What is a Rex Number? Your Guide to the Registered Exporter System

December 5, 2022
What is a Rex Number? Your Guide to the Registered Exporter System

If you import goods from the European Union you may already have come across REX, the system for registered exporters.

REX allows EU-based companies to self-certify the origin of their goods. And origin matters because it determines the duties that apply to any particular good.

REX therefore streamlines the export by allowing registered exporters to declare their products’ origin without expensive certification processes. It decreases the legwork needed for a buyer to receive exported goods – despite some early scepticism after its introduction on 1 January 2017.

But with so much legalese, jargon and convoluted terminology to navigate – ‘GSP beneficiary country’, ‘economic operators’, ‘OAD’, ‘origin form’ – it’s little wonder the REX system can seem unclear.

That’s where we can help. clearBorder, the leading independent trading consultancy and training service, has decades of combined experience helping companies improve their trading operations. The gains are significant: you can save time and resources, ensure compliance and scale your cross-border operations sustainably, without adding to risk.

This article is your one-stop guide to all things REX. In it, we’ll examine the system in more detail, explore the way it works and how it’s applied, and provide the information you need to know since the UK’s exit from the EU.

What is the REX System?

The REX system is a self-certification process whereby an exporter gains the ability to declare the origin of exported goods without the need for shipments to be independently verified.

In the words of the European Commission, REX is:

“A system of certification of origin of goods based on a principle of self-certification. The origin of goods is declared by economic operators themselves by means of so-called statements on origin. To be entitled to make out a statement on origin, an economic operator has to be registered in a database by his competent authorities.”

European Commission

Once the competent authorities register exporters within the REX database, that economic operator becomes known as a ‘registered exporter.’

The REX system is understood to mean the certification of origin system in a general sense, not only the behind-the-scenes IT system used to register exporters. At the time of writing the REX system is used by EU exporters in conjunction with:

  • Some FTAs (free trade agreements)
  • The GSP (General Scheme of Preferences) of the EU
  • The OAD (Overseas Association Decision).

What is an economic operator?

Both in a wider enterprise sense and as the term relates to REX system exporters, an ‘economic operator’ is defined as a business or organisation supplying goods or services within the context of market operations.

According to UK government guidance, “Authorised economic operator (‘AEO’)” status is an internationally recognised designation. It shows your business’s role in the international supply chain is secure and has customs control procedures that meet Authorised Economic Operator standards and criteria. AEO status is not a requirement under REX.

In public procurement, ‘economic operator’ is used to generally cover companies that operate as suppliers, contractors and service providers.

What are GSP beneficiary countries?

The EU’s GSP, or Generalised Scheme of Preferences, is a legislative concept that effectively removes import duties for goods and products which enter the EU market from “vulnerable developing countries.” By granting preferential tariff treatment in this way, the EU’s GSPs – and GSPs in general – aim to reduce poverty and create jobs based on “international values and principles.”

Generalised Schemes of Preferences can be broken into three categories: Standard GSP (pertaining to eleven countries), GSP+ (pertaining to eight), and EBA (Everything But Arms; pertaining to 46 nations). A full list of GSP beneficiary countries can be found on the European Commission website.

Aside from the EU, the following countries also grant their own version of a GSP:

  • Armenia
  • Australia
  • Belarus
  • Canada
  • Iceland
  • Japan
  • Kazakhstan
  • New Zealand
  • Norway
  • The Russian Federation
  • Switzerland
  • Turkey
  • The UK
  • The USA

How Does the REX IT System Work?

The REX IT system was developed by the European Commission and is available for use by member nations of the EU, GSP beneficiary countries and Overseas Countries and Territories (‘OCT’s’). It is a web-based application so all you need is an internet-enabled device.

REX IT splits into three main branches.

The registration of exporters

In order to obtain registered exporter status and receive a REX number, organisations must first apply. This can be done using the REX IT system via an application form, which must then be submitted to the relevant competent authorities.

