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On November 30, 2018, Canada, the United States, and Mexico signed the new Canada-United States-Mexico Agreement (CUSMA) / United States-Mexico-Canada Agreement (USMCA) / Tratado entre México, Estados Unidos y Canadá (T-MEC). This agreement will modernize the North American Free Trade Agreement (NAFTA) by addressing current trade challenges in key industries, such as agriculture and automotive, and making improvements to better facilitate the free flow of goods between all three countries. Tariff-free access to markets will continue and provisions have been included for important issues like intellectual property, labour standards, gender equality, and indigenous peoples’ rights.

On December 10, 2019 all three countries agreed upon and signed an updated agreement with additional amendments in the areas of dispute settlement, intellectual property, labour standards, environment, and the rules of origin. Each country is required to ratify the updated new agreement with their respective legislative bodies before it can come into force. Once ratified by all three countries, the updated new agreement will replace the current NAFTA and it will come into force on the first day of the third month after all three countries submit formal notification of their ratification. Formal ratification by all three countries is expected to be completed in early 2020.

Proposed Proof of Origin Requirements

In order to claim the preferential tariff treatment for each country under CUSMA/USMCA/T-MEC, a set of data elements referred to as a ‘certification origin’ must be provided by the exporter, producer or importer of the goods by adding the information to any document (e.g., Commercial Invoice) accompanying the shipment, or if preferred, by providing it on a separate document. In addition, the imported goods must originate* and be exported from a CUSMA/USMCA/T-MEC country.

The certification of origin can be completed in English, French, or Spanish and will not have to follow a prescribed format, but will need to include the minimum data elements listed below:

Certification of Origin minimum data elements:

1. Indicate the Certifier (Importer, Exporter or Producer)

2. Name, Address (including country) and Contact Information of the Certifier

3. Name, Address and Contact Information of the Exporter (if different from the certifier) 

4. Name, Address and Contact Information of the Producer (if different from the certifier, or exporter)

5. Name, Address and Contact Information of the Importer

6. Description and HS Tariff Classification (6 digit level) for the Goods (include invoice# if known)

7. Origin Criterion for the Goods, as set out in 'Article 4.2: Originating Goods' of the CUSMA Rules of Origin

8. Blanket Period (date range up to 1 calendar year)

9.Authorized Signature and Date

The certification** will need to be signed and dated by the certifier and accompanied by the following statement:

“I certify that the goods described in this document qualify as originating and the information contained in this document is true and accurate. I assume responsibility for proving such representations and agree to maintain and present upon request or to make available during a verification visit, documentation necessary to support this certification."

Highlights of the Proposed Changes CA Imports
CUSMA/USMCA/T-MEC Certification of Origin Will replace the current NAFTA ‘Certificate of Origin’ proof of origin requirement.
NAFTA Tariff Treatments (TT 10,11, and 12) Will be eliminated and replaced with new CUSMA/USMCA/T-MEC tariff treatments.
*Increased De Minimis (the monetary value below which qualifying shipments are free from duties, taxes, or formal customs import procedures)

Shipments with a value below the de minimis threshold are exempt from providing a certification of origin. The current value threshold of CAD$20 will increase for express courier shipments (postal shipments not included) imported directly from a CUSMA/USMCA/T-MEC country, regardless of the country of origin, as follows:

  • Goods valued at CAD$40 or less will not be charged duties and taxes.
  • Goods valued from CAD$40 to CAD$150 will not be charged duty but are subject to applicable Federal and Provincial taxes.
**Commercial Goods Shipments with a value less than CAD$3300 will be exempt from providing a certification of origin, however, a low value CUSMA/USMCA/T-MEC statement could still be required.
Casual Goods (other than for sale or for commercial use) A certification of origin is not required, however, the country of origin for these imports must be from a CUSMA/USMCA/T-MEC country and clearly marked on any accompanying supporting documents (e.g., Commercial Invoice and/or Air waybill) to benefit from the preferential tariff treatment.
Courier Low Value Shipment (CLVS) Value Threshold Shipments imported with a value below the CLVS threshold (containing goods that are not regulated, controlled or prohibited) do not require formal entries to be submitted for customs clearance. The CLVS threshold will increase from CAD$2,500 to CAD$3,300 for all imports, regardless of origin.
New Tariff Rate Quotas (TRQs) Will be phased in over an agreed upon period of years to increase market access to specified agricultural products such as dairy, poultry and eggs.
Automotive Industry – New country of origin rules and labour provisions for manufacturing These include, but are not limited to, the following:
  • Introduction of a Labor Value Content (LVC) requirement where a certain percentage of a car producer’s activities must be carried out by workers earning an average wage of at least US$16/hour.
  • At least 70% of steel and aluminum purchases made by vehicle producers must originate from North America.
  • 70% of all steel manufacturing processes must take place in a CUSMA/USMCA/T-MEC county, with the exception of metallurgical processes.
  • Higher Regional Value Content (RVC) required for certain automobiles and automobile components; 75% must be from a CUSMA/USMCA/T-MEC country (up from 62.5%).
Textile and Apparel Goods - Tariff Preference Levels (TPL) Commitments previously established under NAFTA have been largely maintained with CUSMA/USMCA/T-MEC. The quota will decrease for wool apparels from the US and will increase for cotton/man-made fiber apparels from the US.

Please note that all information is subject to change prior to ratification by all countries. Updates will be provided as more information becomes available.


Additional Resources

CUSMA – Full Text of the Agreement

Tariff Schedule of Canada (Tariff Rate Quotas)

CUSMA – Chapter 6: Textile and Apparel Goods

USMCA Issue-Specific Fact Sheets

CUSMA – Summary of revised outcomes