Rules of origin explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
The India-Australia ECTA rules of origin decide which goods qualify for the preferential duty rate when traded between India and Australia. They were made by Notification No. 112/2022-Customs (N.T.) dated 22 December 2022 and came into force on 29 December 2022. This article walks through the rules: the origin criteria with their printed percentages, de minimis, the certificate of origin, post-importation claims and verification.
This article reads the rules as amended up to Notification No. 112/2022-Customs (N.T.) dated 22 December 2022, the notification that made them (in force 29 December 2022; no amendment found in CBIC's 2023-2026 lists). Later notifications should be checked before you rely on the current text.
A good is originating if it is wholly obtained or produced (rule 5) or produced using non-originating materials and meets rule 4 or the Product Specific Rules in Annexure-B (rule 3). The default test in rule 4 is a change in tariff sub-heading plus a qualifying value content of not less than 35 per cent (build-up) or 45 per cent (build-down). The de minimis is 10 per cent (rule 9). A certificate of origin is valid for twelve months (rule 16), and a post-importation claim must be made within twelve months of importation (rule 25).
What the rules are and when they apply
The rules are made under section 5(1) of the Customs Tariff Act, 1975. Rule 1 calls them the Customs Tariff (Determination of Origin of Goods under the India-Australia Economic Cooperation and Trade Agreement) Rules, 2022. The competent authority for India is the Department of Commerce, and the customs administrations are the Department of Home Affairs for Australia and CBIC for India (rule 2). Rule 2 defines "preferential tariff treatment" as the customs duty rate applicable to an originating good under each Party's tariff commitments; the rules print no rate.
For Indian imports, claims are processed under the customs rules explained in our articles on Rules 1 to 4 of the CAROTAR and Rules 5 to 8 of the CAROTAR. Exporters who need an Importer-Exporter Code before applying for a certificate can use our IEC registration service.
One drafting point to note: the build-up formula in rule 7(1)(b) is printed with the value of non-originating materials in the numerator, although the text describes it as based on the value of originating materials. Read the official text before applying the formula to a live case.
The origin criteria (rules 3 to 5)
Rule 3: originating goods
Except as otherwise provided, a good is originating if it is:
- wholly obtained or produced in the territory of one or both Parties, as provided in rule 5; or
- produced entirely in the territory of one or both Parties using non-originating materials, provided it satisfies all applicable requirements of rule 4 or the Product Specific Rules of Origin in Annexure-B.
Rule 4: goods not wholly produced or obtained
For goods that do not qualify under rule 3(a) and are not covered under Annexure-B, a good is originating if all non-originating materials have undergone at least a change in tariff sub-heading (CTSH) of the Harmonized System and the qualifying value content (QVC) is not less than thirty-five per cent of the FOB value under the build-up formula or forty-five per cent of the FOB value under the build-down formula in rule 7. The proviso requires the final production process to be performed in the territory of the exporting Party.
Rule 5: wholly obtained or produced
These include plant goods grown and harvested there, live animals born and raised there and their products, goods obtained by hunting, trapping, fishing, aquaculture, gathering or capturing, minerals extracted from the soil, waters or seabed, marine catch beyond the territories by vessels registered, listed or recorded with a Party and entitled to fly its flag, goods produced on board a registered factory ship, seabed goods where the Party has exploitation rights, waste and scrap fit only for recovery of raw materials or recycling, and goods produced solely from the above. This article does not list the Annexure-B product-specific rules; read the entry for your product.
Accumulation and calculation of QVC (rules 6 and 7)
Rule 6, accumulation: goods and materials originating exclusively in one Party and incorporated in production in the other are treated as originating in the other Party.
Rule 7, qualifying value content: where a QVC requirement applies, it is calculated by the build-down formula (FOB value less the value of non-originating materials, divided by FOB value, multiplied by 100) or the build-up formula. Values are determined under the Customs Valuation Agreement and costs are recorded under generally accepted accounting principles (rule 7(2) and (3)). The value of production of a non-originating material and of originating materials used in it in the territory of one or both Parties may be added to the value of originating materials (rule 7(4)). Materials are valued at CIF value if imported, at the price paid or payable or the earliest ascertainable price if obtained within the territory, or at full cost if self-produced (rule 7(5)). Freight, insurance, packing, duties not refundable and the cost of waste may be added for originating materials, and deducted for non-originating ones, but no adjustment is allowed where the expense is unknown or undocumented (rule 7(6) to (8)).
Minimal operations and de minimis (rules 8 and 9)
Rule 8: operations that alone are insufficient to confer origin include preservation, packaging or presenting goods, simple sifting, sorting, cutting or grinding, textile accessories and ironing, labelling, mere dilution, disassembly, slaughtering, simple painting, polishing, peeling, simple mixing and any combination. "Simple mixing" excludes a chemical reaction as defined in the Explanation, and all operations in a Party are taken together.
Rule 9, de minimis:
| Goods | Printed limit |
|---|---|
| Goods other than Chapters 50 to 63 of the Harmonized System that fail the tariff shift in Annexure-B | Value of non-originating materials not more than ten per cent of the FOB value |
| Chapters 50 to 63 | Total weight of the non-originating materials not more than ten per cent of the total weight of the good |
Packing, accessories, indirect materials, fungible goods and consignment (rules 10 to 15)
- Rules 10 and 11: retail packaging classified with the good is disregarded for tariff-shift or wholly obtained tests and counted in QVC; transport and shipment packing is ignored.
