International Trade, Customs Compliance and Export Control Framework

Determining and Documenting Country of Origin

Country of origin is determined through the internationally recognised 'Rules of Origin' framework, which establishes criteria for when goods acquire the origin of the country in which they are manufactured or processed. Numerous countries and trading blocks maintain bilateral and multilateral trade agreements, including Free Trade Agreements, Customs Unions, and Preferential Trading Arrangements that provide preferential duty rates and trade benefits for goods of qualifying origin. Accurate origin determination and documentation is essential for Nord Gas Solutions to: (i) utilise preferential trade benefits on behalf of our customers; (ii) comply with customer contractual requirements specifying origin preferences; (iii) demonstrate regulatory compliance; and (iv) maintain audit trail documentation for customs authorities.

Where goods are manufactured and substantially processed within the European Union, or within countries with which the EU maintains trade agreements, Nord Gas Solutions strongly prefers that suppliers obtain and document preferential origin status. Preferential origin status provides tariff benefits to Nord Gas Solutions' customers globally when they import these products into their respective territories, reducing total cost of ownership and improving competitive positioning. Suppliers are encouraged to structure supply chains to maximise origin qualification where commercially practicable.

Due to the complex global distribution of raw materials and components, Nord Gas Solutions requires all suppliers to identify country of origin using official ISO country codes. Generic, regional, or unspecified codes including 'EU', 'RoW' (Rest of World), or codes such as QQ, QR, QS, QU, QV, QW, QX, QY, QZ are not acceptable and will result in order rejection or return of goods. Suppliers must maintain detailed supply chain mapping to enable precise country-of-origin designation for all materials and components.

Origin Documentation Requirements and Standards

All commercial documentation, including invoices, delivery notes, packing lists, and bills of lading, must include complete customs and trade compliance information at the item line level. This includes country of origin (ISO code), HS/commodity code (six-digit minimum), ECN/ECCN export control classification (for dual-use and controlled items), and preferential origin statement where applicable. Documentation must be complete, accurate, and consistent across all shipping documents to enable customs clearance and trade agreement compliance.

Supplier Compliance Assurance Process: Three-Phase Methodology for European Union Based Vendors

The European Commission provides standardised procedures for supplier origin declarations under Regulation (EU) 2015/2447. EU-based suppliers may issue long-term supplier declarations (Form A or equivalent) that remain valid for all deliveries of specified materials during the stated validity period, typically two years. Long-term declarations provide operational efficiency and reduce administrative burden compared to single-consignment procedures.

Where the origin of supplied goods varies between deliveries (e.g., due to sourcing multiple suppliers or changing manufacturing locations), suppliers are required to provide single-consignment origin declarations with each delivery. Single-consignment declarations must specifically identify the goods, origin, and preferential status claimed for that shipment and must be accurate and traceable to underlying production records.

Single-consignment origin declarations may be incorporated directly into commercial documents including invoices, delivery notes, or packing lists, provided they contain all mandatory information and comply with EU and national customs requirements. However, declarations embedded in commercial documents must be clearly distinguished and readily identifiable by customs authorities.

Nord Gas Solutions prefers that suppliers segregate preferential and non-preferential materials on separate origin declarations using the appropriate EU-prescribed templates. This segregation facilitates customs processing, reduces error risk, and demonstrates procedural compliance. Mixing preferential and non-preferential goods on a single declaration is permissible only where explicitly authorised by applicable customs regulations.

Supplier Compliance Assurance Process: Three-Phase Methodology for Non-European Union Based Vendors

All non-EU suppliers must include complete origin and export control information on all commercial documents accompanying shipments, including invoices, delivery notes, packing lists, and bills of lading.

1. For suppliers in countries maintaining trade agreements with the EU (such as FTAs, Association Agreements, or Stabilisation Agreements):

Where suppliers are established in countries with EU trade agreements and where supplied goods qualify for preferential origin status, suppliers must clearly state the preferential origin claim on all commercial documents. Suppliers must identify their customs authorisation status (Registered Exporter, Approved Exporter, or equivalent) and provide the relevant customs authorisation number. Non-preferential claims must also be explicitly stated where goods do not qualify for preferential treatment.

2. For suppliers in countries without EU trade agreements:

Where no trade agreement exists, suppliers must nevertheless provide complete customs and trade information including country of origin (ISO code), HS tariff classification, ECCN/ECN export control classification (where applicable), and any relevant regulatory compliance note. This information must appear on all commercial documents to enable customs clearance and ensure Nord Gas Solutions can accurately declare goods to customs authorities.

Harmonized System Tariff Classification Standards

Fundamentals of Tariff Classification

Every product traded internationally receives a Harmonized System (HS) commodity code that encodes information including:

• applicable import and export duties, tariffs, levies, and other fiscal charges

• applicable trade defense measures including anti-dumping duties, countervailing duties, and safeguard measures

• trade flow statistics for national accounts and international trade negotiations

• import and export formalities, licensing requirements, and product-specific regulatory requirements or restrictions

• standardized product descriptions and classification criteria applied consistently across all jurisdictions

Correct classification is the key for smooth customs clearance processes across the world, ensuring compliance by paying the correct amount of import VAT and duties.

The Harmonized System: International Trade Classification Framework

• The Harmonized System: International Trade Classification Framework (HS) is an internationally standardised system of names and numbers to classify traded products, maintained by the World Customs Organization.

• The WCO publishes explicit General Rules of Interpretation and product-specific classification notes that govern HS code assignment for every category of commercial product.

• HS codes function as a universal classification language, enabling customs authorities, traders, and international organisations to communicate product information consistently regardless of national language or local terminology. HS codes are encoded numerically to enable automated processing, cross-border data exchange, and international regulatory compliance.

Export Control Classification and International Sanctions Compliance

Nord Gas Solutions is unequivocally committed to full compliance with all applicable export control regimes, international sanctions frameworks, and non-proliferation initiatives. Nord Gas Solutions actively supports international efforts to prevent the development, acquisition, and proliferation of weapons of mass destruction (chemical, biological, radiological, and nuclear) and their delivery systems. Nord Gas Solutions also supports international counter-terrorism financing initiatives and sanctions measures administered by the United Nations, European Union, United States, and other relevant authorities. Suppliers must align their operations with these commitments and are contractually prohibited from supplying goods or services to sanctioned entities or jurisdictions.

Export control systems are legally binding mechanisms employed by nations and international organisations to regulate the cross-border transfer of goods, technology, software, and services deemed sensitive from national security, counter-proliferation, or foreign policy perspectives. Export control restrictions may affect Nord Gas Solutions' ability to supply certain products to certain destinations or customers and may require advance licensing or approvals from governmental authorities.

International sanctions are policy instruments administered by national governments and international organisations (including the United Nations, European Union, United States, and other bodies) to advance foreign policy, security, and humanitarian objectives. These sanctions may restrict or prohibit commercial dealings with specified countries, entities, individuals, or sectors. Nord Gas Solutions and all employees, contractors, and suppliers are legally required to comply with all applicable sanctions’ regimes.

For further information on customs and trade compliance requirements, please contact your Nord Gas Solutions representative.