Whether you’re an importer, exporter, or producer of goods in Canada, the United States, or Mexico, you must have a valid certificate of origin that confirms that your goods qualify for preferential tariff treatment and meet other key regional trade requirements.
This certificate is one of the main provisions in the Canada-United States-Mexico Agreement (CUSMA). This trade agreement came into force in July 2020 as a substitute for the North American Free Trade Agreement (NAFTA). The new treaty allows importers to file for preferential tariff treatment for their goods when crossing the border.
As noted above, you need a valid CUSMA certificate of origin to file this claim. What is CUSMA, and why is a CUSMA certificate of origin necessary? How does CUSMA work? In this article, we will walk you through the process!
What Is CUSMA?
As mentioned above, CUSMA is a new trade agreement between Canada, the United States, and Mexico. It can also be referred to as ‘USMCA’ or ‘Tratado entre México, Estados Unidos y Canadá’ (T-MEC).
Each country has its unique acronym for the treaty, but all of them refer to the same trade agreement. CUSMA was created to offer the three member countries a level playing field when doing business with each other.
How Does a CUSMA Certificate of Origin Work?
CUSMA was created to liberalize trade between the three nations and eliminate punitive tariffs and trade barriers that hindered trade. With CUSMA, the three countries can enjoy a larger market for their goods and services as it ensures that there are no repressive laws creating barriers to free trade within the region.
With a CUSMA certificate of origin, you are 99.99% likely to receive preferential tariff treatment for the goods you want to export to the US and Mexico. According to CUSMA rules of origin, a certificate of origin should be completed if the producer of the goods has information, such as documents, demonstrating that the goods are originating from one or more of the three member countries.
If the exporter isn’t the producer of the goods, this certificate shall be completed by the exporter, provided they have the necessary documents or the producer’s written submission proving that the goods are originating.
How Do You Get a CUSMA Certificate of Origin?
Under CUSMA, the certificate of origin can be provided on the invoice or any other document issued as part of the transaction. Under NAFTA, exporters, traders, and producers in the region had to fill out a specific form to file for a preferential tariff treatment claim.
Do you need a CUSMA form? No, you don’t. The new treaty has eliminated the need to fill out a specific form. You’re only required to complete the CUSMA certification of origin, which consists of a set of basic data elements.
These data elements are clearly set out in annex 5A. While the certificate of origin is now available on invoices, you shouldn’t rely on certificates issued on invoices or other commercial documents provided in a non-party transaction.
However, CUSMA rules of origin prohibit a party from rejecting a preferential tariff treatment claim solely because the invoice or the commercial document was provided in a non-party transaction.
The treaty requires the party issuing the certificate of origin to provide it in a language that is understandable to the certifying party. This certificate is normally available in three languages, English, Spanish, and French.
If the importing party doesn’t understand the language of the certification issued to them, they can request a translation. Lastly, this certificate can be completed and submitted electronically and accepts electronic and digital signatures.
References:
- https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/cusma-aceum/text-texte/05.aspx?lang=eng
- https://www.shippingsolutions.com/cusma-certificate-of-origin-english
- https://www.cba.org/Sections/Commodity-Tax-Customs-and-Trade/Articles/2020/Certification-of-Origin-requirements
disqus comments