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India–Chile tariff preferences: the margin available today and the origin you have to prove

What the Chile–India Partial Scope Agreement grants today, where the CEPA negotiation stands, and the origin checklist a preferential claim has to pass before it saves any money.

Legal & Institutional Affairs, Chile · Santiago, Chile · Mexico City

A quote that assumes goods move duty-free between India and Chile is usually wrong twice. The agreement in force covers a defined list of tariff lines at a reduced rate rather than a zero rate, and the comprehensive agreement that would change that is still being negotiated. Both errors land in the same place, on a landed-cost sheet that books a saving the shipment never receives.

Two agreements, one of them usable

The agreement in force is a Partial Scope Agreement, signed in New Delhi on March 8, 2006 and in force since August 17, 2007. An expansion was signed in September 2016 and entered into force on May 16, 2017. SUBREI’s agreement page publishes the annexes and states that the certification regime is certification by entity.

The Comprehensive Economic Partnership Agreement is a separate, future instrument. India and Chile signed terms of reference for it, held the third round in Santiago in October 2025, and concluded the fourth round in New Delhi in December 2025, reporting progress across the chapters under negotiation. Negotiating areas include goods, services, investment, rules of origin, intellectual property, technical barriers, sanitary and phytosanitary measures and critical minerals. In August 2026 India’s Commerce Secretary reviewed progress in Santiago, and both governments restated a target of concluding in 2026.

Concluding negotiations is not entry into force. A concluded text still goes through legal scrubbing, signature, domestic approval on both sides, and only then entry into force, usually followed by a staging schedule that phases duties down over years. Nothing in the CEPA belongs in a commercial case this year. Price the shipment on the Partial Scope Agreement, and treat the CEPA as a reason to keep your classification and origin file in order for when it arrives.

What a margin of preference is worth

The Partial Scope Agreement grants a margin of preference: a percentage cut off the normal duty on a listed line, not exemption from it. A 60% margin on a 6% duty leaves 2.4% payable.

The two administrations publish different counts of what is covered. SUBREI and Chilean Customs report 2,099 Indian products receiving Chilean preferences and 1,110 Chilean products receiving Indian preferences. India’s release on the expansion counts 1,798 Chilean tariff lines offered to India with margins of 30% to 100%, and 1,031 Indian lines offered to Chile at eight-digit level with margins of 10% to 100%.

Neither count is wrong. Each administration counts in its own tariff nomenclature. The practical consequence is that a summary figure tells you nothing about your product, and the only number that matters is the margin published against your own eight-digit line.

That arithmetic decides whether a claim is worth making at all. GTRI’s FTA Report Card 2026 estimates that only 20% to 30% of India’s eligible exports claim preferences, against 60% to 70% for goods moving into India, because origin compliance and certification often cost more than the duty saved. Run the margin against the certification cost before committing to the claim.

The origin checklist

Annex C of the agreement sets the rules below. Work through them in order, because a failure at any step voids the claim regardless of the others.

  1. Classify the good first, at eight digits in the importing country’s tariff. Every later step depends on the classification, and a claim built on the wrong line fails at the first review.
  2. Find your line on the other Party’s concession annex and read the margin against it. A line absent from the annex carries no preference at any margin.
  3. Identify which origin rule applies. A good wholly produced or obtained under Article 4 qualifies on that basis. Where Annex C1 sets a product-specific rule, that rule governs. Otherwise the general rule applies.
  4. Apply the general rule of Article 5. The total value of non-originating and undetermined-origin materials must not exceed 60% of the FOB value of the finished product, the final process of manufacture must take place in the exporting Party, and the finished product must be classified under a four-digit Harmonized System heading different from every non-originating material used in it. Both the value test and the heading change have to pass.
  5. Value the non-originating materials the way Article 5(3) requires: the CIF value at the time of importation where that can be proven, otherwise the earliest ascertained price paid for them in the territory where the processing took place. Materials of undetermined origin take the earliest ascertained price and count against the same 60% ceiling.
  6. Use cumulation where it helps. Under Article 3, goods originating in one Party and used as an input in the other are treated as originating there. Indian content in a Chilean product, and Chilean content in an Indian product, stop counting against the ceiling.
  7. Check the process is not on the insufficient list. Article 6 rules out preserving operations, dilution, simple sorting, washing, painting, husking, slicing and cutting, changes of packaging, simple packing, affixing labels and logos, simple cleaning, simple assembly or disassembly under General Rule 2(a), and slaughter of animals. These never confer origin even when the value test passes.
  8. Keep the goods within the direct transport rule. Goods must move directly between the Parties. Transit through a third country is allowed only under customs surveillance, justified by geography or transport requirements, without entering trade or use in the transit country, with no operation beyond unloading, reloading and preservation, for a period not exceeding six months, and with the customs endorsements to prove it.

The certificate has rules of its own

Origin can be satisfied and the claim still fail on the paperwork. Section III of Annex C2 governs the certificate.

  • The certificate is issued by a government office of each Party, or by an office or representative corporate entity to which that authority has been delegated, and is issued in English. Exporters do not self-certify.
  • It is issued within five working days of the application and is valid for one year from the date of issue.
  • It cannot predate the commercial invoice. It may be issued on the invoice date or within the sixty days following it.
  • One certificate covers one import operation, though that operation may include several goods.
  • The description of the goods on the certificate must correspond to the tariff classification and to the description on the commercial invoice. A certificate that describes the goods differently from the invoice is the most common avoidable failure.
  • The application rests on a sworn declaration from the final producer covering the company name and address, the description and tariff classification of the goods, the FOB value, the originating materials, the non-originating materials with their exporting country, classification to at least six digits, CIF value in US dollars and percentage of the finished product’s value, and a description of the manufacturing process.
  • Where a product is exported regularly and neither its manufacturing process nor its materials have changed, that producer’s declaration can stand for up to one year, so the cost falls on the first shipment and later ones reuse the same declaration.
  • If a certificate is stolen, lost or destroyed, the issuing authority can provide a certified copy marked “COPIA AUTENTICA” in box 4, carrying the date of the original.
  • A certificate presented after its validity has expired is accepted only where the delay is due to force majeure or other valid reasons beyond the exporter’s control.

Chile and India run a common digital platform for issuing certificates under this agreement, with Chile the first Indian partner country to use it.

Keep the file that survives verification

The importing customs authority can ask the importer for information about the origin of the goods, and where that is insufficient, ask the issuing authority directly. The evidence behind the claim has to still exist when that question arrives, months after the shipment cleared.

Hold the bill of materials with each input’s origin and classification, the supplier declarations behind the originating inputs, the costing that produced the FOB value and the non-originating percentage, the manufacturing process description, the certificate and the invoice it matches, and the transport documents proving direct shipment. Without that file, the preference is a duty you pay later.

Sources

Next step

If you are pricing a shipment between India and Chile and the preference changes the decision, discuss the sourcing or verification case. Bring the product specification, the tariff classification you intend to use and the bill of materials with input origins, so the claim can be tested before the purchase order rather than after the goods arrive.

Insights contain general business information and do not constitute legal, tax, customs, regulatory or technical advice.