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-Sri Lanka rules of origin decide which goods from Sri Lanka and India qualify for preferential concessions under the bilateral trade agreement. They were made by Notification No. 19/2000-Customs (N.T.) dated 1 March 2000 and came into force on the date of their publication in the Official Gazette. This article explains the fourteen rules: the claim at importation, the origin criteria, the printed percentages, cumulation, direct consignment and the certificate of origin.
The official title of the rules is Customs Tariff (Determination of origin of goods under the agreement between the Democratic Socialistic Republic of Sri Lanka and the Republic of India) Rules, 2000. The official name contains one further descriptive word before "agreement" that this article leaves out, and refers to the set as the India-Sri Lanka trade agreement rules.
This article reads the rules as amended up to Notification No. 19/2000-Customs (N.T.) dated 1 March 2000, the notification that made them (CBIC text; no amendment found in CBIC's 2023-2026 lists). Later notifications should be checked before you rely on the current text.
Products are eligible for preferential concessions if they are wholly produced or obtained in the exporting contracting party (rule 6) or, if not, the value of non-originating materials does not exceed 65 per cent of the FOB value and the final process of manufacture is in the exporting party (rule 7). For cumulation, value addition in the exporting party must be at least 25 per cent of FOB value, with an aggregate of at least 35 per cent across both parties (rule 8). The importer must claim origin at the time of importation (rule 4).
What the rules are and how they apply
The rules are made under section 5(1) of the Customs Tariff Act, 1975. Rule 2 applies them to goods consigned from the territory of either contracting party. Rule 3 says no product is deemed the produce or manufacture of either country unless the conditions are met to the satisfaction of the appropriate authority. The rules print no tariff concession or duty rate; rule 4's explanation refers to the exemption notification of 1 March 2000 for the preferential treatment.
Rules 1 to 14 are followed by a form of certificate of origin with notes. The legacy bilateral rules sit beside the regional rules; see our overview of the SAFTA rules of origin for the regional scheme. On the Indian import side, preferential claims follow the customs procedure described in our articles on Rules 1 to 4 of the CAROTAR and Rules 5 to 8 of the CAROTAR. If you are about to export, our IEC registration service can help you with the code you need first.
Rule 4: the claim at the time of importation
The importer must, at the time of importation, (a) make a claim that the products are the produce or manufacture of the country from which they are imported and are eligible for preferential treatment under the agreement, and (b) produce the evidence specified in the rules. The rules print no late-claim procedure, so the claim should be ready when the goods are entered.
Origin criteria (rules 5 to 8)
Rule 5: originating products
Products covered by the agreement and consigned directly within the meaning of rule 9 are eligible for preferential concessions if they are wholly produced or obtained in the exporting party (rule 6), or not wholly produced or obtained but eligible under rule 7 or rule 8.
Rule 6: wholly produced or obtained
These include raw or mineral products, including mineral fuels, lubricants and ores, from the soil, water or seabed; vegetable products including agricultural and forestry products harvested there; animals born and raised there and their products; products of hunting or fishing; sea-fishing products from the high seas by the party's vessels and goods made on board its factory ships from them; used articles collected there fit only for recovery of raw materials; waste and scrap from manufacturing there; products from the seabed outside territorial waters where the party has exclusive exploitation rights; and goods produced exclusively from these. The Explanation defines "vessels", with equity conditions of at least sixty per cent owned by citizens or the Government of the party, or seventy five per cent by citizens and governments of the contracting parties.
Rule 7: not wholly produced or obtained
- Rule 7(a): products are eligible if the total value of materials, parts or produce from countries other than the contracting parties, or of undetermined origin, does not exceed sixty five per cent of the FOB value and the final process of manufacture is performed in the exporting party.
- Rule 7(b): non-originating materials are sufficiently worked or processed when the product is classified in a heading at the four-digit level of the Harmonised System different from those of all the non-originating materials.
- Rule 7(c): it is not necessary to establish whether power and fuel, plant and equipment, and machines and tools used originate in third countries.
