Customs and Origin

The Pan-Euro-Mediterranean (PEM) system and the PEM Convention

The pan-European cumulation system was created in 1997 on the basis of the EEA agreement (1994) between the EFTA countries, the EU (EC at that time), the CEEC (Central Eastern European Countries) and the Baltic States. It was then widened to Slovenia and to industrial products originating in Turkey (1999).The system was also enlarged to the Faroe Islands.

In 2005, it was enlarged to the participants in the Barcelona Process resulting in the creation of a pan-Euro-Mediterranean cumulation system of origin.

The initiative of creating a single PEM Convention, as an instrument promoting regional integration, was endorsed by the Euro-Mediterranean Trade Ministers during their meeting in Lisbon on 21 October 2007. It includes the above mentioned partners and the Western Balkans participating in the EU's Stabilisation and Association Process.

In some of EFTA’s free trade agreements with Contracting Parties to the PEM Convention the provisions concerning rules of origin and mutual administrative cooperation are the same as in the PEM Convention.

For more information see also the EU Commission’s homepage on PEM.

The revised rules of origin of the PEM convention in EFTA’s free trade agreements

The EFTA States are supporting the ongoing revision process of the PEM Convention aiming at introducing more flexible rules of origin in several sectors. The longstanding revision process has resulted in more liberal rules to which most of the contracting parties to the PEM Convention are ready to agree upon. However, the revised PEM Convention has not yet been adopted by consensus in the PEM Joint Committee.

The revised rules are more trade-friendly, better adapted to the needs of EFTA’s economic operators and align better with the rules of origin in EFTA’s most recent free trade agreements. To allow economic operators to benefit from the more flexible rules as soon as possible, EFTA has launched bilateral processes to incorporate the revised rules of the PEM Convention with interested PEM partners. For free trade partners for whom the revised rules have entered into force, economic operators may:

• claim preferential treatment base on the revised rules, or
• apply the current rules of the PEM Convention.

The table below lays out the status of these processes for EFTA’s PEM partners. Trade in industrial products including fish and processed agricultural products is covered by the main agreements, which applies to all EFTA States while trade in basic agricultural products is covered by bilateral agricultural agreements between each EFTA State and the partner country. 

EIF = entry into force

PEM Manual 

Making Rules of Origin Work for Lebanese Businesses

The Regional Convention on Pan-Euro-Mediterranean Preferential Rules of Origin (PEM Convention): What It Is and How It Works for Products of Lebanese Priority Sectors

A Real-Life Manual

Hannes Schloemann, WTI Advisors

This manual has been commissioned and funded by the EFTA States as part of EFTA technical assistance to the Republic of Lebanon. It is one of the results of a project which also included a series of sectoral workshops, other events and some advisory contributions.

This manual remains the product of advisors and none of its content can be directly or indirectly attributed to EFTA, the EFTA States or the Republic of Lebanon or their institutions. While the manual is meant to help producers, exporters and importers, they can and should seek additional advice from the relevant customs authorities whenever any doubts remain. It is the customs authorities that will be able to make decisions in individual cases.

In English HERE / In Arabic HERE. 

Value limits for origin purposes

The following value limits expressed in the national currencies of the EFTA States are applicable from 1 January 2023 to 31 December 2023:

Links to EFTA States' websites for customs