Guide to the Generalized System of Preferences

Which Goods Qualify for Duty Free Import Under the GSP?

Each country with a GSP scheme will publish a list of eligible articles for duty-free import, which may vary from country to country. In the US, for example, there are around 3500 articles suitable for duty-free treatment from GSP beneficiaries, and a further 1500 articles are eligible for Least Developed Beneficiary Developing Countries (LDBCs).

Conditions of the Generalized System of Preferences

Each GSP system will have its conditions to determine eligible countries. Eligibility criteria are used to distinguish which countries fall into the developing country category and which level of GSP should be offered.
These conditions are likely to share many similarities. Examples of conditions of the Generalized System of Preferences may include:

• Tariff reductions will only apply to goods wholly grown, produced or manufactured within the beneficiary country
• For third-country goods to qualify for tariff reductions, they must have undergone significant transformation in the beneficiary country. Around 35% of the value of the product must be added.
• Goods must be imported directly from the GSP eligible country
• Eligible countries must not be communist
• Eligible countries should not participate in the worst forms of child labour

Documents Required for GSP Treatment

To receive GSP treatment, beneficiary countries are required to provide proof of eligibility, and this will include the GSP Declaration. You may also be asked to supply invoices, purchase orders, and production records.