Using Preference Determination in the Export Process

After completing this lesson, you will be able to:

After completing this lesson, you will be able to:

  • Perform preference determination in SAP GTS

Preference Determination in SAP GTS

Whenever you perform preference determination for a product in SAP GTS, the system checks the preferential agreements to determine if, and under which conditions, this product can be sold as an originating product of the exporting country or — in the case of the EU — country group. These checks can only be performed for products that have a BOM. In SAP GTS, you can also carry out preference determination for configurable materials.

The system stores the preference determination result in the product master. If there are value clauses, it applies the minimum ex-works price established during preference determination. If the change of heading or specific production procedures have been checked successfully, the system applies the smallest possible numerical value field.

Preference Indicator

Once preference determination has been completed successfully, the SAP GTS system sets a corresponding preference indicator in the product for which preference determination was performed.

If the comparison of the preference determination result with the actual ex-works price reveals that the actual ex-works price is too low to claim preferential origin status for the goods being exported, you can use the preference determination details to check for which non-originating materials, if any, it is worth requesting a supplier’s declaration. If vendors or manufacturers confirm that their products have preferential origin status, the total value of non-originating materials will be lower in future preference determinations and the minimum ex-works price of the final product being exported will be reduced as a consequence.

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