Latest news with #Non-PreferentialCertificatesofOrigin
The Star
06-05-2025
- Business
- The Star
Support for Miti as issuer of certs
Ministry's decision will reinforce Malaysia's export credibility, say groups PETALING JAYA: The appointment of the Investment, Trade and Industry Ministry (Miti) as the sole issuer of Non-Preferential Certificates of Origin (NPCO) has received broad support from business chambers and trade groups, who say the measure will help protect Malaysia's trade integrity, particularly with the United States. However, industry leaders caution that the possibility of poor execution, lack of preparedness and insufficient infrastructure could result in bottlenecks and delays, potentially disrupting shipments and hurting exporters nationwide. The Malaysian International Chamber of Commerce and Industry (MICCI) said the government's decision to centralise the issuance of the certificates will reinforce Malaysia's export credibility and protect legitimate trade flows, particularly to the United States. ALSO READ: Experts: Move will address issue of transhipment 'Exporters are advised to stay updated on the revised application procedures and to engage closely with the ministry to ensure full compliance with the new requirements,' MICCI president Christina Tee said. To support compliance and reduce the risk of transhipment-related offences, MICCI is urging exporters to maintain clear, comprehensive and transparent supply chain records. 'Businesses must declare origin of products accurately and avoid any practices that could be perceived as relabelling or misrepresentation,' she added. ALSO READ: Miti to be sole issuer of certificates of origin for US-bound shipments She also encouraged companies to take part in awareness and capacity-building programmes organised by Miti and the Royal Malaysian Customs Department, and to cooperate fully during verification and audit exercises. However, Tee acknowledged that recent tariff measures imposed by the United States could present challenges by increasing operational costs and reducing competitiveness in the US market. 'To remain resilient, MICCI encourages its members to diversify their markets, invest in value-added strategies and enhance their product offerings. 'At the same time, businesses must maintain full compliance with all trade regulations.' Tee said MICCI supports the government's continued engagement with US counterparts to address these concerns and to promote a fair, open and rules-based trading environment. Previously, NPCOs for US-bound exports were issued by business councils, chambers or associations appointed by Miti. These trade documents verify the origin of goods for international shipments, though they are not used to claim preferential tariff rates. Tee said the chamber is prepared to forgo earnings from issuing NPCOs in the interest of national priorities. 'MICCI is willing to let go of that revenue and support Miti in issuing NPCOs so that the nation can emerge stronger during this period,' she said. Tee added that while NPCOs are a source of income, US-bound exports make up only about 15% of MICCI's certification activities. She was responding to the announcement by Miti on Monday that the ministry would serve as the sole issuer of NPCOs for US shipments effective yesterday. The ministry cautioned that any attempt to circumvent tariffs – including making false or misleading declarations of value or origin – will be treated as a serious offence. Malaysia Consortium of Mid-Tier Companies (MCMTC) honorary president Callum Chen raised concerns over Miti's preparedness to handle the new system. He said the absence of a dedicated facility and trained personnel could result in delays, as exporters now have only one access point instead of several. 'Does Miti have enough space and officers? How long will verification take, and how will exporters outside the Klang Valley be accommodated?' he asked. Chen stressed the need for a comprehensive nationwide solution. 'It's not just about space – it's about managing crowds, traffic, parking and logistics,' he said. 'Execution is key, even with a good plan,' he said, highlighting concerns from exporters in Johor, Penang, Sabah and Sarawak. The Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) also called for a smoother transition as Miti takes over full responsibility on the issuance of the certificates. Its treasurer-general Datuk Koong Lin Loong proposed that the chambers assist by reviewing and verifying applications before Miti's final approval to help reduce the ministry's workload and ensure efficiency. 'We support the centralisation, but caution against implementing it too abruptly. Many exporters have yet to secure their certificates and a sudden change could lead to disruptions,' he said. Similarly, SME Association of Malaysia president Chin Chee Seong said Miti's ability to manage the transition effectively will depend on robust digital integration and timely support. He urged continued collaboration with industry associations to ensure accessibility and a better understanding of businesses' backgrounds. 'With every export requiring a certificate, this change impacts every transaction. There must be a clear, efficient process to avoid delays. The success of this transition will become clearer in the weeks ahead,' he said.
Straits Times
05-05-2025
- Business
- Straits Times
Malaysia clamps down on transshipment practices to the US, to prevent goods rerouting by other countries.
