Rule 9 - Fungible Materials - Customs Tariff (Determination of Origin of Goods under the Preferential Trade Agreement between the Governments of MERCOSUR Member States comprising the Argentine Republic, the Federative Republic of Brazil, the Republic of Paraguay and the Republica Oriental del Uruguay and the Republic of India) Rules, 2009

Rule 9. Fungible Materials: 1. For the purpose of establishing if a product is originating when in its manufacture are utilized originating and non-originating fungible materials, mixed or physically combined, the origin of such materials can be determined by any of the inventory management methods applicable in the Signatory Party. 2. Where considerable cost or material difficulties arise in keeping separate stocks of originating and nonoriginating materials which are identical and interchangeable, the customs authorities may, at the written request of those concerned, authorise the "accounting segregation" method to be used for managing such stocks. 3. This method must be able to ensure that the number of products obtained which could be considered as "originating" is the same as that which would have been obtained if there had been physical segregation of the stocks. 4. The customs authorities may grant such authorisation, subject to any conditions deemed appropriate. 5. This method is recorded and applied on the basis of the general accounting principles applicable in the country where the product was manufactured. 6. The beneficiary of this facilitation may issue or apply for proofs of origin, as the case may be, for the quantity of products which may be considered as originating. At the request of the customs authorities, the beneficiary shall provide a statement of how the quantities have been managed. 7. The customs authorities shall monitor the use made of the authorisation and may withdraw it at any time whenever the beneficiary makes improper use of the authorisation in any manner whatsoever or fails to fulfil any of the other conditions laid down in these Rules.