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What is a Rex in Business?

Published in Trade Certification System 4 mins read

In the context of business, particularly international trade, REX refers to the Registered Exporter System. This system plays a crucial role in simplifying and streamlining the process of proving the preferential origin of goods for businesses engaged in global commerce.

Understanding the REX System

The REX system is an electronic registration system designed to manage and facilitate the certification of origin for products in international trade. It is primarily used within the framework of preferential trade agreements where certain goods can benefit from reduced or zero tariffs upon import, provided they originate from a partner country.

Instead of requiring traditional certificates of origin issued by third parties, the REX system empowers exporters to self-certify the origin of their goods. This shifts the responsibility from governmental bodies or chambers of commerce directly to the exporters and producers themselves, who must be registered in the system.

How Does the REX System Work?

The REX system operates on the principle of self-certification of origin, offering a modern approach to international trade compliance.

  • Registration Requirement: To participate in preferential trade, exporters and producers must register within the Registered Exporter System. This registration process ensures that the entity is recognized and authorized to issue origin declarations.
  • Self-Certification of Origin: Once registered, businesses are entitled to self-certify the preferential origin of their products. This means they can declare the originating status of their goods themselves, rather than relying on external bodies to provide proof.
  • Preferential Origin Documents: The self-certification is typically done by making out a specific preferential origin document. Common examples of such documents include a "statement on origin" or an "origin declaration," which are endorsed directly by the registered exporter on commercial documents like invoices.
  • Facilitating Trade: By enabling self-certification, the REX system helps to reduce administrative burdens and costs associated with trade, making it easier for businesses to claim preferential tariff treatment for their exports.

Key Benefits for Businesses

Implementing and utilizing the REX system offers several advantages for businesses involved in international trade:

  • Streamlined Origin Certification: It simplifies the process of proving the origin of goods, moving away from more cumbersome traditional methods.
  • Access to Preferential Tariffs: Registered exporters can easily demonstrate that their products meet the rules of origin, allowing their importers to claim reduced or zero tariffs, making their goods more competitive in target markets.
  • Reduced Administrative Burden: The ability to self-certify eliminates the need to obtain physical certificates of origin from third-party authorities for each shipment, saving time and resources.
  • Enhanced Trade Flow: By accelerating the origin certification process, the REX system contributes to faster customs clearance and more efficient international trade flows.

Who Needs to Register for REX?

Generally, any exporter or producer who wishes to self-certify the preferential origin of their products under a trade agreement that utilizes the REX system must register. This applies to businesses exporting goods to countries where the REX system is implemented as the method for proving preferential origin.

REX System Overview

Aspect Description
Full Name Registered Exporter System (REX System)
Purpose Enables self-certification of preferential origin for goods in international trade.
Who Uses It Exporters and producers who export goods under preferential trade agreements.
Key Output Preferential origin documents, such as statements on origin or origin declarations, made out by the exporter.
Primary Benefit Access to preferential tariffs for importers, reduced administrative costs and simplified procedures for exporters, and streamlined trade.
Context Used in various free trade agreements and generalized system of preferences (GSP) schemes.

For more detailed information on the REX system and its application in specific trade agreements, businesses can refer to official trade resources provided by relevant customs and trade authorities, such as the European Commission's Access2Markets portal.