Information on the PEM Convention
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The PEM Convention (Regional Convention on pan-Euro-Mediterranean preferential rules of origin) sets out common rules of origin for goods under numerous free trade agreements between countries in Europe and the Mediterranean region.
The rules determine whether a product qualifies as originating goods and can therefore benefit from preferential tariff treatment, such as reduced customs duties or duty-free importation.
The PEM Convention applies to rules of origin in most free trade agreements to which Iceland is a party with countries in Europe and the Mediterranean region. The rules provide a common framework that ensures the consistent application of rules of origin among the contracting parties.
Preferential tariff treatment and proofs of origin issued under the old rules
Proofs of origin issued before 1 January 2026 under the old rules in agreements within Zone 1, without the endorsement “REVISED RULES”, may still confer entitlement to preferential tariff treatment, provided that:
the goods were in transit or placed in customs warehousing during the 2025/2026 year-end period, and
the proofs are submitted within their validity period.
Zone 2 – agreements without an active link
Under the free trade agreements in Zone 2, the old PEM rules continue to apply. In these cases, accumulation is limited to products and production processes originating in other agreements within the same zone. Accumulation between Zone 1 and Zone 2 is generally not permitted.
EUR.1 movement certificates and origin declarations
To benefit from preferential tariff treatment under free trade agreements based on the PEM Convention, recognised proof of origin must be provided. Such proof may take the form of a movement certificate or an origin declaration, depending on the requirements of the relevant agreement and shipment.
The most common proof of origin under the PEM Convention is the EUR.1 movement certificate. It is also permitted to use an origin declaration on an invoice or other commercial document, provided that the applicable authorisation and value limit requirements are met.
From 1 January 2026, origin declarations are no longer required to include the endorsement “REVISED RULES”.