As part of the international division of labour Union products often undergo production processes in third countries for a variety of reasons; for example, to take advantage of lower labour costs, or of specific technical expertise.
In order that the processed products not be subject to the full customs duty when they are (re) imported, they can be placed under the outward processing customs procedure.

Here, when the processed products undergo customs clearance, allowance is made for the fact that they contain products that originate in the customs territory of the Union for which no duty is charged for economic reasons.

There are three phases to outward processing:

1. Union products are temporarily exported from the customs territory of the Union,
2. they undergo processing operations in a third country
3. after re-importation while subject to either complete or partial exemption from import duties, they are released for free circulation.