Lawyers Say Liberalized Rules of Origin in USMCA Will Please Traders
Braumiller Law Group attorneys told webinar listeners April 20 that outside of the automotive sector, the U.S.-Mexico-Canada Agreement has more liberal rules of origin than NAFTA. Jim Holbein said that the decision on whether a product qualifies based on tariff shift is a “much simpler rule to apply. I believe that’ll be useful, particularly if your process for obtaining origin is based all on NAFTA.” He gave the example of a flat-screen TV assembled in Mexico, which currently has content percentage rules. Under USMCA, if the manufacturing process qualifies as substantial transformation, that's enough to count as Mexican.
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Adrienne Braumiller, founder of the firm, said that even though there will no longer be a certificate of origin form, importers will still need to have certification in hand at the time of entry. A digital submission from a producer or exporter -- including a digital signature -- is fine, as is a blanket one-year term. Blanket certificates are allowed under NAFTA, as well.
If the certification is illegible or incomplete, the importer has five working days to submit whether duty benefits are requested. The importer can also make a subsequent claim, but Braumiller said that as she read the implementing regulations released April 19, she saw that the merchandise processing fee cannot be refunded in that case.
The fact that there is no standard form for certificate of origin “will make it a little more difficult to certify for errors or omissions,” she said. But she said she expects trade associations may come up with an informal template, which would help for standardization. The implementing instructions from CBP could change, and if companies or trade association think changes are needed, they can give that input now, the lawyers said.