Outward Processing Relief
OPR explanation & creation
With the Outward Processing Relief (OPR), goods can be transported to third countries to be processed there. Additionally, it enables the (re-)import without a full tariff burden. Information, about what Inward Processing Relief is, how it works, etc., and also what Freightfinders can offer you, can be found in this article.
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Outward Processing Relief – Creating documents with Freightfinders
Freightfinders supports you with expertise and know-how on creating the OPR. Do not let bureaucracy come in your way of doing your business. We at Freightfinders and our partners will take care of creating your documents for an easy and smooth transport. Put your trust in our and our partners’ long-term experience!
What is Outward Processing Relief
The purposes of the Outward Processing Relief are usually lower labour costs, but also special know-how. Hence, the goods are being transported to third countries e.g. for processing or repairing. After the OPR, the goods can be reimported at lower import charges.
If goods are only being repaired, and if this happens, because of contractual/legal claim or because of previous production faults, and therefore are free of charge, there will be a complete relief of import charges.
If goods are being repaired in return for payment, there will be, depending on the exact processing, a partial exemption.
In general, during the clearance of goods which have gone through the process of Outward Processing Relief, it will be considered that the goods contain parts from the EU. Hence, the customs clearance is based on the processing costs. The process invoice can be used as proof for customs.
Outward Processing (Trade)
Outward Processing is similar to Outward Processing Relief. Here, goods are being transported to third countries for processing, as well. Still, Outward Processing relocates the work processes to third countries for valuable consideration and offers primary materials to produce new or improved goods. Meanwhile, the goods are still in the possession of the principal.
There is no Outward Processing, if the principal provides parts, which have an insignificant function or value, such as labels or screws. Moreover, plain measures, such as packing or ironing, are not part of Outward Processing.
Process of Outward Processing Relief
For an Outward Processing Relief, you will need a customs declaration and an authorisation. Test criteria for the authorisation are e.g. examination of economic requirements. Hence, it will be checked, for example, if there will be possible disadvantages for EU manufacturers, or if the execution of the Outward Processing Relief is, economically speaking, impossible in the EU.
The actual process of the OPR contains three phases. During first one, EU goods are being temporarily exported from the customs territory of the EU. In the second phase, the goods are being processed. Afterwards, the freight is being re-imported partially or fully tax- and duty-free.
Finally, the goods are released for free circulation, which lowers the tariff burden.