\[Federal Register: September 6, 1995 (Volume 60, Number 172)\]\
\[Notices\]\
From the Federal Register Online via GPO Access \[wais.access.gpo.gov\]\
\[DOCID:fr06se95-113\]\
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DEPARTMENT OF THE TREASURY\
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Customs Service\
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Regulatory Standards for Implementation of the North American Free Trade
Agreement\
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AGENCY: U.S. Customs Service, Department of the Treasury.\
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ACTION: General notice.\
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SUMMARY: This document publishes for the information of the general
public the text of a document setting forth uniform regulatory standards
adopted by the United States, Canada and Mexico for purposes of
implementing the preferential tariff treatment and other Customs-related
provisions of the North American Free Trade Agreement (NAFTA). The final
Customs Regulations implementing the NAFTA, which are based in part on
the standards set forth herein, also appear in this issue of the Federal
Register.\
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FOR FURTHER INFORMATION CONTACT: Myles Harmon, Office of Regulations and
Rulings (202-482-7000).\
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SUPPLEMENTARY INFORMATION:\
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Background\
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On December 17, 1992, the United States, Canada and Mexico (the
\`\`Parties\'\') entered into an agreement, the North American Free
Trade Agreement (NAFTA). The stated objectives of the NAFTA included
elimination of barriers to trade in, and facilitation of the cross-
border movement of, goods and services between the territories of the
Parties. The provisions of the NAFTA were adopted by the United States
with the enactment of the North American Free Trade Agreement
Implementation Act, Pub. L. 103-182, 107 Stat. 2057.\
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Prior to the entry into force of the NAFTA on January 1, 1994,
representatives of the Parties engaged in a series of trilateral
discussions pursuant to Article 511 of the NAFTA for the purpose of
formulating uniform regulatory texts or principles in respect of
Chapters Four and Five of the NAFTA and in respect of certain provisions
within Chapter Three of the NAFTA. As concerns Chapter Four which sets
forth the rules of origin and related provisions for purposes of
preferential duty treatment under the NAFTA, the Parties agreed, by an
exchange of letters dated December 30, 1993, to implement substantively
verbatim texts covering all of the provisions of that Chapter. However,
in recognition of the different existing customs legal and procedural
requirements in the three countries, in the case of Chapter Five and
some provisions of Chapter Three the Parties agreed, by an exchange of
letters dated December 30, 1993, to use a standards approach whereby
agreement was reached on certain minimum principles to be reflected in
each Party\'s regulations, with each Party being left free to implement
those principles, and any other requirements not inconsistent therewith,
in accordance with the needs of the Party\'s particular statutory and
regulatory framework.\
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On December 30, 1993, Customs published T.D. 94-1 in the Federal
Register (58 FR 69460) setting forth interim amendments to the Customs
Regulations to implement the preferential tariff treatment and other
Customs-related provisions of the NAFTA in accordance with the
implementation principles agreed to by the Parties as discussed above.