- Rule 7(d): insufficient operations, whether or not the heading changes, include preservation, simple removal of dust, sifting, sorting, washing, painting and cutting up, changes of packing, simple slicing and repacking, affixing marks and labels, simple mixing, simple assembly, slaughter and any combination.
- Rule 7(e): the value of non-originating materials is the CIF value at importation where it can be proven, or the earliest ascertainable price for materials of undetermined origin.
Rule 8: cumulative rules of origin
For a product that complies with the origin requirements in rule 5(b), is exported by a contracting party and uses material, parts or products originating in the other party, the value addition in the exporting party must be not less than twenty five per cent of the FOB value, and the aggregate value addition in both parties not less than thirty five per cent of FOB value. The Explanation says only goods that have acquired originating status in one party may be counted as inputs for a finished product in the other.
| Test | Rule | As printed |
|---|---|---|
| Wholly produced or obtained | 6 | Closed list |
| Value limit | 7(a) | Non-originating and undetermined-origin materials not above 65 per cent of FOB value |
| Tariff change | 7(b) | Four-digit heading different from all non-originating materials |
| Cumulation | 8 | Value addition in the exporting party at least 25 per cent; aggregate in both parties at least 35 per cent |
Consignment, packing and the certificate (rules 9 to 11)
Rule 9, direct consignment: goods are directly consigned if transported without passing through any third country, or through intermediate countries with or without transshipment or temporary storage if the transit is justified for geographical reasons or transport requirements, the goods have not entered trade or consumption there and have undergone only unloading, reloading or operations to keep them in good condition.
Rule 10, packing: packing is considered as forming a whole with the product it contains, but may be treated separately if national legislation requires.
Rule 11, certificates of origin: products eligible for preferential treatment are supported by a certificate of origin in the form annexed, issued by an authority designated by the government of the exporting country and notified to the other, in accordance with certification procedures to be devised and approved by both parties. The rules themselves print no validity period, time limit for issue or verification timetable. The form's notes ask the exporter to enter in Box 8 a code for the criterion met: the letter for wholly obtained products, a letter followed by the percentage of non-originating content as a share of FOB value for rule 7 products, and another letter followed by the aggregate originating content for rule 8 products. Our guide on how to get a certificate of origin in India covers the Indian issuing side.
Prohibitions, cooperation and review (rules 12 to 14)
Rule 12: either country may prohibit importation of products containing inputs originating from states with which it has no economic and commercial relations. Rule 13: the parties co-operate to specify the origin of inputs in the certificate, take measures against circumvention through false declaration or falsified documents, co-operate in joint plant visits and consult on request. Rule 14: the rules may be reviewed on the request of either party and modified as agreed.
A practical example
Palm Grove Exports Pvt Ltd sends a manufactured good to Sri Lanka. Third-country materials make up 58 per cent of the FOB price and the good is classified in a different four-digit heading from each of those materials. The 65 per cent limit in rule 7(a) and the heading change in rule 7(b) are both met, and the final process is performed in India. The importer in Sri Lanka claims origin at the time of importation under rule 4 and produces the certificate of origin in the annexed form.
Need help with Sri Lanka trade?
Checking the 65 per cent limit against your cost sheet, entering the right code in Box 8 and making the claim at the time of importation are steps that benefit from planning. Our IEC registration team can help you get set up before you rely on a Sri Lanka preference. For related rules, see the SAFTA rules of origin and the India-Afghanistan preferential trade agreement rules of origin.
Key takeaways
- The importer claims origin at the time of importation and produces evidence (rule 4).
- Two routes: wholly produced or obtained (rule 6), or the 65 per cent limit plus a four-digit heading change (rule 7).
- Cumulation needs 25 per cent value addition in the exporting party and 35 per cent aggregate (rule 8).
- Direct consignment is required (rule 9).
- The rules print no validity period or verification timetable for the certificate.
Read next
- Rules of origin under SAFTA
- Rules of origin under the India-Afghanistan preferential trade agreement
- Rules of origin under the India-Singapore CECA
- How to get a certificate of origin in India
Disclaimer: Based on the Customs Tariff (Determination of origin of goods under the agreement between the Democratic Socialistic Republic of Sri Lanka and the Republic of India) Rules, 2000 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.