Publication date 07 January 2014
NEW EU GENERALISED SCHEME OF PREFERENCES (EU GSP) AS OF 2014: UPDATE
We refer to our past trade and customs alert from December 2012 and would like to recall that as of January 1, 2014 the renewed EU GSP scheme entered into force. Under the new GSP scheme the EU focuses its preferences on countries most in need which do not benefit from a separate preferential market access scheme, such as free trade agreements (with the exception of the least-developed countries).
1. New EU GSP
The new EU GSP consists of three different types of arrangements.
General arrangement (duty free access for non-sensitive originating products)
As of January 1, 2014, the following 31 GSP beneficiary countries will benefit from the general arrangement: Azerbaijan, China, Colombia, Cook Islands, Guatemala, Honduras, India, Indonesia, Iran, Iraq, Kyrgyzstan, Maldives, Marshall Islands, Micronesia, Nauru, Nicaragua, Nigeria, Niue, Panama, Philippines, El Salvador, Sri Lanka, Syria, Tajikistan, Thailand, The Congo, Tonga, Turkmenistan, Ukraine, Uzbekistan and Vietnam.
GSP+ arrangement (duty free access for most of the originating products)
As of January 1, 2014, the following 10 GSP beneficiary countries will benefit from the GSP+ arrangement: Armenia, Bolivia, Costa Rica, Cape Verde, Ecuador, Georgia, Mongolia, Peru, Pakistan and Paraguay. Note, Pakistan is the sole addition to the list; the country previously benefited from a duty exemption on various textile and apparel products which expired December 31, 2013.
EBA arrangement (duty free access for all originating products, except for arms)
As of January 1, 2014, 49 least-developed countries defined by the UN benefit from the EBA arrangement. Current revisions to the EBA include the addition of South Sudan and the removal of the Maldives.
We like to flag that:
2. Product graduation
As of January 1, 2014, the product graduation regulation will not apply to Ecuador as it gained the GSP+ status (2014 only). Effective January 1, 2015, the product graduation regulation will no longer apply to China, Ecuador and Thailand as these countries will be removed from the list of GSP beneficiary countries. It follows that beginning January 1, 2015, product graduation will likely only apply to certain products originating in Costa Rica, India, Indonesia, Nigeria and Ukraine.
3. Impact on your business
The new EU GSP scheme requires close monitoring by your business due to its continuous revision. Over the years KPMG Meijburg & Co has gained extensive experience in carrying out preferential origin impact assessments and optimizing the use of preferential customs duty systems around the globe.