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NAFTA transition to CUSMA/USMCA

Canada, Mexico, and the United States have taken measures necessary to comply with their commitments under the Canada-United States-Mexico Agreement (CUSMA/USMCA), and that the Agreement is expected to enter into force on July 1, 2020.

What does this mean?

Once CUSMA/USMCA comes into effect, preferential tariff treatment will be based on satisfying the rules of origin requirements of the new agreement.

That said, for many goods, there will be no difference between the NAFTA and CUSMA/USMCA rules of origin.  Keep in mind that there have been some changes to the existing NAFTA rules of origin and the product specific rules of origin must be reviewed.

The specific rules of origin are provided in Annex 4-B (Chapter 4) of the Agreement.

CUSMA/USMCA will require a certification of origin that is the basis for a claim for preferential tariff treatment under the Agreement. The certification can be completed by the Importer, Exporter, or Producer in accordance with Article 5.2 (Claims for Preferential Tariff Treatment). Any Party who completes a certification of origin must be able provide documents or other information to support the certification.

The required data elements for a certification-of-origin completed by either the importer/exporter/producer are provided in Annex 5-A (Chapter 5) of the Agreement.

Any Party who completes a certification of origin must be able provide documents or other information to support the certification to the appropriate customs authorities upon request.

Special Rules of Origin for Automotive Goods

The Appendix to Annex 4-B (“the automotive appendix”) of the CUSMA/USMCA includes additional requirements that apply to automotive goods, including additional certification requirements.

Special Rules of Origin for Textiles/Tariff Preference Level (TPL) Claims

Textiles and apparel products may qualify as originating under CUSMA/USMCA if they meet the requirements as specified in the Agreement.

Record Keeping

Records relating to claims of the preferential tariff treatment under CUSMA/USMCA must be maintained by the importer for six years plus current in Canada and for five years plus current in the United States.

We are currently working on a CUSMA/USMCA certification-of-origin template for us by clients that will be available shortly.

Text of the Canada-US-Mexico Agreement

 

 

 

 

 

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COVID-19 is a global challenge. Keeping our supply chains moving is important for maintaining the health and wellbeing of citizens and businesses. While the Canada - U.S. border is now closed to non-essential traffic, it is still open for trade and commerce. We are committed to doing our part for global supply chains.

We are protecting the health and safety of our employees. They are working from home, except for critical functions that require certain equipment or managing paper/courier flow. In those cases we are following social distancing guidelines.

We are open and available to assist you, and key players in your supply chains. Our dedicated staff are available 24/7 and our brokerage and logistics experts are available to help you make adjustments to your supply chain, if necessary.

We encourage you to check out the government programs available to families, businesses, exporters and importers. And, while respecting the need for social distancing we encourage everyone, including our staff, to reach out and remain connected to family, friends, colleagues and customers.

Stay safe.

Peter Willson
Chairman & CEO
Willson International

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