Subsequent to the publication of T.D. 94-1, the Parties engaged in
additional trilateral discussions with a view to modifying the Chapter
Four substantively verbatim texts and the standards adopted for purposes
of Chapters Three and Five, and those modifications were formally agreed
to by the Parties through an exchange of letters in June 1995. The
substantively verbatim texts relating to Chapter Four and the standards
adopted for purposes of Chapters Three and Five, as so modified, have
been incorporated in the provisions of the Customs Regulations
implementing the NAFTA that are published as a final rule also in this
issue of the Federal Register.\
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The purpose of this document is to set forth for the information of the
general public the current text of the NAFTA Chapter Three and Chapter
Five regulatory standards document as agreed to by the Parties.\
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Dated: August 24, 1995.\
Stuart P. Seidel,\
Assistant Commissioner, Office of Regulations and Rulings.\
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Accordingly, the document containing the regulatory standards relating
to Chapters Three and Five of the NAFTA, as discussed above, is
reproduced below: Uniform Regulations for the Interpretation,
Application, and Administration of Chapters Three (National Treatment
and Market Access for Goods) and Five (Customs Procedures) of the North
American Free Trade Agreement\
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The Government of Canada, the Government of the United Mexican States
and the Government of the United States of America, pursuant to Article
511(1) of the North American Free Trade Agreement, adopt the following
Uniform Regulations regarding the interpretation, application and
administration of Chapters Three and Five of the North American Free
Trade Agreement:\
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Section A\--Certification of Origin\
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1. The Certificate of Origin referred to in Article 501(1) of the North
American Free Trade Agreement (hereinafter \`\`the Agreement\'\') shall
be:\
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(a) equivalent in substance to the Certificate of Origin set out in
Annex I.1a;\
(b) in a printed format or in such other medium or format as may be
approved by the customs administration of the Party into whose territory
the good is imported;\
(c) completed by the exporter in accordance with these Uniform
Regulations, including any instructions contained in the Certificate of
Origin set out in Annex I.1a; and\
(d) at the option of the exporter, completed in either the language of
the Party into whose territory the good is imported or the language of
the Party from whose territory the good is exported in accordance with
Annex I.1d.\
2. For purposes of Article 501(5)(a) of the Agreement, a single
Certificate of Origin may be used for:\
(a) a single shipment of goods that results in the filing of one or more
entries on the importation of the goods into the territory of a Party;
or\
(b) more than one shipment of goods that result in the filing of one
entry on the importation of the goods into the territory of a Party.\
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Article II: Obligations Regarding Importations\
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1. For purposes of Article 502(1)(a) of the Agreement, \`\`valid
Certificate of Origin\'\' means a Certificate of Origin that the
exporter of the good in a territory of a Party completes in accordance
with the requirements set out in Article I of these Uniform
Regulations.\
2. For purposes of Article 502(1)(c) of the Agreement:\
(a) the importer shall, upon the request of the customs administration
of the Party into whose territory the good is imported, provide a
written translation of the Certificate of Origin in the language of that
Party; and\
(b) where the customs administration of the Party into whose territory
the good is imported determines that a Certificate of Origin is
illegible, defective on its face or has not been completed in accordance
with Article I of these Uniform Regulations, the importer shall be
granted a period of not less than five working days to provide the
customs administration with a copy of the corrected Certificate.\
3. An importer that makes a corrected declaration of origin pursuant to
Article 502(1)(d) and (2)(b) of the Agreement and pays any duties owing
shall not, in accordance with Article 502(2)(b), be subject to
penalties, as set out in Annex II.3.\
4. Where as a result of an origin verification conducted under Article
506 of the Agreement, the customs administration of a Party determines
that a good that is covered by a Certificate of Origin that is
applicable to multiple importations of identical goods in accordance
with Article 501(5)(b) does not qualify as an originating good, such
Certificate may not be used to claim preferential tariff treatment for
those identical goods after the date that the written determination is
provided under Article 506(9).\
Article III: Exceptions\
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1. The statement referred to in Article 503(a) of the Agreement shall,
where required by the customs administration of the Party into whose
territory the good is imported, be attached to, or handwritten, stamped
or typed on, the commercial invoice covering the good.\
2. For purposes of Article 503 of the Agreement, \`\`series of
importations\'\' is defined in Annex III.2.\
Article IV: Obligations Regarding Exportations\
