The Council of the European Union has received a proposal for a Council Decision to conclude the Comprehensive Economic Partnership Agreement between the EU and Indonesia, including Annex 3 on product-specific rules of origin. The document, published on 29 June 2026, sets out the technical criteria that determine whether a product qualifies for preferential tariff treatment under the agreement.
change in tariff classification, specific production processes, or a maximum value or weight of non-originating materials. The rules are referenced to the Harmonised System as amended on 1 January 2022. Alternative rules are separated by "or", while cumulative requirements are joined by "and". Key definitions include "CC" (change at the two-digit level), "CTH" (change at the four-digit level), and "CTSH" (change at the six-digit level).
For textiles, a tolerance of 10% by weight of non-originating basic textile materials is allowed, with higher tolerances for polyurethane yarn (20%) and aluminium foil strip (30%). Agricultural products in Chapters 6, 7, 8, 9, 10, 12, and heading 24.01 that are grown or harvested in a Party are treated as originating even if grown from imported seeds or plants. For Chapters 1 to 10, products must be wholly obtained or produced from non-originating materials of any heading.
The proposal now awaits consideration by the Council. Once adopted, the agreement will enter into force after ratification by both parties, providing EU and Indonesian exporters with preferential access to each other's markets. The rules of origin are a critical component for businesses to claim tariff reductions, impacting sectors such as textiles, agriculture, and manufacturing. EU producers will need to ensure their supply chains comply with the origin criteria to benefit from the agreement, while Indonesian exporters will gain easier access to the EU market. The European Parliament will also need to give its consent before the Council can formally adopt the decision.