USMCA and Your Documentation

June 10, 2020 Author: Heather Noggle, CEO

The USMCA is coming. On July 1, 2020, USMCA will replace NAFTA without a grace period.

We’ve prepared some quick facts and areas you should be considering if you’re currently working with NAFTA.

US. Canada. Mexico.

  • The United States calls the agreement USMCA (United States–Mexico–Canada Agreement)
  • Canada calls it CUSMA (Canada-United States-Mexico Agreement) 
  • Mexico calls it T-MEC (Tratado entre México, Estados Unidos y Canadá)

The agreement will be implemented somewhat differently in each country, so know that and review. In 2026, it’ll be reviewed for extension.

Certification Paperwork

NAFTA used an official certification form - #434 and #434A (for continuation). The USMCA certification, however, will not require a specific, standardized form. Documentation such as a Commercial Invoice or Certificate of Origin or a Blanket USMCA form must contain minimum data elements for USMCA use, and most of those are clearly stated here in Annex 5-A at the end of Chapter 5.

CBP will likely later offer a format for certification, which must accompany duty-free claims, usually at time of entry of that claim. Post-entry claims are possible but difficult.

You can start your research here about the minimum data elements to represent in the full text.

About Origin

Per product, show the 6-digit HTS (or more). Also, display a description.

“The description should be sufficient to relate it to the good covered by the certification.” Put the invoice number in here for certificates for single shipments.

USMCA also requires a Preference Criterion. “Specify the origin criteria under which the good qualifies, as set out in Article 4.2 (Originating Goods).” The next question is “how”?

For purposes of reporting regarding certification, you’ll need to narrow all of the factors into one of these designations, found in Article 4.2.

Listing the options:

          (a) wholly obtained or produced entirely in the territory of one or more of the Parties, as defined in Article 4.3 (Wholly Obtained or Produced Goods);

          (b) produced entirely in the territory of one or more of the Parties using non-originating materials provided the good satisfies all applicable requirements of Annex 4-B (Product-Specific Rules of Origin);

          (c) produced entirely in the territory of one or more of the Parties exclusively from originating materials; or

          (d) except for a good provided for in Chapter 61 to 63 of the Harmonized System:

                    (i) produced entirely in the territory of one or more of the Parties;

                    (ii) one or more of the non-originating materials provided for as parts under the Harmonized System used in the production of the good cannot satisfy the requirements set out in Annex 4-B (Product-Specific Rules of Origin) because both the good and its materials are classified in the same subheading or same heading that is not further subdivided into subheadings or, the good was imported into the territory of a Party in an unassembled or a disassembled form but was classified as an assembled good pursuant to rule 2(a) of the General Rules of Interpretation of the Harmonized System; and

                    (iii) the regional value content of the good, determined in accordance with Article 4.5 (Regional Value Content), is not less than 60 percent if the transaction value method is used, or not less than 50 percent if the net cost method is used;

Next Steps

Know what July 1, 2020, means for your company with USMCA.

Justify your data proving qualifications, just as you did with NAFTA, and do with your other free trade agreements.

Ensure blanket dates switching is handled.

Help build North American commerce, in the spirit of the agreement. 

Originally posted on Linkedin 5/21/2020