A claim for preferential NAFTA treatment is normally made on the customs documents used when the goods enter Canada, Mexico or the United States. Procedures will vary because the forms and practices of each country are different.
Procedures in Canada
To claim preferential tariff treatment under the NAFTA, importers shall make the written declaration of origin by completing field number 14 of the Revenue Canada B3 accounting document, with the appropriate code for the tariff treatment claimed. Importers must have the Certificate of Origin in their possession at the time of declaration, but do not have to present the Certificate at that time. However, it must be available upon request to present to Revenue Canada.
Low Value Commercial Importations. In order to claim NAFTA preferential tariff treatment on commercial importations valued at less than US$1000 (C$1,600), importers must have certification of origin in the form of a statement, either included in the invoice or attached to the invoice. The formal Certificate of Origin is not required, provided that the importation is not part of a series of importations arranged to circumvent the formal certification requirements.
Declaration of Origin After Importation. Importers can apply for a refund of duties where the imported goods would have qualified for preferential treatment at the time of entry but no claim was made because the importer did not have a Certificate of Origin at that time.
Any person who paid the duties on the goods may apply for the refund within one year from the time the goods were originally accounted for. The application for refund will be:
- made using a Revenue Canada customs from B 2 under legislative authority 74 (1) (c.1) of the Customs Act; supported by a valid and complete Certificate of Origin; and
- made at the customs office in the region where the goods were released or, where goods were imported by mail, at any customs regional office in Canada.
Corrections to Declaration of Origin. Importers or owners of goods for which preferential tariff treatment under the NAFTA was claimed, or any person authorized to account for those goods, will make a correction to the declaration of origin and pay any duties which may be owing on the amount. The correction must be made:
- within 90 days after the person has reason to believe that the original declaration is incorrect; and
- on a properly completed Revenue Canada Customs form B 2, under legislative authority 32.2(1) of the Customs Act.
Procedures in Mexico
Importers shall use a customs broker (a private-sector provider of services) of choice to obtain release of the merchandise. The customs agent shall provide to importers all necessary information relating to applicable duties and non-tariff regulations. The customs entry shall be accompanied by:
- the commercial invoice when the customs value of the merchandise is determined in accordance with transaction value and exceeds US$300, or the equivalent in another foreign currency. The invoice shall be prepared in Spanish, English or French. In cases where it is not, a translation may be prepared on the reverse or in the body of the invoice;
- the bill of lading or airway bill of lading, endorsed by the transport company;
- documents evidencing compliance with requirements relating to restrictions and non-tariff regulations applicable to the importation;
- proof of the country of origin, and country of export, as appropriate;
- the document demonstrating guarantee for the payment of additional amounts that may arise if the declared value is less than the estimated price established by the Secretary of the Treasury and Public Credit for the merchandise which has been undervalued;
Commercial invoices are not required for imports and exports made by foreign embassies and consulates or by their officials and employees; those relating to electric energy, crude petroleum, natural gas and their derivatives when made by pipeline; nor for personal effects. The importer shall present a declaration in writing and under oath for the customs officials, with those elements that permit determination of the customs value of the merchandise. A copy of this declaration shall be given to the customs broker or attorney for use in determining the customs value on the entry.
The customs agent prepares the import entry using information provided by the importer and pays monies owed to the private bank located within Customs. The customs broker then presents the merchandise, accompanied by the previously paid customs entry, to the mechanism for random selection for examination.
The customs official activates the mechanism for random selection, which determines whether or not the shipment will be examined. If the shipment is designated for review, the examination shall be accomplished within three hours. This period may be greater when discrepancies are discovered. If the shipment is not designated for review, it will be released immediately so that it may proceed to its destination.
Importers shall retain documentation that proves the legal importation of the merchandise, in case the fiscal authorities require clarification after customs clearance.
Procedures in the United States
Existing entry procedures will continue to be used under the NAFTA. As with other trade preference programs, importers must claim NAFTA benefits to receive preferential duty treatment. In the United States, a claim is made by inserting "MX" or "CA," as appropriate, as a prefix to the tariff classification number on Customs Form 7501. The Importer of Record's signature on the CF 7501, in conjunction with this prefix, constitute the importer's written declaration that the goods are entitled to benefits.
Pursuant to Article 503 of the Agreement, the U.S. does not require a Certificate of Origin for entries valued at US$2500 or less. For commercial shipments, however, the invoice accompanying the importation should include a statement certifying that the goods qualify as originating goods.
Port Directors may require a valid Certificate of Origin before allowing NAFTA treatment if they determine that a series of importations was used instead of a single importation to evade the requirement to obtain a Certificate of Origin.
Claims After Importation
Occasionally, claims for NAFTA treatment will not be made when merchandise is entered. In some cases this may be because the Agreement prohibits importers from claiming preferential treatment under the NAFTA unless they possess a valid Certificate of Origin, which may not be obtained until after the goods are entered. Or importers may simply not be aware that the goods qualify for preferential treatment.
Where goods would have qualified for preferential treatment when imported but no claim was made at that time, importers may apply for a refund of any excess duties paid as a result of the goods not having been accorded NAFTA treatment. Requests for refunds must be made within one year after the date of importation.
Importers should request refunds from the Customs Port Director of the port where the goods were entered. Requests must be in writing and shall include:
- a declaration that the goods qualified as originating goods at the time of importation;
- a copy of the Certificate of Origin;
- other supporting documentation as required.
Importers are required to promptly make corrected declarations and pay any duties owed if they determine that a Certificate on which a declaration was based contained incorrect information.