Organization of American States - Trade Unit
Chapter Five Customs Procedures
Subchapter A - Certification of Origin
Article 501: Certificate of Origin
1. Upon the date of entry into force of this Agreement, the
Parties shall establish a Certificate of Origin for the purpose
of certifying that a good being exported from the territory of a
Party into the territory of another Party qualifies as an
originating good, and may thereafter revise the Certificate by
agreement.
2. Each Party may provide that a Certificate of Origin for a
good imported into its territory be completed in a language
required under its laws or regulations.
3. Each Party shall provide that:
(a) an exporter in its territory shall complete and sign a
Certificate of Origin for any exportation of a good for
which an importer may claim preferential tariff
treatment upon importation of the good into the
territory of another Party; and
(b) where an exporter in its territory is not the producer
of the good, such exporter may complete and sign a
Certificate on the basis of
(i) its knowledge of whether the good qualifies as an
originating good,
(ii) reasonable reliance upon the producer's written
representation that the good qualifies as an
originating good, or
(iii) a completed and signed Certificate for the
good voluntarily provided to the exporter by
the producer.
4. Nothing in paragraph 3 shall be construed to require a
producer to provide a Certificate of Origin to an exporter.
5. Each Party shall:
(a) provide that a Certificate of Origin that has been
completed and signed by an exporter or a producer in
the territory of another Party that is applicable to
(i) a single importation of a good into its territory,
or
(ii) multiple importations of identical goods imported
into its territory within any specified period,
not exceeding 12 months, set out therein by the
exporter or producer,
shall be accepted by its customs administration for a
period of four years after the date on which the
Certificate was signed; and
(b) require an exporter or a producer in its territory that
completes and signs a Certificate pursuant to
subparagraph (a) to notify in writing all persons to
whom such Certificate was given of any change that
could affect its accuracy or validity.
Article 502: Obligations Regarding Importations
1. Except as otherwise provided in this Chapter, each Party,
with respect to an importer in its territory that claims
preferential tariff treatment for a good imported into its
territory from the territory of another Party, shall provide
that:
(a) the importer shall make a written declaration, based on
a valid Certificate of Origin, that the good qualifies
as an originating good;
(b) the importer shall have the Certificate in its
possession at the time such declaration is made;
(c) the importer shall provide, upon the request of that
Party's customs administration, a copy of the
Certificate;
(d) if the importer fails to comply with any requirement
set out in this Chapter, that Party may deny
preferential tariff treatment to the good;
(e) the importer, where the importer has reason to believe
that a Certificate on which a declaration was based
contains information that is not correct, shall
promptly make a corrected declaration and pay any
duties owing; and
(f) the importer, who voluntarily makes a corrected
declaration pursuant to subparagraph (e), shall not be
subject to penalties for the making of an incorrect
declaration.
2. Each Party shall provide that, where a good would have
qualified as an originating good when it was imported into the
territory of that Party but no claim for preferential tariff
treatment was made at that time, the importer of the good may,
within one year of the date on which the good was imported, apply
for a refund of any excess duties paid as the result of the good
not having been accorded preferential tariff treatment, upon
presentation of:
(a) a written declaration that the good qualifies as an
originating good at the time of importation;
(b) a copy of the Certificate of Origin to the same effect;
and
(c) such other documentation relating to the importation of
the good as that Party may require.
Article 503: Exceptions
Each Party shall provide that a Certificate of Origin shall
not be required for:
(a) a commercial importation of a good whose value does not
exceed the amount of (US)$1,000 or its equivalent
amount in the Party's currency or such higher amount as
it may establish, except that it may require that the
invoice accompanying such importation include a
statement certifying that such goods qualify as
originating goods;
(b) a non-commercial importation of a good whose value does
not exceed the amount of (US)$1000 or its equivalent
amount in the Party's currency, or such higher amount
as it may establish; or
(c) an importation of a good for which the Party into whose
territory the good is imported has waived the
requirement for a Certificate of Origin,
provided that such importation does not form part of a
series of importations that may reasonably be considered to
have been undertaken or arranged for the purpose of avoiding
the certification requirements set out in Articles 501 and
502.
