The International Trade Council is pleased to announce that Cambodia has recently ratified a new Rules of Origin (ROO) law on July 5, 2023, in alignment with World Trade Organization (WTO) benchmarks.
Key Highlights of the New Law:
Uniform Criteria for Product Source Identification: This legislation furnishes businesses with a comprehensive and uniform criterion for ascertaining a product's origin, ensuring streamlined access to preferential trade treatment, provided ROO conditions are met.
Combating Counterfeit Goods: Besides fostering international trade, this law empowers the Cambodian government to impose necessary trade restrictions and target counterfeit goods.
Consistency with Existing Agreements: The law's formulation benefitted from collaborations with the WTO and the UN Conference on Trade and Development (UNCTAD). As such, it remains consistent with ongoing free trade agreements (FTAs) and arrangements with WTO member nations.
Understanding Rules of Origin (ROO): ROO are the guidelines determining the source country of a product. These rules are vital for categorizing goods based on their origin, which subsequently influences their duties, restrictions, or preferential treatments.
Cambodia’s Approach with the New ROO: Cambodia’s new law delineates the criteria for products' origins, for both preferential and non-preferential treatments. While the criteria for preferential products align with existing trade agreements, the law provides new ROO criteria for non-preferential items. Additionally, penalties have been outlined for origin falsification, alongside mechanisms for resolving disputes.
Impact on Cambodia’s International Trade: The revamped ROO is projected to bolster Cambodia's external trade relationships by providing clarity and predictability for foreign traders. With more transparent criteria, traders can effortlessly procure certificates of origin (COO), ensuring consistent alignment with both Cambodia's ROO and those of its trade partners. This enhancement can potentially uplift Cambodia's overall exports and stimulate economic progression.
Cambodia's Strategic Intent with the New ROO: Being a participant in multiple FTAs, Cambodia recognizes the value of adhering to uniform standards. This new law not only amplifies Cambodia's credibility in the global trade community but also positions it advantageously for future FTA negotiations.
The International Trade Council commends Cambodia on this significant step towards facilitating international trade and remains dedicated to fostering global economic collaborations.
About the International Trade Council: The International Trade Council is a neutral global entity dedicated to promoting international trade relationships between nations, industries, and businesses, focusing on sustainable global economic progress.