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1. For purposes of Article 504(1)(b) of the Agreement, \`\`promptly\'\'
is defined in Annex IV.1.\
2. For purposes of Article 504(3) of the Agreement, no Party may impose
civil or administrative penalties on an exporter or producer of a good
in its territory where the exporter or producer, prior to the
commencement of an investigation by officials of that Party with
authority to conduct a criminal investigation regarding the Certificate
of Origin, provides the written notification referred to in Article
504(1)(b).\
3. For purposes of Article 504(1)(b) of the Agreement, where the customs
administration of a Party provides an exporter or producer of a good
with a determination under Article 506(9) that the good is a non-
originating good, the exporter or producer shall notify all persons to
whom it gave a Certificate of Origin in respect of that good of the
determination.\
Section B\--Administration and Enforcement\
Article V: Records\
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1. The documentation and records required to be maintained under Article
505 of the Agreement shall be kept in such a manner as to enable an
officer of the customs administration of a Party, in conducting a
verification of origin under Article 506, to perform detailed
verifications of the documentation and records to verify the information
on the basis of which:\
(a) in the case of an importer, a claim for preferential tariff
treatment was made with respect to a good imported into its territory;
and\
(b) in the case of an exporter or producer, a Certificate of Origin was
completed with respect to a good exported to the territory of another
Party.\
2. Importers, exporters and producers in the territory of a Party that
are required to maintain documentation or records under Article 505 of
the Agreement shall be permitted, in accordance with that Party\'s law,
to maintain such documentation and records in machine- readable form,
provided that the documentation or records can be retrieved and
printed.\
3. Exporters and producers that are required to maintain records
pursuant to Article 505(a) of the Agreement shall, subject to the
notification and consent requirements provided for in Article 506(2),
make those records available for inspection by an officer of the customs
administration of a Party conducting a verification visit and provide
facilities for inspection thereof.\
4. A Party may deny preferential tariff treatment to a good that is the
subject of an origin verification where the exporter, producer or
importer of the good that is required to maintain records or
documentation under Article 505 of the Agreement:\
(a) subject to paragraph 5, fails to maintain records or documentation
relevant to determine the origin of the good in accordance with the
requirements of the Agreement, these Uniform Regulations or the Uniform
Regulations under Chapter Four of the Agreement; or\
(b) denies access to the records or documentation.\
5. Where the customs administration of a Party finds during the course
of an origin verification that a producer of a good in the territory of
another Party has failed to maintain its records in accordance with the
Generally Accepted Accounting Principles applied in the territory of the
Party in which the good is produced as required by Article 413(e) of the
Agreement, the producer shall be given an opportunity to record its
costs in accordance with those Generally Accepted Accounting Principles
within 60 days of being informed in writing by the customs
administration that the records have not been maintained in accordance
with those Generally Accepted Accounting Principles.\
6. For purposes of Article 505 of the Agreement and these Uniform
Regulations, \`\`records\'\' include books as referenced in the Uniform
Regulations under Chapter Four.\
Article VI: Origin Verifications\
1. For purposes of Article 506(1)(c) of the Agreement, the customs
administration of a Party may conduct a verification of origin with
respect to a good that is imported into its territory by means of:\
(a) A verification letter that requests information from the exporter or
producer of the good in the territory of another Party, provided that it
contains specific reference to the good that is the subject of the
verification; or\
(b) any other method of communication customarily used by the customs
administration of the Party in conducting a verification.\
2. Subject to paragraph 3, where the customs administration of a Party
conducts a verification under paragraph 1(b), it may, on the basis of a
response of an exporter or producer to a communication referred to in
paragraph 1(b), issue a determination under Article 506(9) of the
Agreement:\
(a) that the good does not qualify as an originating good, provided that
the response is in writing and is signed by that exporter or producer;
or\
(b) that the good qualifies as an originating good.\
3. Where the producer of a good chooses to calculate the regional value
content of a good under that net cost method as set out in the Uniform
Regulations under Chapter Four of the Agreement, the customs
administration of the Party into whose territory the good was imported
may not, during the time period over which the net cost has been
calculated, verify the regional value content in respect of that good.\
4. The customs administration of a Party, in conducting a verification
visit under Article 506(1)(b) of the Agreement, shall send the notice
referred to in Article 506(2)(a) by certified or registered mail, or any
other method that produces a confirmation of receipt by the exporter or
producer whose premises are to be visited.\