Article 504: Obligations Regarding Exportations
Each Party shall provide that:
(a) upon the request of its customs administration, an
exporter in its territory, or a producer in its
territory that has provided a copy of a Certificate of
Origin to such exporter pursuant to Article
501(3)(b)(iii), shall provide a copy of the Certificate
to its customs administration;
(b) a false certification by an exporter or a producer in
its territory that a good to be exported to the
territory of another Party qualifies as an originating
good shall have the same legal consequences, with
appropriate modifications, as would apply to an
importer in its territory with respect to a
contravention of its customs laws and regulations
regarding the making of a false statement or
representation;
(c) where an exporter or a producer in its territory fails
to comply with any of the requirements set out in this
Chapter, it may apply such measures as the
circumstances may warrant;
(d) an exporter or a producer in its territory that has
completed and signed a Certificate of Origin, and that
has reason to believe that the Certificate contains
information that is not correct, shall promptly notify
in writing all persons to whom the Certificate was
given of any change that could affect the accuracy or
validity of the Certificate; and
(e) an exporter or a producer who voluntarily provides
written notification pursuant to subparagraph (d) shall
not be subject to penalties with respect to the making
of an incorrect certification.
Subchapter B - Administration and Enforcement
Article 505: Records
1. Each Party shall provide that:
(a) an exporter or a producer in its territory that
completes and signs a Certificate of Origin shall
maintain in its territory, for a period of five years
from the date the Certificate was signed or for such
longer period as such Party may specify, all records
relating to the origin of a good for which preferential
tariff treatment was claimed in the territory of
another Party, including records associated with
(i) the purchase of, cost of, value of, and payment
for, the good that is exported from its territory,
and
(ii) the purchase of, cost of, value of, and payment
for, all materials, including indirect materials,
used in the production of the good that is
exported from its territory, and
(iii) the production of the good in the form in
which the good is exported from its
territory; and
(b) an importer claiming preferential tariff treatment for
a good imported into the Party's territory shall
maintain in that territory, for a period of five years
from the date of importation of the good or for such
longer period as the Party may specify, a copy of the
Certificate and all other required documentation
relating to the importation of the good.
Article 506: Origin Verifications
1. For purposes of determining whether a good imported into its
territory from the territory of another Party qualifies as an
originating good, a Party may, through its customs
administration, conduct a verification solely by means of:
(a) written questionnaires to an exporter or a producer in
the territory of another Party;
(b) visits to the premises of an exporter or a producer in
the territory of another Party to review the records
and observe the facilities used in the production of
the good; or
(c) such other procedure as the Parties may agree.
2. Prior to conducting a verification visit pursuant to
paragraph (1)(b), a Party shall, through its customs
administration:
(a) deliver a written notification of its intention to
conduct such visit;
(i) to the exporter or producer whose premises are to
be visited,
(ii) to the customs administration of the Party in
whose territory the visit is to occur, and
(iii) to, if requested by the Party in whose
territory the visit is to occur, the embassy
of such Party in the territory of the Party
proposing to conduct the visit; and
(b) obtain the written consent of the exporter or producer
whose premises are to be visited.
3. The notification referred to in paragraph 2 shall include:
(a) the identity of the customs administration issuing the
notification;
(b) the name of the exporter or producer whose premises are
to be visited;
(c) the date and place of the proposed verification visit;
(d) the object and scope of the proposed verification
visit, including specific reference to the good subject
to the verification;
(e) the names and titles of the officials performing the
verification visit; and
(f) the legal authority for the verification visit.
4. Where an exporter or a producer has not given its written
consent to a proposed verification visit within 30 days of
receipt of notification pursuant to paragraph 2, the notifying
Party may deny preferential tariff treatment to the good that
would have been the subject of the visit.
5. Each Party shall provide that, where its customs
administration receives notification pursuant to paragraph 2, it
may, within 15 days from the date of receipt of such
notification, postpone the proposed verification visit for a
period not exceeding 60 days from the date of such receipt, or
for such longer period as the Parties may otherwise agree.
6. A Party shall not deny preferential tariff treatment to a
good based solely on the postponement of a verification visit
pursuant to paragraph 5.
7. Each Party shall permit an exporter or a producer whose good
is the subject of a verification visit by another Party to
designate two observers to be present during such visit, provided
that:
(a) the observers do not participate in a manner other than
as observers; and
(b) the failure of such exporter or producer to designate
observers shall not result in the postponement of the
visit.
