Pan-Euro-Mediterranean (PEM): Change at the start of 2025

At the turn of the year 2024/2025, far-reaching changes are planned in the area of origin of goods and preferences. These require adaptations of the AEB Origin & Preferences software as well as the cooperation of those responsible in the companies that use this software.

The changes affect companies in the EU and Switzerland that use AEB software. Companies in the UK are not affected.  The rules will not be changed for countries outside the PEM zone, such as South Korea, Mexico, Japan, and Canada.

This article is the central location for all currently known and forthcoming specialist information, instructions, and calls to action.


What are PEM and the Regional Convention?

What will change?

When will the change come into force?

Effects on the AEB software and your processes

Which preparations do you need to take?

Technical information and instructions

Subscribe now and stay up to date.

What are PEM and the Regional Convention?

The Pan-European Mediterranean zone of origin (short: Pan-Euro-Med or PEM zone) is a group of countries that have concluded numerous bilateral free trade agreements with each other since 2005, using the same rules of origin and thus creating the basis for the Pan-Euro-Mediterranean cumulation.

It turned out to be difficult to amend a large number of agreements at the same time. The aim was not to jeopardize the system of identical rules of origin. For this reason, the rules of origin were combined into a separate set of rules in 2013 – the so-called Regional Convention. From then on, the free trade agreements referred only to the rules of the Regional Convention for the origin protocol, which sets out the rules for the preferential origin of goods. In order to change the rules of origin, the change only needs to be made in the Regional Convention and no longer needs to be implemented in all bilateral preferential agreements.

The contracting parties have agreed on such a change to the rules of origin from January 1, 2025. The Pan-Euro-Med matrix describes which countries from the PEM zone have concluded agreements with each other and are therefore allowed to cumulate. The application of the Regional Convention is indicated by a date with the suffix "(C)". The change in the rules from January 1, 2025 is marked with an "(R)".

Not all free trade agreements have yet been converted to the Regional Convention. It is to be expected that free trade agreements will continue to switch to the new rules beyond January 1, 2025 and that information will be published on how to proceed until then.

What will change?

Viewed in isolation, the new rules are easier to comply with. The main long-term simplifications coming into force are the following:

• Increase in general tolerance from 10% to 15%
• Changes to the content and structure of the list rules, in particular through:
  • Increase in the proportion of permitted non-originating materials depending on the ex-works price; ergo higher percentage
  • Reduction of combination rules
  • Introduction of weight rules
  • Simplifications for the textile and chemical sectors through special procedures, additional textual rules that may apply
  • Many header rules are summarized in the chapter rules; i.e. omission of many ex-rules for HS heading or HS sub-heading
• Movement certificate EUR-MED and declaration of origin on the invoice EUR-MED are no longer required

As a result of these changes, existing rule assignments must be dissolved and rules reassigned. Accordingly, the calculations and assessments must be carried out again.

When will the rule change come into force?

The rule change will enter into force on January 1, 2025 as Revised Rules to the Regional Convention. As of this date, the new rules apply to the agreements marked with "(R)" in the matrix.

In addition, on December 12, 2024, the Joint Committee of the Regional Convention decided to extend the existing rules of the Regional Convention in addition to other transitional provisions. This means that the previous rules can be used for a further year, provided that the parties to the agreement ratify these transitional provisions.

Effects on the AEB software and your processes

• As soon as the widget is made available with the service pack, all data imports and exports from and to O&P are interrupted and only executed again after the widget has been completed.

EU location:

German Customs provides information on the current status in ATLAS-Info 0697/25. The following countries only apply the revised rules of the regional convention:

• Albania
• Montenegro

For the EU jurisdiction, the widget for the changeover for these agreements was delivered at the turn of the year.

Bosnia-Herzegovina and Serbia have also ratified the transitional provisions and will therefore not be converted in the AEB software for the time being.

Switzerland location:

In a notification dated December 30, 2024, the Federal Office for Customs and Border Security (FOCBS) informed that the following agreements have been ratified by Switzerland and that the previous rules will continue to apply for the time being:

• CH – EU
• EFTA Convention:
  • Bosnia-Herzegovina
  • Georgia
  • North Macedonia
  • Serbia
  • Turkey

These conditions will not be met for the EFTA - Albania and EFTA - Montenegro agreements, so the revised rules of the Regional Convention will have to be applied.

For the Swiss jurisdiction, the widget for Albania and Montenegro will therefore be rolled out for the changeover at the turn of the year.

AEB continues to monitor the situation for Switzerland and the EU and possible short-term ratifications and announcements for both locations. The January 2, 2025 service pack includes the necessary adjustments and a bugfix. You will be guided through all the necessary steps via a widget.

For the software operated in the cloud, the service pack will be installed automatically. If you are running Origin & Preferences as an on-premises installation, you will need to install the service pack yourself.

Which preparations do you need to take?

• Continue to follow the information in this article.
• Allocate sufficient specialist resources for the turn of the year 2024/2025, e.g. for rule assignment and, if necessary, the creation of manual list rules. For a direct comparison of the old and new rules, you can find help in the article PEM rules 2025: Comparing new and old list rules.
• The changeover via the new widget must be carried out after the turn of the year by an administrator with specialist knowledge. This is a prerequisite for you to be able to continue working with Origin & Preferences. Also take this into account for substitution situations such as vacation or sick days.
• If you use customized forms in Origin & Preferences, these only need to be adapted in special cases. You can find information on this in the article PEM rules 2025: Challenges and your next steps.

Technical information and instructions

Prepare yourself for the changeover from now until December 2024. You can find information on your next steps in the article PEM rules 2025: Challenges and your next steps and the other articles in this section.

Subscribe now and stay up to date.

It’s quite simple: Subscribe to this Help Center article. With this, you make sure you are always informed by email about updates. This will allow you to stay up to date and make your own active contribution.

You have never subscribed to an AEB Help Center article before? No problem, you will find a short description on how to proceed here.

Please note:

• At least one responsible person in your company must subscribe to this Help Center article as part of your obligation to cooperate and initiate the necessary steps for your company. If necessary, forward this email to the person responsible in your company.
• You will need the information provided there to ensure that everything goes smoothly at the turn of the year. AEB is not responsible for the consequences of non-compliance with the information provided and any resulting disruptions in your business processes.
• AEB will exclusively use the Help Center to provide technical information for your company.