1. Why this category gets its own treatment
Electronics and machinery are where China’s export volume is largest, and where the origin rules interact most awkwardly with the way the products are actually made.
2. The manufacturing pattern
Components sourced from several countries.
Assembly in China.
Some products undergo substantial transformation. Others are assembled from parts that already carry the finished product’s classification.
3. The default rule and where it fails
The common default is a change in tariff classification.
For machinery, components often fall in different headings from the finished machine, and the rule is met easily.
For some electronic products, the components sit in the same heading as the finished goods, and the tariff change rule fails.
4. The value content route
Where the tariff change test fails, a regional value content test may apply.
The calculation needs the value of originating and non-originating materials, which most exporters do not track by default.
5. The product-specific rules that differ
Machinery
Generally heading-based, favourable to assembly.
Consumer electronics
More often value-based, or a combination.
Components and parts
Treated differently from the finished article.
6. The cumulation question
Under RCEP, components from any of the fifteen parties are originating.
Under the bilateral agreements, only components from the two parties are.
A component sourced from Japan therefore behaves differently depending on the agreement claimed.
7. A scenario
A manufacturer assembled monitors, using panels from Korea, control boards from Japan, and housings from China.
Under a bilateral agreement with Australia, the Japanese and Korean panels were non-originating, and the value test failed.
Under RCEP, both were originating and the goods qualified.
The same product, the same factory, two different answers.
8. What to record
The HS code and value of each component.
The supplier declaration for each imported component.
The origin test performed, against the specific rule.
The agreement under which the test was performed.
9. Closing view
For electronics and machinery, the tariff change rule is usually easy and the value rule is usually hard.
Knowing which one applies to your product determines how much data you need to keep.
*This article is based on the product-specific rules of China’s free trade agreements and RCEP.*