8. Each Party shall, through its customs administration,
conduct a verification of a regional value-content requirement in
accordance with the Generally Accepted Accounting Principles
applied in the territory of the Party from which the good was
exported.
9. The Party conducting a verification shall provide the
exporter or producer whose good is subject to the verification
with a written determination of whether the good qualifies as an
originating good, including findings of fact and the legal basis
for the determination.
10. Where verifications by a Party indicate a pattern of conduct
by an exporter or a producer of false or unsupported
representations that a good imported into its territory qualifies
as an originating good, such Party may withhold preferential
tariff treatment to identical goods exported or produced by such
person until that person establishes compliance with the
provisions of Chapter Four (Rules of Origin).
11. Each Party shall provide that where it determines that a
certain good imported into its territory does not qualify as an
originating good based on a tariff classification or a customs
value applied by the Party to one or more materials used in the
production of the good, which differs from the tariff
classification or customs value applied to such materials by the
Party from whose territory the good was exported, the Party's
determination shall not become effective until it notifies in
writing both the importer of the good and the person that
completed and signed the Certificate of Origin for the good of
its determination.
12. A Party shall not apply a determination made under paragraph
11 to an importation made before the effective date of the
determination, provided that:
(a) the customs administration of the Party from whose
territory the good was exported has issued an advance
ruling on the tariff classification or on the customs
value of such materials, or has given consistent
treatment to the entry of such materials under the
tariff classification or customs value at issue, on
which a person is entitled to rely; and
(b) the advance ruling or consistent treatment was given
prior to notification of the determination.
13. Where a Party denies preferential tariff treatment to a good
pursuant to a determination made under paragraph 11, it shall
postpone the effective date of the denial for a period not
exceeding 90 days, provided that the importer of the good, or the
person who completed and signed the Certificate of Origin for the
good, demonstrates that it has relied in good faith to its
detriment on the tariff classification or customs value applied
to such materials by the customs administration of the Party from
whose territory the good was exported.
Article 507: Confidentiality
1. Each Party shall maintain, in accordance with its laws and
regulations, the confidentiality of confidential business
information collected pursuant to this Chapter and shall protect
that business information from disclosure that could prejudice
the competitive position of the persons providing the
information.
2. The confidential business information collected pursuant to
this Chapter may only be disclosed to those authorities
responsible for the administration and enforcement of
determinations of origin, and of customs and revenue matters.
Article 508: Penalties
1. Each Party shall maintain measures imposing criminal, civil
or administrative penalties for violations of its laws and
regulations relating to this Chapter.
2. Nothing in Articles 502(1)(d) and (f), 504(e) and 506(6)
shall be construed to prevent a Party from applying such measures
as the circumstances may warrant.
Subchapter C - Advance Rulings
Articles 509: Advance Rulings
1. Each Party shall, through its customs administration,
provide for the expeditious issuance of written advance rulings,
prior to the importation of a good into its territory, to an
importer in its territory or an exporter or a producer in the
territory of another Party, on the basis of the facts and
circumstances presented by such importer, exporter or producer of
the good, concerning:
(a) whether materials imported from the territory of a non-
Party undergo, as a result of production in the
territory of one or more of the Parties, the applicable
change in tariff classification under Chapter Four
(Rules of Origin) to qualify as an originating good;
(b) whether a good satisfies a regional value-content
requirement under either the transaction value method
or the net cost method set out in Chapter Four;
(c) the appropriate basis or method for customs value to be
applied by an exporter or a producer in the territory
of another Party, in accordance with the principles of
the Customs Valuation Code, in calculating the
transaction value of a good, or the value of materials
used in the production of a good, for which an advance
ruling is requested, for the purpose of determining
whether the good satisfies a regional value-content
requirement under Chapter Four;
(d) the appropriate basis or method for reasonably
allocating costs, in accordance with the allocation
methods set out in the Uniform Regulations, for
calculating the net cost of a good, or the value of an
intermediate material, for which an advance ruling is
requested, for the purposes of determining whether the
good satisfies a regional value-content requirement
under Chapter Four;
(e) whether a good that re-enters its territory after the
good has been exported from its territory to the
territory of another Party for repair or alteration
qualifies for duty-free treatment in accordance with
Article 307 (Goods Re-entered After Repair or
Alteration);
(f) whether the proposed or actual marking of a good
satisfies country of origin marking requirements under
Article 312 (Country of Origin Marking); or
(g) whether a good to be imported qualifies as a good of a
Party under Annexes 300-B or 302.2.
