate is unavailable because of circumstances which are not the importer's fault. But when the importer cannot ascertain the reasons for the delay at the source, it is impossible to demonstrate to the customs authorities that this is not the importer's fault. As a result, cases may arise where items cannot be imported under preferential tariffs.

There is little reason for importers intending to obtain preferential tariffs to intentionally delay obtaining a certificate of origin, and in cases where it is certain that the certificate will be provided later, there are little needs to require the importer to prove the reason for the delay.

The procedure was revised in April 1993, when the ministry or agency concerned issued a revised enforcement order under the Temporary Tariff Measures Law and a basic tariff directive. This allows, in the case of items not under limit controls, extensions for providing a certificate of origin (to be supplied later) under certain conditions, even for reasons of unavailability other than disasters or other uncontrollable circumstances.

Regarding items under limit control, these are generally administered strictly in order of arrival, and because fairness in imposing duties must be maintained, revisions of the current system are inappropriate.

Government decision (May 27, 1993)

With regard to regulations requiring the presentation of an original certificate of origin in examinations for preferential tariffs, extensions for providing a certificate of origin should be allowed under certain conditions in the case of items not under limit controls.