Direct Transport Rule

FTA / RoO

FTA requirement that goods be shipped directly between partner countries without manipulation in third countries.

Sources

1. CBIC — Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020 (CAROTAR), Notification No. 81/2020-Customs (N.T.) taxinformation.cbic.gov.in accessed 23 September 2026

CAROTAR turns this into a tick-box with consequences: rule 3(1)(d) requires the importer to indicate in the bill of entry “if goods have been transported directly from country of origin”. The substantive condition — what breaks direct transport, and what transhipment or storage is tolerated — comes from the agreement’s own Rules of Origin. CAROTAR requires the declaration; the agreement decides whether the facts satisfy it.

What CAROTAR does and does not settle. These rules govern how an importer into India claims and proves preferential origin. They do not define the substantive origin criteria — cumulation, value content, tariff shift, wholly obtained — which are set by each trade agreement’s own Rules of Origin. CAROTAR says so itself at rule 8(3): “In the event of a conflict between a provision of these rules and a provision of the Rules of Origin, the provision of the Rules of Origin shall prevail to the extent of the conflict.” So read the agreement for what qualifies, and CAROTAR for what India requires of the importer who claims it.

Related terms

• Absorption Principle
• Bilateral Cumulation
• Certificate of Origin
• Change in Tariff Classification
• Cumulation
• Diagonal Cumulation

From the AJG lexicon archive (July 2026).