5. When the exporter or producer of a good that is the subject of a
proposed verification visit by the customs administration of a Party has
not given its written consent to a visit under Article 506(4) of the
Agreement, the customs administration may determine that the good does
not qualify as an originating good and may deny preferential tariff
treatment to that good.\
6. For purposes of Article 506(7) of the Agreement, an exporter or
producer of a good shall identify to the customs administration
conducting a verification visit any observers designated to be present
during such visit.\
7. Each Party shall identify to the other Parties, by January 1, 1994,
the office to which notice shall be sent under Article 506(2)(a)(ii) of
the Agreement.\
8. For purposes of Article 506(5) of the Agreement, a notice of
postponement of a verification visit shall be made in writing and shall
be sent to the address of the customs office that sent the notice of
intention to conduct a verification visit.\
9. The common standards for the written questionnaires referred to in
Article 506(1)(a) of the Agreement are set out in Annex VI.9.\
10. Where, pursuant to Article 403(3) of the Agreement, a producer of a
motor vehicle identified in Article 403 (1) or (2) elects to average its
regional value-content calculation over its fiscal year, the customs
administration of the Party into whose territory the motor vehicle was
imported may request, in writing, that the producer submit a cost
submission reflecting the actual costs incurred in the production of the
category of motor vehicles for which the election was made.\
11. Where the customs administration of a Party requests that a cost
submission be submitted by the producer of a motor vehicle under
paragraph 10, such cost submission shall be submitted within 180 days
after the close of that producer\'s fiscal year or within 60 days from
the date on which the request was made, whichever is later.\
12. Where the customs administration of a Party sends a written request
under paragraph 10, such request shall constitute a verification letter
under paragraph 1(a).\
13. The customs administration of a Party may, for purposes of verifying
the origin of a good, request that the importer of the good voluntarily
obtain and supply written information voluntarily provided by the
exporter or producer of the good in the territory of another Party,
provided that the failure or refusal of the importer to obtain and
supply such information shall not be considered as a failure of the
exporter or producer to supply the information or as a ground for
denying preferential tariff treatment.\
14. Nothing in this Article shall limit any right accorded under Chapter
Five of the Agreement to the exporter or producer of a good in the
territory of a Party by virtue of the fact that such exporter or
producer is also the importer of the good in the territory of the Party
in which preferential tariff treatment is claimed.\
15. Where a customs administration conducts a verification of origin of
a good under Article 506(1)(a) of the Agreement or paragraph 1(a), it
may send the verification letter or questionnaire by:\
(a) certified or registered mail, or any other method that produces
confirmation of receipt by the exporter or producer; or\
(b) any other method, regardless of whether it produces proof of receipt
from the exporter or producer of the good.\
16. Where the customs administration of a Party has sent a verification
letter or questionnaire to an exporter or producer of a good in the
territory of another Party and such exporter or producer fails to
respond within the period specified therein, which shall be no less than
30 days from the date on which the verification letter or questionnaire
was sent, the customs administration:\
(a) shall send a subsequent verification letter or questionnaire:\
(i) if requested by the Party from whose territory the good was
exported, by the method set out in paragraph 15(a), or\
(ii) if not requested by the Party from whose territory the good was
exported, by the method set out in paragraph 15 (a) or (b); and\
(b) may send, with that subsequent verification letter or questionnaire,
the written determination referred to in Article 506(9) of the
Agreement, including a notice of intent to deny preferential tariff
treatment referred to in paragraph 19.\
17. Where the customs administration of a Party sends a written
determination under paragraph 16(b) and the exporter or producer fails
to respond to the subsequent verification letter or questionnaire within
30 days:\
(a) from the date of its receipt by the exporter or producer, where it
was sent in accordance with paragraph 16(a)(i); or\
(b) from the date of its receipt by the exporter or producer or from the
date it was sent by the customs administration, as the case may be, in
accordance with paragraph 16(a)(ii), the customs administration may deny
preferential tariff treatment to the good.\
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18. Where the customs administration of a Party does not send a written
determination under paragraph 16(b) and the exporter or producer fails
to respond to the subsequent verification letter or questionnaire within
30 days:\
(a) from the date of its receipt by the exporter or producer, where it
was sent in accordance with paragraph 16(a)(i), or\
(b) from the date of its receipt by the exporter or producer or from the
date it was sent by the customs administration, as the case may be, in
accordance with paragraph 16(a)(ii),the customs administration may deny
preferential tariff treatment to the good in accordance with paragraph
19.\
