Country of origin: Overview, definition, and example
What is country of origin?
Country of origin refers to the country where a product was manufactured, produced, or substantially transformed before being sold or shipped. It’s used to determine where a good officially comes from for legal, regulatory, customs, and trade purposes.
In simple terms, it’s the answer to the question: “Where was this product made?”
Why is country of origin important?
The country of origin affects a wide range of business activities, including:
- Import/export duties and tariffs
- Labeling and packaging requirements
- Trade agreement eligibility (like NAFTA or USMCA)
- Consumer perception and marketing
- Customs compliance and border inspections
For SMBs that import or export goods, getting the country of origin right is essential. Errors or mislabeling can lead to fines, shipping delays, or even seizure of goods by customs authorities.
It also helps buyers and regulators know how a product was made, what laws applied, and whether any trade restrictions are involved.
Understanding country of origin through an example
Let’s say your company sells leather handbags. The raw materials come from Italy, but the bags are fully assembled and sewn in Vietnam. Even though the materials are Italian, the country of origin is Vietnam, because that’s where the product was substantially transformed into its final form.
When you export the bags to the U.S., you must label them as “Made in Vietnam.” If you incorrectly label them “Made in Italy,” customs could delay the shipment or impose penalties for misrepresentation.
An example of a country of origin clause
Here’s how a clause about country of origin might appear in a supply agreement:
“The Supplier shall accurately identify and label the Country of Origin for all goods delivered under this Agreement in accordance with applicable import and export regulations. The Supplier shall be responsible for any penalties, fines, or delays resulting from incorrect declarations.”
Conclusion
Country of origin is more than just a label—it’s a key piece of legal and regulatory information that affects shipping, pricing, compliance, and customer trust.
If your business is involved in manufacturing, importing, or exporting products, make sure you understand and accurately declare the country of origin. It keeps you compliant, avoids costly mistakes, and helps you navigate international trade with confidence.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.