The Malaysian government views any attempt to circumvent tariffs through wrong or false declaration as "a serious offence". PHOTO: AFP SINGAPORE - Malaysia is imposing stricter rules to ensure exports to the United States are properly documented, in a bid to curb the transshipment of products that do not originate in Malaysia. The move comes amid growing scrutiny from US authorities over countries, such as China, which seek to sidestep American tariffs by routing its exports via another country to disguise their true origin. This practice, known as transshipment, has become a focal point in ongoing trade enforcement efforts by US customs officials since the Trump administration unveiled its so-called Liberation Day Tariffs on April 2. Malaysia's Trade and Industry Ministry (MITI) announced on May 5 that with effect from May 6 , it will be the only body that will issue Non-Preferential Certificates of Origin (NPCO) for shipment to the US , while stopping the issuance of these certificates from MITI-appointed organisations like local business councils, chambers or associations. The NPCO is a document that helps to identify the origin of the goods for international shipments in order to satisfy customs or trade requirements of the countries the products are shipped to, the Federation of Malaysian Manufacturers said on its website. The government's new measure aims to eliminate loopholes that could enable the misuse of Malaysia as a conduit for goods seeking to bypass tariffs imposed by US trade regulations. Malaysia's trade ministry said in its statement that 'it is unequivocally committed to upholding the integrity of international trade practices.'. 'As such, the government views any attempt to circumvent tariff through wrong or false declaration, whether related to the value or origin of goods, as a serious offence,' it added. Malaysia faces a 24 per cent reciprocal tariff on its exports to the US, which is expected to come into force in July. In the May 5 statement, MITI said it will also take additional measures to curb any transshipment offences to the US via Malaysia's entry or exit points. This includes enhancing audits on NPCO applicants, and working together with the Customs Department to investigate and take action against offenders. According to industry sources whom ST spoke to, some Chinese manufacturers have used Malaysia as a transshipment hub, allegedly going as far as falsifying their Certificates of Origin, in an effort to bypass the US tariffs. An industry veteran, who requested anonymity due to the sensitivity of the issue, revealed that in some cases, the perpetrators pay as little as RM1 00 (S$30.60) to obtain fraudulent certificates of origin for containers bound for the US. Addressing the matter in Parliament on May 5, Investment, Trade and Industry Minister, Tengku Zafrul Aziz, said: 'For countries with no Free Trade Agreements with Malaysia, like the US, we have a NPCO which is issued by business chambers, but due to this (transshipment) issue, MITI will take over the issuance of these certificates.' He added that Malaysia has 'received many complaints from industry partners that say that many items coming from other countries are stamped as if they come from our country.' Mr Zafrul, who visited the US in late April to meet with trade officials, also suggested forming a parliamentary caucus involving both pro-government and opposition MPs to debate on next steps to be taken by the government in handling the issue. Malaysia's Prime Minister Anwar Ibrahim , who officiated a special parliamentary session on the US tariffs on May 5, said that 11 per cent of Malaysia's total trade is with the US, with the value of bilateral trade in 2024 amounting to RM325 billion. Supporting the MITI move , the Associated Chinese Chambers of Commerce and Industry of Malaysia said in a statement on May 5 that the country's tariff advantage has encouraged businesses to reroute shipments and misclassify products to evade higher export tariffs. 'This could distort trade data and lead to the dumping of foreign goods, threatening local MSMEs already facing tight margins,' it added, referring to micro, small and medium enterprises . Harith Mustaffa is a journalist covering Malaysia for The Straits Times, with a focus on Johor. Additional reporting by Lu Wei Hoong. Join ST's Telegram channel and get the latest breaking news delivered to you.
The Star
05-05-2025
- Business
- The Star
Tengku Zafrul: Malaysia opposes breach of international trading system to circumvent tariffs
Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Aziz KUALA LUMPUR: Malaysia strongly opposes any breach of the international trading system, including the issuance of fake or misleading certificates of origin, in an effort to circumvent tariffs. Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Aziz said that his ministry (MITI) takes note of media reports that say exporters from China are trying to circumvent United States (US) tariff by "origin washing' products by re-routing through third-party countries such as Malaysia. "Starting tomorrow (May 6), we will no longer permit chambers of commerce to issue Non-Preferential Certificates of Origin (NPCO) as there are many complaints from the industry that a lot of goods from elsewhere come to our country (for circumventing tariff). "NPCO for shipments to the US that are often issued by chambers of commerce will not be allowed and applications for NPCO that involve the US will be centralised under MITI,' he added. Tengku Zafrul was speaking during the winding up session at the special parliamentary meeting at the Dewan Rakyat today where Prime Minister Datuk Seri Anwar Ibrahim gave an explanation on the government's preparation to cushion the impact of US reciprocal tariffs on imports from Malaysia. - Bernama
The Sun
05-05-2025
- Business
- The Sun
Malaysia opposes breach of international trading system to circumvent tariffs
KUALA LUMPUR: Malaysia strongly opposes any breach of the international trading system, including the issuance of fake or misleading certificates of origin, in an effort to circumvent tariffs. Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Aziz said that his ministry (MITI) takes note of media reports that say exporters from China are trying to circumvent United States (US) tariff by 'origin washing' products by re-routing through third-party countries such as Malaysia. 'Starting tomorrow (May 6), we will no longer permit chambers of commerce to issue Non-Preferential Certificates of Origin (NPCO) as there are many complaints from the industry that a lot of goods from elsewhere come to our country (for circumventing tariff). 'NPCO for shipments to the US that are often issued by chambers of commerce will not be allowed and applications for NPCO that involve the US will be centralised under MITI,' he added. Tengku Zafrul was speaking during the winding up session at the special parliamentary meeting at the Dewan Rakyat today where Prime Minister Datuk Seri Anwar Ibrahim gave an explanation on the government's preparation to cushion the impact of US reciprocal tariffs on imports from Malaysia.
Malay Mail
05-05-2025
- Business
- Malay Mail
Airfreight carriers urge action over China goods routed through Malaysia to dodge US tariffs
KUALA LUMPUR, May 5 — The Airfreight Forwarders Association of Malaysia (AFAM) is calling for stricter oversight after reports surfaced of Chinese goods being rerouted through Malaysia to evade US tariffs. The group said it had urged the Ministry of Investment, Trade and Industry to step in and ensure rigorous checks on certificates verifying the origin of goods. AFAM highlighted that some brokers in China are marketing these services online, potentially encouraging illegal relabelling of products. 'These actions, if true, are highly unethical and risk seriously undermining Malaysia's international trade reputation. 'They may also jeopardize Malaysia's standing as a trusted and responsible trade partner in the global supply chain,' it said in a statement. The association said it has issued a strong advisory to local importers and exporters against engaging in any form of origin fraud. AFAM also affirmed its support for the Malaysian government's diplomatic efforts to handle US trade tensions and protect the country's standing. Earlier today, Minister of Investment, Trade and Industry Datuk Seri Tengku Zafrul Abdul Aziz said his ministry will become the sole issuer of Non-Preferential Certificates of Origin (NPCO) for all exports to the US from tomorrow over this issue.