The modification of exporter data

Having been certified as a registered exporter, an organisation is obliged to maintain its own relevant details. This would include communication of “all changes on his registered data.” The competent authorities then carry out the modifications within the REX system.

The revocation of exporter’s registration

In exceptional circumstances – for example, if a registered exporter commits fraud or ceases to exist – registered exporter status may be withdrawn. The specific context surrounding the revocation determines whether this is performed upon request or independently by the competent authorities.

It’s also worth knowing that the registered exporter’s data is kept, stored, and freely available to view on the registered exporter database. This allows economic operators to verify the authenticity of any REX number it chooses to investigate.

However, a registered exporter may decide that he would prefer “all his registered data” not to be published. In this case, the organisation’s REX number and date of validity/revocation are published regardless, as this is the minimum amount of information necessary to validate authenticity.

How is the Registered Exporter System Applied in the EU?

There are five stated scenarios under which the REX system is applied within the European Union. They are as follows:

  • EU organisations exporting originating goods to GSP beneficiary countries for “the purpose of bilateral cumulation of origin”
  • EU organisations exporting originating goods to OCTs for “the purpose of bilateral cumulation of origin”, or for the purpose of benefiting from preferential tariff treatment given by an OCT to the EU
  • EU organisations exporting originating goods to third countries with which the European Union has a free-trade agreement. At the time of writing, this includes:
    • The Agreement between the EU and Canada (CETA)
    • The Agreement between the EU and Japan
    • The Agreement between the EU and Vietnam
    • The Agreement between the EU and UK (EU-UK TCA)
    • The stepping stone EPA between the EU and Cote d’Ivoire
    • The stepping stone EPA between the EU and Ghana
    • The interim EPA between the EU and Eastern and Southern Africa (ESA)
  • EU re-consignors replacing or updating proofs of origin where there is re-consignment within the EU, or to Norway or Switzerland.

Application in the Context of OAD

The REX system has been applied to OCTs in the context of the OAD, or the Overseas Association Decision ([EU] 2021/1764), since 1 January 2020.

The OAD does not allow for a transition period for the application of a REX number by the OCTs. For this reason, tariff preference is given at the point of import into the European Union on goods originating in the OCT only upon the presentation of statements on origin made by a registered exporter. EUR.1 certificates of origin are no longer acceptable.

Application criteria

An OCT has to meet two criteria in order to make a successful application for a REX number. It must:

  • Submit an Undertaking to the European Commission providing for administrative cooperation within the REX infrastructure
  • Communicate the contact details of competent authorities dealing with the registration of exporters

Norway, Switzerland and Turkey have very similar rules to those listed above within their own GSPs, and therefore, the REX system is applicable in the GSPs of those countries.

Post-Brexit Updates: What You Need to Know

For the year following the UK’s departure from the EU (31 January 2020), HMRC permitted an easement for customs documentation. This meant that a statement of origin was unnecessary in order to claim a 0% (preferential) rate of duty for products imported from the EU. However, this period ended at the end of 2021, meaning EU suppliers now require a REX number.

This might affect your trading operation in the following ways:

  • Export invoices from the EU must show a statement of origin before a preferential duty rate can be claimed
  • If the total value of the shipment does not exceed €6,000, the statements on origin can be made by any exporter; if the shipment value exceeds €6,000, the EU exporter will need to have a REX number
  • If your organisation imports goods into the UK and your EU supplier does not provide a valid statement of origin, customs duty is due once the shipment enters the UK.
  • If you’re established in Northern Ireland and import goods under an EU preference that are not released for free circulation but are supplied to an EU country:
    • The REX system will allow you to issue statements of origin when the value of the consignment is over 6,000 euros.

Trade Seamlessly Across Borders

If you’d like further guidance on the REX system – or any of the other cross-border processes your organisation is involved in – you’re in the right place. clearBorder is committed to giving companies just like yours the knowledge to trade with confidence, with accessible training designed by industry experts and personalised consultancy services designed to grow your operations and ensure your compliance with all the relevant legislation.

Contact us now to discuss your operation, get your team border-ready, and begin trading seamlessly across borders.