- Rule 12: accessories, spare parts and tools are disregarded for tariff-shift tests and counted in QVC, where not invoiced separately and customary in quantity and value.
- Rule 13: indirect materials are considered originating wherever produced.
- Rule 14: fungible goods are treated as originating by physical separation or an inventory management method used throughout the fiscal year.
- Rule 15, consignment: a good keeps its status if transported directly, or through non-Parties with only unloading, reloading, storing, repacking, relabelling, splitting or consolidating loads or operations needed to preserve it, and under customs control. Evidence may be customs documents of the non-Parties or documents such as airway bills, bills of lading, invoices or a non-manipulation certificate.
Certificate of origin (rules 16 to 20)
Rule 16: the certificate is issued by the issuing body or authority of the exporting Party on application by the exporter, producer or representative. It bears an authorised signature and seal (manual or electronic), is in writing or electronic format, in English, states that the good is originating, contains the Annexure-A information, remains valid for twelve months from completion or issue, applies to a single importation of one or more goods that each qualify in their own right, and carries a unique number. It may indicate two or more invoices for a single importation.
Rule 17: it is issued prior to or within five working days of exportation. Retrospective issue, marked "ISSUED RETROSPECTIVELY", is possible in exceptional cases but no later than twelve months from shipment. Erasures are not allowed. A certified true copy can replace a lost one within the original's validity. Our guide on how to get a certificate of origin in India covers the Indian issuing side.
Rule 18: the application carries supporting documents including the cost break-up, the Annexure-A information and the commercial invoice, and the issuing authority may run risk-based pre-export verification. Rule 19: non-Party invoicing is allowed and must be indicated. Rule 20: the Parties notify issuing bodies and exchange specimen seals.
Claims, records and post-importation claims (rules 21 to 25)
- Rule 21: the importer declares that the good qualifies, holds a valid certificate when the declaration is made, provides a copy if required and, if required, demonstrates compliance with rule 15.
- Rule 22: exporters, producers and issuing bodies keep records for at least five years from issue of the certificate; importers for at least five years from importation, or longer if the law says so.
- Rule 23: a certificate is not required if the importing Party has waived it.
- Rule 24: exporters submit the Annexure-A information, keep documents for no less than five years from the end of the year of issue, and notify immediately if the certificate rests on incorrect information.
- Rule 25: where no claim was made at importation, the importer may claim the preference and a refund of excess duty, as a condition made not later than twelve months after importation or a longer period under the importing Party's law. An importer who finds incorrect information must correct the import document and pay duty and any penalties; a voluntary notification before discovery is a mitigating factor.
Verification, denial and other rules (rules 26 to 32)
Verification proceeds in sequence (rule 26): written requests to the importer; then to the exporting competent authority and issuing body; then to the exporter or producer, who must be given at least thirty days; then visits. Verification may be done at the time of the import declaration or before or after release, and goods are released against duty or security during verification, with refund if the good is found originating.
Under rule 27, the exporting issuing body replies within ninety days (extendable by up to sixty days where accuracy is suspected). A visit needs the exporter's written consent within thirty days; the exporter names two or more independent witnesses; and the process, including the written determination, is completed within six months of the visit. Rule 28 lists the grounds for denial, which include insufficient information, no response or no consent to a visit, and requires a reasoned determination to the exporter or producer. Rule 29 permits temporary suspension for persistent non-compliance with consultation through the Joint Technical Subcommittee. Rule 30 provides for duty and sanctions where non-compliance is found, rule 31 covers goods in transport or storage on the date the rules came into force, and rule 32 says minor errors do not by themselves lead to rejection if they raise no doubt about originating status.
A practical example
Southern Spice Mills exports a blended product to Australia. Annexure-B has no specific rule for the item, so rule 4 applies: every non-originating material must show a tariff sub-heading change, and QVC must reach the printed 35 per cent (build-up) or 45 per cent (build-down). The firm obtains its certificate before shipment, keeps its cost records for five years and answers an importer-side query within the time allowed.
Need help with Australia exports or imports?
Checking Annexure-B, choosing between the build-up and build-down methods and preparing cost break-ups for verification are separate tasks. Our IEC registration team can help you set up before you rely on an Australia preference. For comparison, see the India-UAE CEPA rules of origin and the India-Mauritius CECPA rules of origin.
Key takeaways
- Two routes to origin: wholly obtained, or non-originating materials meeting rule 4 or Annexure-B.
- Rule 4 default: CTSH plus QVC of at least 35 per cent (build-up) or 45 per cent (build-down).
- De minimis is 10 per cent by value, or by weight for Chapters 50 to 63 (rule 9).
- The certificate is valid for twelve months and is issued before or within five working days of export.
- Records are kept at least five years.
- A post-importation claim must be made within twelve months of importation.
Read next
- Rules of origin under the India-UAE CEPA
- Rules of origin under the India-Mauritius CECPA
- Rules 5-8 of the CAROTAR, 2020: verification and denial of preference
- How to get a certificate of origin in India
Disclaimer: Based on the Customs Tariff (Determination of Origin of Goods under the India-Australia Economic Cooperation and Trade Agreement) Rules, 2022 as published on the CBIC Tax Information Portal, as consulted on 3 October 2026. Later notifications, duty notifications and the Customs Tariff Act, 1975 should be checked. This article is general information, not legal advice; check the official text before acting.