2. Each Party shall provide that an advance ruling issued
pursuant to paragraph 1 shall be based on:
(a) for the purpose of determining the origin of a good,
Chapter Four (Rules of Origin), the principles of the
Customs Valuation Code and the Uniform Regulations;
(b) for the purpose of determining country of origin
marking, Article 312 (Country of Origin Marking); and
(c) for the purpose of determining whether a good qualifies
as a good of a Party, Annex 302.2.
3. Each Party shall adopt or maintain procedures for the
issuance of advance rulings, including a detailed description of
the information reasonably required to process an application.
4. Each Party shall provide that its customs administration:
(a) may, at any time during the course of an evaluation of
an application for an advance ruling, request
supplemental information from the person requesting the
ruling;
(b) after it has obtained all necessary information from
the person requesting an advance ruling, shall issue
the ruling in accordance with the time periods
specified in the Uniform Regulations; and
(c) where the advance ruling is unfavorable to the person
requesting it, shall provide that person with a full
explanation of the reasons for the ruling.
5. Subject to paragraph 7, each Party shall apply an advance
ruling to importations into its territory of the good for which
the ruling was requested, commencing on the date of its issuance
or such later date as may be specified therein.
6. Each Party shall provide to any person requesting an advance
ruling the same treatment, including the same interpretation and
application of the provisions of Chapter Four (Rules of Origin)
regarding a determination of origin of a good, as it provided to
any other person to whom it issued an advance ruling, provided
that the facts and circumstances are identical in all material
respects.
7. The issuing Party may modify or revoke an advance ruling:
(a) if the ruling is based on an error
(i) of fact,
(ii) in the tariff classification of a good or the
materials subject to the ruling,
(iii) in the application of a regional value-
content requirement under Chapter Four (Rules
of Origin), or
(iv) in the application of the rules for determining
whether a good qualifies as a good of a Party
under Annexes 300-B or 302.2;
(b) if the ruling is not in accordance with an
interpretation agreed by the Parties regarding Chapter
Three (National Treatment and Market Access for Goods)
and Chapter Four (Rules of Origin);
(c) if there is a change in the material facts or
circumstances on which the ruling is based;
(d) to conform with an amendment of Chapter Three, Chapter
Four, Marking Rules or Uniform Regulations; or
(e) to conform with a judicial decision or a change in its
domestic law.
8. Each Party shall provide that any modification or revocation
of an advance ruling shall be effective on the date on which the
modification or revocation is issued, or on such later date as
may be specified therein, and shall not be applied to
importations of a good that have occurred prior to that date,
unless the person to whom the advance ruling was issued has not
acted in accordance with its terms and conditions.
9. Notwithstanding paragraph 8, the issuing Party shall
postpone the effective date of such modification or revocation
for a period not exceeding 90 days where the person to whom the
advance ruling was issued has in good faith relied to its
detriment on that ruling.
10. Each Party shall provide that where its customs
administration examines the regional value-content of a good for
which it has issued an advance ruling with respect to an approved
basis or method of customs value under Article 509(1)(c), or with
respect to an approved basis or method for reasonably allocating
costs under Article 509(1)(d), or with respect to whether a good
qualifies for duty-free treatment under Article 509(1)(e), it may
evaluate whether:
(a) the exporter or producer has complied with the terms
and conditions of the advance ruling;
(b) the exporter's or producer's operations are consistent
with the material facts and circumstances upon which
the advance ruling is based; and
(c) the supporting data and computations used in applying
the basis or method of customs valuation were correct
in all material respects.
11. Each Party shall provide that where its customs
administration determines that any requirement in paragraph 10
has not been satisfied, it may modify or revoke the advance
ruling as the circumstances may warrant.
12. Each Party shall provide that, where a person can
demonstrate that it used reasonable care and acted in good faith
in presenting the facts and circumstances on which an advance
ruling was based, and where the customs administration of a Party
determines that the ruling was based on incorrect information,
the person to whom such advance ruling was issued shall not be
subject to penalties.
