Question 5 Notes – De Minimis:

De Minimis only applies to a good which has failed to qualify as originating under Question 4 (Product Specific Rules).

For example you wish to export milk to China under the FTA. Most of your milk originates from New Zealand but a proportion is sourced from a third party, or you cannot determine origin. The milk is all blended together.

The milk does not qualify using a CTC as there has been no change in heading. Inputs into the good “Milk” (HS Code 0401) must be referenced in another chapter (milk is not referenced in any other chapter).

If the FOB value of the milk is $25,000 and the CIF value of the non-originating milk is $1,200 you can apply the De Minimis test (using the RVC calculation, see question 4), if the RVC is equal to or greater than 90% the good qualifies. In this example:

RVC = 95.2% therefore the good qualifies for a Certificate of Origin under De Minimis (providing all other applicable criteria has been met).

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