Managing Supplier's Declarations

In a supplier's declaration, vendors or manufacturers make a statement about the preferential origin of their goods in accordance with the wording prescribed in Annexes 22-15 and 22-16 to Commission Implementing Regulation (EU) No. 2015/2447 (Implementing Act for the UCC). The requesting exporter primarily uses this declaration as a previous document when issuing proofs of origin such as movement certificate EUR.1 or invoice declaration.

As a rule, the supplier's declarations are used in intra-Union trade only. However, the supplier’s declarations for goods without preferential origin are possible in trade with certain third countries. In addition, there is a special supplier’s declaration for goods with preferential origin in trade between Turkey and the Member States.

A supplier's declaration is generally valid for one specific consignment of goods. Regulation (EU) No. 2015/2447 also provides the long-term supplier's declarations, however. The long-term supplier's declarations are valid for up to two years from the date of issue. They are always an alternative to the consignment-based supplier’s declarations in cases where the originating status of the goods delivered is not expected to change during the validity period of the declaration. If the originating status of specific goods does change during the validity period of the long-term supplier's declaration, the buyer must be notified of this change immediately.

In SAP GTS, you can request, issue, and manage the long-term supplier's declarations for goods with preferential origin. The system helps you to select the customers and vendors to be contacted by generating proposals that contain extracts from purchasing documents and material documents for goods receipt postings or, as the case may be, billing documents from the feeder system. However, requests for, or issues of the supplier’s declarations, do not have to reference a specific document.

In SAP GTS, the request for the inbound long-term supplier's declarations relies on system proposals based on purchase orders and material documents for goods receipt postings in the feeder system. However, it is always possible to create a request manually using the Manage Requests - Long-Term Supplier’s Declarations app.

If the supplier’s declarations are usually to be requested based on system proposals, you can either use the Creation of LTSD Requests transaction (transaction code /SAPSLL/LTSDREQ_1) or schedule program /SAPSLL/CREATE_LTSD_REQUESTS for background processing. This program can send the automatically created requests directly to their recipients.

All requests are sorted according to their send status in an overview in the Manage Requests - Long-Term Supplier’s Declarations app. After executing the selection, you can still edit the ready-to-send requests before sending them. For example, you can adjust the validity period proposed by the system for the supplier’s declaration to be requested and delete or add products from the request. The system also informs you of the source of the product proposal (purchasing document number and/or material document number in the feeder system) and lists all relevant preferential agreements. If the sending of a request failed, you can post-process it or resend it directly.

As an alternative or as an enhancement to the program /SAPSLL/CREATE_LTSD_REQUESTS, you can use the Annual Creation of LTSD Requests transaction (transaction code /SAPSLL/LTSD_REQ_2) or schedule program /SAPSLL/CREATE_ANNUAL_LTSD_REQ for background processing. If you have already entered the supplier’s declarations in SAP GTS in the previous year, you can use this program to request a new supplier’s declaration for the following year, or years, without system proposals based on feeder system documents.

Once you have received the supplier’s declarations, you enter them in the Manage Requests - Long-Term Supplier’s Declarations app as documents of origin with reference to the respective request or independently of a request.

The suppliers’ statements entered in the SAP GTS system have to be aggregated on the product master level for the purpose of preference determination and the issue of the supplier’s declarations to customers. SAP GTS aggregates the statements based on the worst-case principle. For example, if there is a source of supply in a third country, the system categorizes all products received from this source as non-originating although there may be additional sources of supply inside the EU.

Not every vendor located in the EU is actually relevant for requesting the supplier’s declarations. In the Manage Preference Properties - Suppliers app, you can therefore control the request relevance at business partner level. All third-country suppliers are flagged as not relevant for requests (cannot be changed).

In Customizing for Preference Management, you define for each administrative unit whether all vendors located in the EU are included in the request runs or whether individual marking is required. However, you can exclude individual business partners from the request in the Manage Preference Properties - Suppliers app. If the indicator is not set, you have to flag each request-relevant EU supplier individually in the app.

When issuing the long-term supplier's declarations to customers, SAP GTS primarily uses the results of preference determination for your products. When you resell purchased goods, the system uses the aggregated supplier's statements in the product master instead.

SAP GTS proposes the issue of a supplier’s declarations based on billing data from the feeder system. For each product produced in-house, the system compares the net price of the billing items with the threshold value of the product according to preference determination. You can only submit a supplier's declaration for products having preferential origin status if the net price of the products was equal or superior to the threshold value in the entire analysis period.

If you have resold purchased products to the requesting customers, SAP GTS checks the preference status of the products. If the aggregation of the suppliers’ statements and the goods receipt data has shown that a product is originating in the EU, you can issue a supplier's declaration for this product in SAP GTS.

You can use the LTSD Issue transaction (transaction code /SAPSLL/LTSDOUT_1) to have the system create the supplier’s declarations based on billing documents from the feeder system. You can schedule program /SAPSLL/CREATE_LTSD_OUTBOUND for the automatic creation of the supplier’s declarations based on these system proposals instead.

You can display, change, and send the outbound supplier’s declarations in the Manage Long-Term Supplier’s Declarations - Outbound app. In this app, you can also manually add products to an existing supplier’s declarations and even create the supplier’s declarations without billing the document reference. This procedure is primarily suitable for new customers or products that your customers have not yet purchased from you, but in which they are interested. The purchase decision may depend on the preferential status of the product.

As for vendors, you maintain basic information on your customers for the purpose of a supplier’s declaration management in a specific app (Manage Preference Properties - Customer). All third-country customers are flagged as not relevant for the issue of the supplier’s declarations (cannot be changed). If a customer is the recipient of the goods but not of the supplier’s declaration, you can assign another business partner as the recipient of the declaration.

To ensure that the supplier’s declarations are revoked or reissued promptly if necessary, you should schedule the program /SAPSLL/PROCESS_RIR_TRIGGERS (Creation of Reissue Reasons) regularly for background processing. This program checks whether the statements of your supplier’s declarations are still valid. This check not only reveals that products have lost their originating status, but also identifies a change for the better.

The Manage Reissue Reasons - Long-Term Supplier’s Declarations app lists all the supplier’s declarations relevant for reissue in an overview. In the Initial Reissue Reason column, you can see which situation has led to a change:

• Preference determination (A current preference determination has increased or decreased the threshold value)

• Invoice (The threshold value was exceeded or fallen short of in a new billing document)

• Aggregation (Supplier’s declarations and goods receipts from third countries have been aggregated anew)

• Manual change (A user has changed the preference statement in the product)

After checking, and if necessary, changing the system proposals, you can send the new supplier’s declarations directly to their recipients. If you do not want to process a reissue proposal at first, you can put it on hold. However, you can also complete it without sending a new supplier’s declaration.