13. Where a Party issues an advance ruling to a person that has
misrepresented or omitted material facts or circumstances upon
which the ruling is based or has failed to act in accordance with
the terms and conditions of such ruling, it may apply such
measures as the circumstances may warrant.
Subchapter D - Review And Appeal of Origin Determinations and
Advance Rulings
Article 510: Review and Appeal
1. Each Party shall grant substantially the same rights of
review and appeal of determinations of origins and advance
rulings by its customs administration as it provides to importers
in its territory to any person:
(a) who completes and signs a Certificate of Origin for a
good that has been subject to a determination of
origin;
(b) whose good has been subject to a country of origin
marking determination pursuant to Article 312 (Country
of Origin Marking); or
(c) who has received an advance ruling pursuant to Article
509(1).
2. Further to Articles 1804 (Administrative Proceedings) and
1805 (Review and Appeal), each Party shall provide that the
rights of review and appeal referred to in paragraph 1 shall
include access to:
(a) at least one level of administrative review,
independent of the official or office responsible for
the determination under review; and
(b) in accordance with its domestic law, judicial or quasi-
judicial review of the determination or decision taken
at the final level of administrative review.
Subchapter E - Uniform Regulations
Article 511: Uniform Regulations
1. Upon the date of entry into force of this Agreement, the
Parties shall establish, and implement through their respective
domestic laws or regulations, Uniform Regulations regarding the
interpretation, application and administration of the provisions
of Chapter Four (Rules of Origin).
2. Each Party shall implement any modification of or addition
to the Uniform Regulations no later than 180 days after the
Parties agree on such modification or addition, or such other
period as the Parties may agree.
Subchapter F - Cooperation
Article 512: Cooperation
1. Each Party shall notify the other Parties of the following
determinations, measures and rulings, including to the greatest
extent practicable those that are prospective in application:
(a) a determination of origin issued as the result of a
verification conducted pursuant to Article 506(1);
(b) a determination of origin that such Party is aware is
contrary to:
(i) a ruling issued by the customs administration of
another Party with respect to the tariff
classification or customs value of a good, or of
materials used in the production of a good, or the
reasonable allocation of costs where calculating
the net cost of a good, that is the subject of a
determination of origin, or
(ii) consistent treatment given by the customs
administration of another Party with respect to
the tariff classification or customs value of a
good, or of materials used in the production of a
good, or the reasonable allocation of costs where
calculating the net cost of a good, that is the
subject of a determination of origin;
(c) a measure establishing or significantly modifying an
administrative policy that is likely to affect future
determinations of origin, country of origin marking
requirements or determinations as to whether a good
qualifies as a good of a Party under the Marking Rules;
and
(d) an advance ruling, or a ruling modifying or revoking an
advance ruling pursuant to Article 509(1).
2. The Parties shall cooperate:
(a) in the enforcement of their respective customs-related
laws or regulations implementing this Agreement, and
under any customs mutual assistance agreements or other
customs-related agreements to which they are party;
(b) for purposes of the detection and prevention of
unlawful transshipments of textile and apparel goods of
a non-Party in the enforcement of prohibitions or
quantitative restrictions, including the verification
by a Party, in accordance with the procedures set out
in this Chapter, of the capacity for production of
goods by an exporter or a producer in the territory of
another Party, provided that the customs administration
of the Party proposing to conduct such verification,
prior to conducting the verification
(i) obtains the consent of the Party in whose
territory the verification is to occur, and
(ii) provides notification to the exporter or producer
whose premises are to be visited,
except that procedures for notifying the exporter or
producer whose premises are to be visited shall be in
accordance with other procedures as the Parties may
agree;
(c) to the extent practicable, for purposes of facilitating
the flow of trade between their territories, in
customs-related matters, such as the collection and
exchange of statistics regarding the importation and
exportation of goods, the harmonization of
documentation used in trade, the standardization of
data elements, the acceptance of an international data
syntax and the exchange of information; and
(d) to the extent practicable, in the storage and
transmission of customs-related documentation.
Article 513: Working Group and Customs Subgroup
1. The Parties hereby establish a Working Group on Rules of
Origin, comprising representatives of each Party, to ensure:
(a) the effective implementation and administration of
Articles 303, 308 and 312, Chapter Four (Rules of
Origin), this Chapter, the Marking Rules and the
Uniform Regulations; and
(b) the effective administration of the customs-related
aspects of Chapter Three (National Treatment and Market
Access).
