Do Your Goods Qualify for NAFTA Certification?

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Hi
my name is Tanya Copet. I am a Client Relations Representative here at GHY
International. Today I’m going to talk to you about NAFTA or more specifically key
elements that should be considered when deciding if your goods qualify for
preferential treatment. The NAFTA Certificate of Origin is used by the
United States Canada Mexico and Puerto Rico to reduce or eliminate duty for
purposes of obtaining preferential tariff treatment. This document must be
completed legibly and in full by the exporter and be in the possession of the
importer at the time the declaration is made. There are many misconceptions
surrounding this topic many exporters believe that if the goods are made in or
exported from a NAFTA country they automatically qualify for a NAFTA
certification and as such feel obligated to provide a certificate upon the
request of the importer or their broker. This is not always the case and today
I’m going to talk to you about the most common natural errors.
Many people confuse country of origin with country of export and believe that
they are one in the same. Country of origin means the country in which the
goods are manufactured obtained or wholly produced. Country of origin can
also mean the country in which the goods have undergone a substantial
transformation. On the other hand country of export is simply the country from
which the goods are exported. Once you have determined the country of origin to
be Canada United States Mexico or Puerto Rico, it is important to understand that
they do not necessarily qualify for a NAFTA certification. The exporter must
first determine the HS tariff classification and subsequently meet the
applicable rules of origin as outlined in Chapter four of the NAFTA Agreement.
It is important to remember that a NAFTA certificate is not a requirement when
goods are moving between NAFTA countries. The submission of a valid certificate is
the choice of the shipper and declaring NAFTA should be considered carefully as
the validity of a NAFTA certificate must be proven in the event of a future
customs audit situation. For a NAFTA certificate to be valid it must
completed and signed by the exporter in cases where the exporter is not the
producer the exporter may complete the certificate on the basis of. A. knowledge
that the goods originated. B. Reasonable reliance on the producers written
representation that the goods originate or C. a completed and signed
certificate of origin voluntarily provided by the producer. An exception
occurs when shipping items which are of low value an exporter can opt to provide
a low value statement for commercial goods under $2,500 Canadian in lieu of a
formal NAFTA certificate however the same level of compliance must be
maintained. A NAFTA certificate of origin can be provided to the importer on a per
shipment basis or can be valid for a blanket period of up to one year. In
Canada the importer must maintain records for six years plus the current
year. If the importer is found to be non-compliant with record-keeping they
will be subject to AMPS penalties and possible duties owing. If you do not have
a certificate at the time of importation you do have up to one year to obtain and
provide a valid NAFTA certificate in order to recover duties paid. On November
30th 2018 the new Canada-United States-Mexico Agreement was signed, we
are sure to be seeing many changes to NAFTA in the near future. For more
information please don’t hesitate to reach out to our Consulting Department.

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