Common use of Fungible Goods or Materials Clause in Contracts

Fungible Goods or Materials. 1. In determining whether a good or material is originating for purposes of granting preferential tariff treatment, any fungible goods or materials shall be distinguished by: (a) physically separating each fungible good or material; or (b) using any inventory management method, such as averaging, last-in-first-out (LIFO) or first-in-first-out (FIFO), recognized in the generally accepted accounting principles of a Party in which the production is performed or otherwise accepted by the Party in which the production is performed. 2. The inventory management method selected under paragraph 1 for a particular fungible good or material shall continue to be used for that good or material throughout the fiscal year of the person that selected the inventory management method.