2. The Working Group shall meet at least four times a year and
at the request of any Party.
3. The Working Group shall:
(a) monitor the implementation and administration by the
customs administrations of the Parties of Articles 303,
308 and 312, Chapter Four, this Chapter, the Marking
Rules and the Uniform Regulations to ensure their
uniform interpretation;
(b) endeavor to agree, upon the request of any Party, on
any proposed modification of or addition to Articles
303, 308 and 312, Chapter Four, this Chapter, the
Marking Rules and the Uniform Regulations;
(c) notify the Commission of any agreed modification of or
addition to the Uniform Regulations;
(d) propose to the Commission any modification of or
addition to Articles 303, 308 and 312, Chapter Three,
Chapter Four, this Chapter, the Marking Rules, the
Uniform Regulations or other provision of this
Agreement as required to conform with any change to the
Harmonized System; and
(e) consider any other matter referred to it by a Party, or
by the Customs Subgroup established under paragraph 6.
4. Each Party shall, to the greatest extent practicable, take
all necessary measures to implement any modification of or
addition to this Agreement within 180 days after the Commission
agrees on any such modification or addition.
5. If the Working Group fails to resolve a matter referred to
it pursuant to paragraph 2(f) within 30 days of such referral,
any Party may request a meeting of the Commission pursuant to
Article 2007.
6. The Working Group shall establish, and monitor the work of,
a Customs Subgroup comprising representatives of each Party. The
Subgroup shall meet at least four times a year and on the request
of any Party and shall:
(a) endeavor to agree on
(i) the uniform interpretation, application and
administration of the provisions of Articles 303,
308 and 312, Chapter Four, this Chapter, the
Marking Rules and the Uniform Regulations,
(ii) tariff classification and valuation matters
relating to determinations of origin,
(iii) equivalent procedures and criteria for the
request, approval, modification, revocation
and implementation of advance rulings,
(iv) revisions to the Certificate of Origin,
(v) any other matter referred to it by a Party, the
Working Group or the Committee on Trade in Goods
established under Chapter Three, and
(vi) any other customs-related matter arising under
this Agreement;
(b) consider
(i) the harmonization of customs-related automation
requirements and documentation, and
(ii) proposed customs-related administrative and
operational changes that could affect the flow of
trade between the Parties' territories;
(c) report periodically to the Working Group and notify it
of any agreement reached under this paragraph; and
(d) refer to the Working Group any matter on which it has
been unable to reach agreement within 60 days after the
matter was referred to it pursuant to subparagraph
(a)(v).
7. Nothing in this Chapter shall be construed to prevent a
Party from issuing a determination of origin or an advance ruling
related to a matter under consideration by the Customs Subgroup
or the Working Group or from taking such other action as it
considers necessary pending a resolution of the matter pursuant
to this Agreement.
Article 514: Definitions
For purposes of this Chapter:
advance ruling means a written interpretation issued by the
customs administration of a Party on the application of a measure
to a given set of facts and circumstances regarding a prospective
importation of a good into its territory;
commercial importation means the importation of a good into the
territory of any Party for the purpose of sale, or any
commercial, industrial, or other like use;
customs administration means the competent authority that is
responsible under the domestic law of a Party for the
administration of customs laws and regulations;
customs value means "customs value" as defined in Article 415;
determination of origin means a determination as to whether a
good qualifies as an originating good in accordance with Chapter
Four (Rules of Origin);
exporter in the territory of a Party includes an exporter located
in the territory of a Party or an exporter required under this
Chapter to maintain records in the territory of that Party
regarding exportations of a good;
identical goods means goods that are the same in all respects,
including physical characteristics, quality and reputation,
irrespective of minor differences in appearance that are not
relevant to the determination of origin of such goods under
Chapter Four (Rules of Origin);
importer in the territory of a Party includes an importer located
in the territory of a Party or an importer required under this
Chapter to maintain records in the territory of that Party
regarding importations of a good;
preferential tariff treatment means the duty rate applicable to
an originating good; and
producer includes a person that grows, mines, harvests,
manufactures, processes, or assembles a good, or any combination
thereof.
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