GlossaryEN1 min readUpdated: Jun 26, 2026

PAN-EURO-MED Origin System

When goods move between the EU and its partner countries across Europe and the Mediterranean, the PAN-EURO-MED origin system determines whether preferential tariff treatment applies.

Quick Answer

Last updated: 26 June 2026Published: 22 November 2025

Source: https://taxation-customs.ec.europa.eu/customs-4/rules-origin/origin-eu-trade-agreements/paneuromediterranean-cumulation-pem-convention_en

Category

Incoterms 2020 Simulator: Who bears costs & risk?

Reading time

1 min

Words

142

Mentioned in

–

Definition & Explanation

When goods move between the EU and its partner countries across Europe and the Mediterranean, the PAN-EURO-MED origin system determines whether preferential tariff treatment applies. It connects a network of bilateral free trade agreements through shared rules of origin and permits diagonal cumulation: inputs originating in different contracting parties can be combined to meet the origin threshold for a finished product. In practice, this allows supply chains spanning multiple partner countries to remain preference-eligible, provided each processing step complies with the relevant protocol. Freight forwarders and customs teams consult those protocols to establish which proof of origin is required — typically an EUR.1 movement certificate or an origin declaration on the invoice. The system is distinct from the Generalised Scheme of Preferences (GSP), which is a unilateral concession extended to developing countries; PAN-EURO-MED rests on reciprocal agreements between parties on equal footing.