Equivalent goods under inward processing
Instead of the imported goods you can use union goods when producing the processed goods. This must be stated in your authorisation for inward processing.
Equivalent goods are normally included in the same 8 digit KN number as the goods they replace. They should also have the same trade qualities and technical properties as these goods. There are some exceptions from these requirements. These include
- Goods at a more advanced stage of manufacture than the non-Union goods placed under the inward processing procedure where the essential part of the processing with regard to these equivalent goods is carried out in the undertaking of the holder of the authorisation or in the undertaking where the operation is being carried out on his behalf;
- In the case of repairs, new goods instead of used goods or goods in a better condition than the non-Union goods placed under the inward processing procedure; and goods with technical characteristics similar to the goods which they are replacing provided that they have the same eight-digit Combined Nomenclature code and the same commercial quality.
There are also special provisions for certain goods in Annex 71-04 of the Delegated Regulation.
Equivalent goods may not be permitted in any of the following cases:
- When only usual forms of handling according to the definition in Article 220 of the Union Customs Code is carried out within the framework of the inward processing procedure.
- Read more about usual forms of handling in Article 220 of the Union Customs Code.
- When a prohibition against the restitution of import duty or relief from customs duty applies to non-original goods used when obtaining the processed goods under inward processing and a certificate of origin has been issued or drafted for these goods.
- When this would confer unjustified benefits with regard to customs duty on import or when this is prescribed by Union legislation.
- When the equivalent goods to be placed under inward processing would be subject to a preliminary or final anti-dumping duty, countervailing duty, or penalty when entering into free circulation.
- Genetically modified goods or products, or goods or products containing genetically modified components.
Prior export
Prior export means that you are exporting processed goods obtained from equivalent goods before the import of the goods they are replacing. This must also be stated in your authorisation for inward processing. To be granted authorisation for prior export you need to ensure the correct execution of the procedure, in particular with regard to customs supervision.
Your authorisation for inward processing will state deadline for declaring non-Union goods under the procedure for inward processing when using prior export. The deadline must be within six months and is calculated from the date of receipt of the export declaration for processed products obtained from corresponding equivalent goods. Upon request from the holder of the authorisation the six month deadline may be extended after its expiry, provided that the total period does not exceed twelve months.
In the case of prior export of equivalent goods, information exchange for special procedures (INF) is required for importation of corresponding predicate goods.
More information about information exchange for special procedures.
Customs status of equivalent goods
When using equivalent goods under inward processing, the customs status of these goods will change from Union goods to non-Union goods at a specific point in time. Similarly, the customs status for the replaced goods are changed from non-Union goods to Union goods. The point in time when the customs status changes depends on the circumstances.
The typical case
Equivalent goods and processed goods obtained from those become non-Union goods at the point in time when they are released into the subsequent customs procedure and the inward processing procedure is completed, or at the point in time when the processed goods have exited the customs territory of the Union. The goods which they replace become Union goods at the same time.
Goods released on the market before the procedure is discharged
When goods under inward processing are released on the market before the inward processing procedure is discharged, their customs status changes at the point of time when they are released on the market.
Prior export
In the case of prior export of processed goods within the framework of inward processing, the equivalent goods and the processed products obtained from these become non-Union goods with retroactive effect at the time when they are released into the export procedure, if the goods to be imported are entered into that procedure. If the goods to be imported are entered into the inward processing procedure they become Union goods at the same time.
Last updated: