It is very likely that when you are shopping and you have the choice between two similar products, you will check the price, the characteristics and finally the origin of the product. And let’s face it, if two products are worth about the same price and have similar characteristics, you will surely choose the one that was produced in your favorite country.
But do you really know what that means?
Many people think that the label on a product indicates the exact country where the product was made, but this is not true. In fact, products that were not designed in one country can be labeled “made in France”.
The truth is that there are some exceptions where some producers may label their product as being made or produced in France even though this is not entirely true, however the producer must be able to complain about the so-called non-preferential origin laws established by the Customs Union Code (CUD).
The first rule is that a product that is entirely designed and produced in France can carry the label made in France, and yes so far it all makes sense. A product that comes from China for example can still carry the label made in France if it has received the last significant modification in France. Another example is a product that comes from China but the new value added to the product is made in France, then the product can also carry the label made in France.
As you can see, the “made in France” label does not mean that a product was 100% made in France, but that it at least received a significant modification here. But the impacts of the product’s origin go far beyond what one might think. In the case of customs, the import duties on this product can be strongly affected by the origin, for example in the case of preferential origin.
But then what is preferential customs origin?
Preferential customs origin is used by companies to reduce or cancel customs duties based on the preferential relationship that the importer’s country (or customs union) may or may not have with another country.