Tiếng ViệtWe are an Asian company supplying labels and packaging products for several EU based textile brands. Our customers order our printed labels and pack them together with their products. The textile products are then sold on the EU market together with our labels. Will the paper labels that come with the products (e.g., clothing, shoes) be exempt from the EUDR?
Please see our previous post on when packaging materials are exempt from EUDR for more information about packaging.
In this case, paper labels fall under HS code 4821: Paper or paperboard labels of all kinds, whether or not printed. HS code 4821 is covered by Annex I of EUDR: “pulp and paper of chapter 47 and 48 of the Combined Nomenclature with the exception of bamboo-based and recovered (waste and scrap) products.”
In the FAQs of EC, it states that.
Packaging material used exclusively as packaging material to support, protect or carry another product placed on the market is not a relevant product within the meaning of Annex I of the Regulation, regardless of the HS code under which they fall.
User manuals accompanying shipments are also falling under this exemption unless they are purchased in their own right.
In terms of function, labels cannot be used to ‘protect or carry’ another product, but rather to provide information about brands, logos, materials, instructions for use, etc. of the product it accompanies.
There are two ways to interpret “support” in this context. First, it is physical support. For instance, it could entail using cardboard or paperboard in addition to packaging materials (such as carton boxes or crates) to give the goods an extra layer of support.
Second, it means providing supporting information and instructions for use/care for the product it accompanies. This is reflected in the example of the user manuals of the EC FAQs above. Given that labels provide details about the brand, the product’s materials, and how to care for them, one could argue that they serve to support the products with which they are associated. Therefore, unless the labels are bought separately on their own right, it ought to be exempt from EUDR.
With this, we can divide the situation into 2 scenarios as follows:
Scenario 1: The textile brands buy the labels from your company and pack it with clothes in their workshops outside EU. The clothes/shoes are then exported to the EU.
In this instance, the labels are purchased by the brands from your company in Asia, and the labeling process is carried out in their workshop outside of the EU. The paper labels are not sold by the brands on the EU market as stand-alone items (i.e., not giving the product its essential character). The labels were also not imported in their own right. It means it do not need to be declared for the customs procedure “release for free circulation”. As a result, product labels in this situation should not be considered relevant products and should be exempt from EUDR.
Scenario 2: The textile brands import the labels from your company into the EU and subsequently label their products there.
If the textile brands must import paper labels into the EU from third countries and then label their products (shoes, garments) there, EUDR applies to these imported labels.
Although the labels are later used to label the products, they are considered to be imported/purchased in their own right. In Annex I of the EUDR, paper label is a relevant product that falls under HS code Chapter 48. Therefore, the textile brands are considered as operators under EUDR and are subject to due diligence. The brands must submit a due diligence statement to the Information System and include the due diligence statement reference number in the customs declaration for release for free circulation.
However, brands are not required to exercise due diligence or provide a due diligence statement for the product label when it is subsequently used to label their products, as it is not sold as a product in its own right, but rather as a label (which does not give the product its essential character) and is therefore not regulated as a relevant product under the EUDR.
Please note that this is my interpretation only. For confirmation of how it should apply in your case, we strongly advise you to contact / send your question directly to the competent authorities in your country / region.
