A shipment falls 2% short on RVC, or a single minor input fails the tariff-classification change — must the business give up preferential tariffs? Not necessarily. Free trade agreements provide “safety nets” for near-miss cases: the de minimis rule (tolerance for inputs failing the CTC criterion) and cumulation of origin (leveraging originating inputs from another member state). But each safety net has its own limits — misusing them is worse than not using them at all.
What is de minimis?
De minimis is a tolerance rule: a small proportion of non-originating inputs that fail the change-in-tariff-classification (CTC) criterion may be disregarded, so the goods still qualify as originating. The most commonly misstated technical point: de minimis only “rescues” the CTC criterion — it cannot compensate for a shortfall in RVC.
De minimis thresholds by FTA — there is no common threshold
Read this warning before the table: never assume “every FTA allows 10% of FOB value”. Each agreement has its own threshold and conditions (the de minimis rule under ACFTA has not been verified against the original instrument and is therefore excluded).
| FTA | De minimis threshold | Notes |
|---|---|---|
| ATIGA | Value of all non-originating inputs failing the CTC criterion not exceeding 10% of the FOB value | Article 9, Appendix I, Circular 22/2016/TT-BCT (via 29/VBHN-BCT 2024); filing guidance in Circulars 10/2022/TT-BCT and 19/2020/TT-BCT |
| AJCEP | Value of non-originating inputs failing the CTC criterion not exceeding 10% of FOB value; textiles (Chapters 50–63): weight not exceeding 10% of total goods weight | Article 9, Circular 37/2022/TT-BCT |
| RCEP | 10% of FOB value (HS Chapters 01–97); textiles (Chapters 50–63): weight of non-originating inputs failing CTC not exceeding 10% of total product weight | Applies only to goods whose origin is determined under the CTC criterion in the Product-Specific Rules (Appendix I, Circular 05/2022/TT-BCT) — not applicable to the RVC criterion (Article 10, Circular 05/2022/TT-BCT) |
| EVFTA | 10%: (i) 10% of ex-works price or net weight of non-originating inputs — products of Chapters 2 and 4–24 (except processed fishery products of Chapter 16); (ii) 10% of ex-works price — other products (except Chapters 50–63) | Must also not exceed the maximum percentages in Appendix II and does not apply to wholly obtained goods (Protocol 1 to the EVFTA) |
| CPTPP (textiles) | 10% by weight of the finished textile product for inputs failing the tariff-classification change | Per the Ministry of Industry and Trade |
Cumulation of origin: leveraging another member state’s inputs
While de minimis forgives non-qualifying inputs, cumulation works in the opposite direction: inputs already originating in one member state and used in production in another member state are treated as originating in the country of final production — making it easier for goods to meet the origin criterion.
ATIGA: full and partial cumulation
Under Article 6 of Appendix I to Circular 22/2016/TT-BCT, ATIGA provides two forms:
- Full cumulation: originating inputs of one member state used in production in another member state are treated as originating in the country of final production. Tick “Accumulation” in Box 13 of the Form D C/O.
- Partial cumulation: inputs with RVC from 20% to below 40% are cumulated at their actual rate — enter “PC x%” (x = actual RVC rate, e.g. “PC 25%”) in Box 8; condition: at least 20% of the goods’ RVC must originate in the member state where production/processing takes place. Tick “Partial Accumulation” in Box 13. This is a mechanism specific to ATIGA — not every FTA has it.
(Clauses 1 and 2, Article 6, Appendix I, Circular 22/2016/TT-BCT; Appendix VI to Circular 22/2016/TT-BCT; Circular 10/2022/TT-BCT.)
RCEP: cumulation and extended cumulation
Under Article 7 of Circular 05/2022/TT-BCT: inputs originating in one member state and used in production in the exporting country are treated as originating in the exporting country.
Extended cumulation (inputs from a non-RCEP country that shares an FTA with member states) applies only where member states agree on the mechanism, procedures and inputs — actual application has not been verified, so it must not be presented as an automatic right of businesses.
CPTPP (textiles): full cumulation
For textiles, the CPTPP applies full cumulation: if the entire production process (fibre → yarn → fabric → garment) takes place in one or more CPTPP member states, the final textile product is treated as originating regardless of the origin of intermediate inputs (per the Ministry of Industry and Trade).
Box 13 on the Form D C/O
When applying these rules under a Form D, tick Box 13 accordingly: “De Minimis”, “Accumulation” or “Partial Accumulation” (filing guidance in Circulars 10/2022/TT-BCT and 19/2020/TT-BCT).
Limits: simple processing and the 20% floor
Two limits apply to both de minimis and cumulation:
- Simple processing or working does not confer origin — even when several simple operations are combined (Article 11, Circular 37/2022/TT-BCT for AJCEP; corresponding provisions in ASEAN FTAs — Article 10, Appendix I, Circular 22/2016/TT-BCT).
- Inputs with RVC below 20% cannot be partially cumulated under ATIGA.
Common risks and recommendations
- Generalising “10% de minimis for every FTA”: each agreement has its own threshold, calculation basis (value vs weight) and scope.
- Using de minimis to offset an RVC shortfall: de minimis applies only to the CTC criterion (RCEP expressly excludes the RVC criterion).
- Treating partial cumulation as a general rule: it is specific to ATIGA.
- Treating RCEP extended cumulation as automatic: it depends on member states agreeing the mechanism.
- Extrapolating ATIGA/AJCEP rules to the UKVFTA without checking the instrument.
Frequently asked questions
Inputs failing CTC account for 12% of FOB value — does ATIGA de minimis apply?
No. The ATIGA de minimis threshold is not exceeding 10% of the FOB value of all non-originating inputs failing the CTC criterion.
Can an input with 15% RVC be partially cumulated?
No. ATIGA partial cumulation requires inputs with RVC from 20% to below 40%.
Does de minimis apply where goods use the RVC criterion?
No. De minimis only tolerates inputs failing the CTC criterion; RCEP expressly states it does not apply to the RVC criterion.
Legal bases
Circular 22/2016/TT-BCT (Articles 6, 9 and 10 of Appendix I; Appendix VI) — cited via Consolidated Document 29/VBHN-BCT 2024; Circular 19/2020/TT-BCT; Circular 10/2022/TT-BCT; Circular 37/2022/TT-BCT (Articles 9, 11); Circular 05/2022/TT-BCT (Articles 7, 10); Circular 11/2020/TT-BCT; Protocol 1 to the EVFTA; Decree 31/2018/ND-CP. Checked 14 October 2026.
The information in this article is for reference only and does not constitute legal advice. Rules of origin under each trade agreement may change; businesses should check the current legal instruments or consult a lawyer before applying them.
See also: Contact FLAT Law Firm
For reference only, not legal advice. Content quality-checked by the AI Legal Council; not yet reviewed by a human lawyer.
