Annex 3A: Product-Specific Rules

Section A: Headnotes to the Annex

General Notes

1. For the purposes of this Annex:
   1. "chapter" means the first two digits of the tariff classification number under the Harmonized System;
   2. "heading" means the first four digits of the tariff classification number under the Harmonized System;
   3. "sub-heading" means the first six digits of the tariff classification number under the Harmonized System.
2. The product specific rule, or set of product specific rules, that applies to a particular sub-heading is set out immediately adjacent to the sub-heading.
3. Section, chapter or heading notes, where applicable, are found at the beginning of each section, chapter or heading, and are read in conjunction with the product specific rules of origin and may impose further conditions on or provide an alternative product specific rule of origin.
4. A requirement of a change in tariff classification applies only to non-originating materials.
5. If a chapter, heading or sub-heading is excluded as part of a change in tariff classification rule, it means that non-originating materials of that chapter, heading or sub-heading may not be used to meet the change in tariff classification rule. All materials that are excluded must be originating goods.
6. Where a heading or sub-heading is subject to alternative product specific rules, the requirements of this Annex will be considered to be satisfied if a good satisfies one of the alternative rules.
7. If a good is subject to a product specific rule that includes multiple requirements, the requirements of this Annex will be considered to be satisfied for that good only if the good satisfies all applicable requirements.

8. For the purposes of Section B of this Annex:

   1. "CC" means that all non-originating materials used in the production of the good have undergone a change in tariff classification at the two-digit level;
   2. "CTH" means that all non-originating materials used in the production of the good have undergone a change in tariff classification at the four-digit level;
   3. "CTSH" means that all non-originating materials used in the production of the good have undergone a change in tariff classification at the six-digit level;
   4. "FF" means that the good must undergo a change from fabric that is constructed but not further prepared or finished provided that it is dyed or printed and undergoes at least one preparatory or finishing processes in the territory of one or both of the Parties to render it directly usable; and
   5. "QVC" Qualifying Value Content as per Article X.5 (Qualifying Value Content).

   The Qualifying Value Content can be based on FOB or Ex-Works, however, a 5% differential in value will apply depending on which option is used. In the case that Ex‑Works price is the basis, the Qualifying Value Content shall be 5 percentage points lower. For example, 40% value addition on the basis of FOB value and 35% value addition on the basis of Ex‑Works price.

Chemical Reaction Rule

9. Notwithstanding the applicable product-specific rules of origin, a good of Chapter 28 through Chapter 40 that is the product of a chemical reaction is an originating good if the chemical reaction occurs in the territory of one or more of the Parties.
10. For the purposes of this rule, a chemical reaction is a process (including a biochemical process) which results in a molecule with a new structure by breaking intramolecular bonds and fomenting new intramolecular bonds or by altering the spatial arrangement of atoms in a molecule.
11. The following are not chemical reactions:
    1. dissolving in water or other solvents;
    2. the elimination of solvents, including solvent water; or
    3. the addition or removal of water of crystallization.

Purification Rule

12. For the purposes of Chapter 28 through Chapter 35, Chapter 38, or Chapter 39, purification is considered to be origin conferring provided that one of the following criteria is satisfied:
    1. purification of a good resulting in the elimination of 80 per cent based of the content of existing impurities; or
    2. the reduction or elimination of impurities resulting in a good suitable for one or more of the following applications:
       1. pharmaceutical, medicinal, cosmetic, veterinary, or food grade substances;
       2. chemical products and reagents for analytical, diagnostic or laboratory uses;
       3. elements and components for use in micro-elements;
       4. specialized optical uses;
       5. non toxic uses for health and safety;
       6. biotechnical use;
       7. carriers used in a separation process; or
       8. nuclear grade uses.

Mixing and Blending Rule

13. Notwithstanding the applicable product-specific rules of origin, a good of Chapter 30 through Chapter 31, Headings 3302, 3506, 3507, 3707 or Subheading 3502.20, is an originating good if, in the territory of one or more Parties, the deliberate and proportionally controlled mixing or blending (including dispersing) of materials to conform to predetermined specifications results in the production of a good having physical or chemical characteristics that are relevant to the purposes or uses of the good and are different from the input materials.

Change in Particle Size Rule

14. Notwithstanding the applicable product-specific rules of origin, a good of Chapter 30 through Chapter 31, Chapter 33, or Chapter 39, is an originating good if, in the territory of one or more Parties, the deliberate and controlled modification in particle size of a good occurs, including micronizing by dissolving a polymer and subsequent precipitation, other than by merely crushing or pressing, resulting in a good with a defined particle size, defined particle size distribution or defined surface area,  that is relevant to the purposes of the resulting good and has different physical and chemical characteristics from the input materials.

Standard Materials Rule

15. Notwithstanding the applicable product-specific rules of origin, a standard material of Chapter 28 through Chapter 32, Chapter 35, or Chapter 38, is an originating good if the production of such good occurs in the territory of one or more of the Parties.
16. For the purposes of this rule, a standard material (including a standard solution) is a preparation suitable for analytical, calibrating or referencing uses with precise degrees of purity or proportions certified by the manufacturer.

Isomer Separation Rule

17. Notwithstanding the applicable product-specific rules of origin, a good of Chapter 28 through Chapter 32, or Chapter 35, is an originating good if the isolation or separation of isomers from mixtures of isomers occurs in the territory of one or more of the Parties.

Washing and Drying

18. For the purposes of Chapters 50, 52 through 55, or 58, if a claim for origin is based on dyeing, printing and at least two subsequent finishing processes, washing or drying shall not be considered to be finishing processes. An indicative list of finishing processes is provided in this Annex's Appendix.

Section B: Product Specific Rules