Making NAFTA Relevant Again! A Look At Certificates Of Origin

Author:Ms Cyndee Todgham Cherniak

Donald Trump and Hillary Clinton talked about the North American Free Trade Agreement (“NAFTA”) during the U.S. Presidential Debate on September 26th.  Donald Trump and Hillary Clinton spoke about NAFTA during the primaries and on the campaign trail.  NAFTA is relevant again!  This is good for customs lawyers and trade lawyers.  With all this talk about NAFTA, it is also a time for Canadian importers to review their NAFTA certificates of origin.

One of the  most common misconceptions about NAFTA is that “all goods purchased from the United States are duty free under NAFTA”.  This is NOT CORRECT!  Only goods that qualify as “originating goods” are entitled to duty-free treatment under NAFTA.

It is important to periodically review and revisit determinations that goods qualify for NAFTA.  It may be that corporate decisions relating to sourcing of goods or inputs has changed since the last review.  If the rule of origin requires a good undergo a regional value content analysis, a change in the sourcing of a major input could affect the overall calculation.

It is also possible that the Canadian International Trade Tribunal (“CITT”), Federal Court of Appeal or the Supreme Court of Canada has made an important decision in the area of tariff classification or origin. For example, the Supreme Court of Canada recently issued a decision in Attorney General of Canada v. Igloo Vikski and established rules for the tariff classification of goods.

If the tariff classification of goods changes, then the applicable rule of origin may also change.  If the rule of origin changes, then an importer should determine whether the new rule of origin results in the good being considered to be an originating good or not.

Originating goods must be accompanied by a properly completed certificate of origin or be covered by a blanket certificate of origin in order to qualify for NAFTA duty-free treatment.

A Certificate of Origin (CO) is an important international trade and legal document that certifies certain information provided therein is correct and attests that the goods identified in the certificate are wholly obtained, produced, manufactured or processed in a particular country...

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