Thursday, 29 July 2021 16:27

EU – JP Preference Agreement

Written by saikiran b
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Source https://blogs.sap.com/2021/07/30/eu-jp-preference-agreement/
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This Blog tells you about how to implement preference processing between EU countries and Japan.

The EU-Japan Economic Partnership Agreement came into force on February 1, 2019. SAP Supports the following functions to enable use of JEFTA (Japan EU Free Trade Agreement) in SAP GTS Preference Management.

  1. Transaction Value method
  2. Tariff shift method
  3. Transaction value method RVC

SAP includes this functionality in SAP GTS 11.0 SP16 version. In order to implement this to the old version GTS system, go through SAP Notes : 2793346 – Japan-EU Free Trade Agreement (EPA) an implement all the OSS Notes mentioned in it. After implementing all the OSS Notes, kindly follow all the steps mentioned below.

Unlike the other EU agreements, Japan needs the following preference indicator as well along with the preference status, based on the product. Hence it will have it’s own Schema for Preference Indicators as shown below.

Pref. IndicatorDescriptionInternal Preference Statement
Not eligible40
AGoods wholly obtained or produced entirely66
BGoods entirely from originating materials63
C1Tariff shift60
C12Tariff shift, MaxNOM or RVC60
C123Tariff shift, MaxNOM or RVC, specific production process60
C123ETariff shift w. tolerance, MaxNOM or RVC, spec. prod. proc.60
C12ETariff shift with tolerance, MaxNOM or RVC60
C13Tariff shift, specific production process60
C13ETariff shift with tolerance, spec. production process60
C1ETariff shift with tolerance60
C2MaxNOM or RVC60
C23MaxNOM or RVC, specific production process60
C3Specific production process60
C4Application of provisions of section 3 of appendix 3-B-160
XEligible, without specifying origin criteria60

Steps to activate EU-JP Preference processing:

  • Define legal regulation for EU-JP Preference processing with Legal Code 06
  • Maintain all the preference indicators under EU-JP Scheme as shown in the above table and assign it to EU-JP Preference Agreement.
  • Run /SAPSLL/PRE_VDO_FILL_VDOWNVAL report in GTS. This report will add the entries with VALUE_TYPE ‘PREVAL’ in new table /SAPSLL/VDOWLVAL for all entries in /SAPSLL/VDOWL
  • As rules of origin data contains three methods for EU-JP Agreement, Assign price type to agreements for determination for all three methods shown below.
    1. 1 Transaction Value method
    2. 3 Tariff shift method
    3. 6 Transaction value method RVC

SPRO Path : SPRO -> Global Trade service -> Risk Management -> Preference Processing -> Assign price types to agreements for determination

  • Along with this, we need to Assign price type to agreements and Value base.

This is exclusive for EU-JP Preference agreement. After implementing all the OSS notes mentioned in 2793346 SAP Notes, we can assign it using /SAPSLL/V_TLBVAL View, which can be maintained in SM30

Make sure you Assigned proper values to all the 6 Value basis (Including the blank value)

  • After all the above setting in GTS, Go to Area Menu (/N/SAPSLL/MENU_LEGALR3) in feeder
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