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Brazil implements new MERCOSUR Regime of Origin

June 19th, 2024

Brazil has published Decrees No. 12,058/2024 and 12,059/2024 to implement the new MERCOSUR Regime of Origin, aimed at boosting trade within the bloc, thus ensuring best international practices and simplifying current regulations to speed up origin verification. 

The decrees were regulated within the scope of the MERCOSUR according to CMC Ruling No. 05/2023, which approved the new MERCOSUR Regime of Origin, and CMC Ruling No. 06/2023, which defined differentiated treatment of maximum amounts of non-originating materials in order to enforce origin requirements in Paraguay and Uruguay.

Among the main changes the new regime provides for are:

  • Reduction in local inputs requirement:

The new regime provides for a 5% increase in the limit of inputs imported from countries that are not MERCOSUR members to produce Brazilian products. As such, generally, the exported product is considered as originating from Brazil provided that it does not exceed the 45% limit of non-originating materials. Certain products, however, are specifically subject to different origin requirements.

While percentages enforced in Argentina are similar to those in Brazil, other countries follow different limits, such as Paraguay (60%) and Uruguay (50%).

  • Simplified proof of origin:

The new MERCOSUR Regime of Origin has adopted a hybrid system to prove origin. While the Certificate of Origin, provided for in the previous regime, remains valid as proof of origin, the new regime allows MERCOSUR countries to issue a self-declaration of origin filled out by an exporter or producer from the exporting member state.

The MERCOSUR origin regime is essential to prevent the levy of import taxes on products traded among within the bloc by establishing such the origin country of such products.

Demarest’s International Trade and Customs team is available to provide any further clarifications.