Mapping Preferential Agreements

Preferential agreements can be mapped individually as legal regulations. Like legal regulations for other application areas, these legal regulations can be created manually in Customizing (SAP Global Trade Services, edition for SAP HANA→General Settings→Legal Regulations→Define Legal Regulation).

Some data providers sell complete lists of working and processing contained in protocols on rules of origin in the form of XML files. The upload of these files also creates legal regulations for the agreements of which these protocols form part.

If the rules of origin are unique to an agreement, the individual mapping in the form of a legal regulation is the only option.

Preferential agreements with identical rules of origin can be grouped into a single legal regulation. This applies, for example, to the agreements within the PEM area. The legal regulation thus represents an area of preference.

After the update of all bilateral protocols on rules of origin in the PEM area with a reference to the Regional Convention as last amended, legal regulations for the affected individual preferential agreements or for the PEM area of preference are obsolete and can be deactivated.

In the video Cumulation of Origin, you will learn more about the main motive for harmonizing and simplifying the rules of origin within the PEM area.

Unlike the preferential agreements of the EU, the United States-Mexico-Canada Agreement (USMCA) does not limit the description of products to chapters, headings or subheadings of the Harmonized System (HS). Some of the rules of origin use eight-digit codes referred to as tariff items to specify the products that might qualify as originating in either of the signatories.

These items are part of the national customs tariff numbers or, as in the case of Mexico, are identical with the national customs tariff numbers. If rules of origin referring to tariff items are to be maintained in Customizing or if the complete rule set is to be uploaded to SAP GTS from XML files, the USMCA has to be mapped in the form of three legal regulations.

This split is necessary because the assignment of a numbering scheme to a rule set is unique, as is the assignment of a rule set to a legal regulation (SAP Global Trade Services, edition for SAP HANA→Preference Management→Define Rule Set and →Assign Preference Agreement to Rule Set respectively).

You will learn more about rule sets for the USMCA in the lesson Mapping Rules of Origin.