Free Trade Agreement Series: Part 2- Importer Requirements Under NAFTA

Having originated nearly 20 years ago NAFTA, is a well established free trade agreement that continues to have a significant impact on importers and exporters.  In efforts to open global markets to U.S. businesses, the U.S. government has entered or is planning to enter into fourteen other free trade agreements and promotions.   The most recent agreements include the Colombian FTA, the KORUS (Korea) FTA, and the Panama TPA.

With these new FTAs comes the need to revisit basic principles of NAFTA in order to better understand the rules and regulations these new FTAs will impose on exporters and importers.  Throughout the next few weeks, this series on FTAs will delve not only into NAFTA requirements, but will move on to discuss the implications on free trade that other FTAs have had and will have on the U.S. trade community.

In last week’s entry we discussed the requirements for exporting goods to Mexico or Canada (“NAFTA Countries”).  Importing requirements are similar in some ways, but in order to ensure preferential duty, you should be aware of the significant differences.  In the U.S., the rules governing NAFTA importers are set forth in 19 C.F.R. 181 Subpart C* and 19 U.S.C. Chapter 21.

  • Declaration = A declaration must be made seeking duty free treatment for importing goods into the US. The declaration must include as a prefix the symbols “CA” if your product is from Canada, or “MX” if it is for Mexico.  Generally, this declaration will be based on the Certificate of Origin (this is the same document, CBP form 434, as that referenced in the exporter post last week. http://forms.cbp.gov/pdf/CBP_Form_434.pdf
  • Any errors on the declaration and/or Certificateof origin should be corrected in writing within 30 days of the mistake being discovered, and any change in duty must be paid.
  • Records and Submissions = Importers must maintain all importation documents pertaining to their product, including a copy of the Certificate of Origin, for five years after the entry of the goods.  Such documentation must be provided to the port director upon request (within 4 years of the date on the Certificate) and must include:
  1. CBP Form 434 signed by exporter or exporter’s authorized agent
  2. Be completed in English or have an English translation if prepared in the language of the actual Country of Origin
  • The Certificate and Declaration may be applicable to single or multiple importations occurring within a specific period of time set forth by the exporter or producer but not to exceed 12 months.
  • Acceptance = When the Certificate is accepted by the port director as valid, the acceptance will result in the imported goods being granted preferential treatment.
  • Certificate Not Required When=
    1. The port director is satisfied that the product is NAFTA qualified and waives the Certificate requirement
    2. The importation of the product is non-commercial
    3. The total value of the originating goods does not exceed US$ 2,500.  In this instance; however, your invoice must be included with the following signed and dated statement:

“I hereby certify that the good covered by this shipment qualifies as an originating good for purposes of preferential tariff treatment under the NAFTA.”

  1. The statement must indicate whether the signatory is the producer, exporter, importer, or agent.
  • Failure to comply with regulations may result in the cancelation or denial of preferential treatment for your product.

* http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr&sid=707af3099083c027393664c26eeb50ca&rgn=div6&view=text&node=19:2.0.1.1.25.3&idno=19

**http://www.law.cornell.edu/uscode/text/19/chapter-21

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One response to “Free Trade Agreement Series: Part 2- Importer Requirements Under NAFTA

  1. Pingback: Free Trade Agreement Series: Part 4- The New Korean Market and Rules of Origin | The Mooney Law Firm LLC

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