Customs & Trade
SAFTA Rules of Origin
Executive Summary
The SAFTA Rules of Origin (Annex IV of the SAFTA Agreement) establish the criteria for products to qualify for preferential tariff treatment within the South Asian Free Trade Area. The general rule requires either: (a) 35% domestic value content (or 30% for LDC members including Bangladesh, with additional 5% concession), OR (b) the product falls under product-specific rules (PSR) list which specifies the required change in tariff classification or processing operation. Cumulation is allowed among SAARC member states. To claim preference, the exporter must obtain a Certificate of Origin (Form SAFTA) issued by the designated competent authority (in Bangladesh: EPB for most products, BFIDA for fisheries). The certificate must be presented to customs at the time of import declaration. Direct consignment rule applies (transhipment through non-SAFTA countries permitted under specific conditions). For Bangladesh exporters, SAFTA preference is most beneficial for exports to India (which is by far the largest SAARC market), with the average tariff preference being 5-15 percentage points.
Key Points
- Annex IV of the SAFTA Agreement
- General rule: 35% domestic value content (30% for LDCs including Bangladesh, +5% concession)
- Alternative: Product-Specific Rules (PSR) list
- Cumulation allowed among SAARC members
- Certificate of Origin: Form SAFTA (issued by EPB)
- Form SAFTA presented at destination customs
- Direct consignment rule (transhipment permitted with conditions)
- Bangladesh competent authorities: EPB (most products), BFIDA (fisheries)
- Largest benefit: exports to India
- Average tariff preference: 5-15 percentage points
- SAARC members: Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, Sri Lanka
Full Details
SAARC Free Trade Area (SAFTA) rules of origin as per Annex IV of the SAFTA Agreement. Detailed criteria for preferential tariff treatment among SAARC member countries.