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19. Where the customs administration of a Party determines, as a result
of an origin verification, that a good that is the subject of the
verification does not qualify as an originating good, the written
determination provided for under Article 506(9) of the Agreement shall:\
(a) include a notice of intent to deny preferential tariff treatment
with respect to that good that specifies the date after which
preferential tariff treatment will be denied and the period during which
the exporter or producer of the good may provide written comments or
additional information regarding the determination; and\
(b) if requested by the Party from whose territory the good is exported,
be sent by certified or registered mail or by any other method that
produces confirmation of receipt by the exporter or producer of the
good.\
20. Where the customs administration of a Party determines on the basis
of information obtained during a verification that a good does not
qualify as an originating good:\
(a) the date on which preferential tariff treatment may be denied
pursuant to the notice referred to in paragraph 19, shall be no earlier
than 30 days from the date on which\
(i) receipt of the written determination is confirmed by the exporter or
producer, if a request has been made under subparagraph 19(b), and\
(ii) the customs administration sends the written determination, if no
such request has been made; and\
(b) before denying preferential tariff treatment, the customs
administration shall take into account any comments or additional
information provided by the exporter or producer during the period
referred to in subparagraph (a).\
21. For purposes of Article 506(10) of the Agreement, \`\`pattern of
conduct\'\' means repeated instances of false or unsupported
representations by an exporter or producer of a good in the territory of
a Party that are established by the customs administration of another
Party on the basis of not fewer than two origin verifications of two or
more importations of the goods that result in not fewer than two written
determinations being sent to that exporter or producer pursuant to
Article 506(9) that conclude, as a finding of fact, that Certificates of
Origin completed by that exporter or producer with respect to identical
goods contain false or unsupported representations.\
22. For purposes of Article 506(12) of the Agreement, \`\`consistent
treatment\'\' means the established application by the customs
administration of a Party that can be substantiated by the continued
acceptance by that customs administration of the tariff classification
or value of identical materials on importations of the materials into
its territory by the same importer over a period of not less than two
years immediately prior to the date that the Certificate of Origin for
the good that is the subject of the determination under Article 506(11)
was completed, provided that with respect to those importations:\
(a) such materials had not been accorded a different tariff
classification or value by one or more district, regional or local
offices of that customs administration on the date of such
determination; and\
(b) the tariff classification or value of such materials is not the
subject of a verification, review or appeal by that customs
administration on the date of such determination.\
23. For purposes of Article 506(12) of the Agreement, a person shall be
entitled to rely on a ruling or advance ruling in accordance with Annex
VI.23.\
24. A ruling or advance ruling referred to in paragraph 23 that is
issued by the customs administration of a Party shall remain in force
until modified or revoked.\
25. No modification or revocation of a ruling referred to in paragraph
23, other than an advance ruling, may be applied to a good that was the
subject of the ruling and that was imported prior to the date of such
modification or revocation unless:\
(a) the person to whom the ruling was issued has not acted in accordance
with its terms and conditions; or\
(b) there has been a change in the material facts or circumstances on
which the ruling was based.\
26. For purposes of Article 506(11) of the Agreement, reference to the
phrase, \`\`one or more materials used in the production of the good\'\'
means materials that are used in the production of the good or that are
used in the production of a material that is used in the production of
the good.\
27. Article 506(12)(a) of the Agreement in relation to Article 506(11)
includes:\
(a) a ruling or advance ruling that is issued with respect to a material
that is used in the production of the good or that is used in the
production of a material that is used in the production of the good; or\
(b) the consistent treatment given on the entry of a material that is
used in the production of the good or that is used in the production of
a material used in the production of the good.\
28. Where the customs administration of a Party, in conducting a
verification of origin of a good imported into its territory under
Article 506 of the Agreement, conducts a verification of the origin of a
material that is used in the production of the good, the verification of
the material shall be conducted in accordance with the procedures set
out in:\
(a) Article 506 (1), (2), (3), (5), (7) and (8); and\
(b) paragraphs 1, 2, 3, 4, 6, 8, 13, 14, 15 and 16(a).\
29. The customs administration of a Party, in conducting a verification
of a material that is used in the production of a good pursuant to
paragraph 28, may consider the material to be non- originating in
determining whether the good is an originating good where the producer
or supplier of that material does not allow the customs administration
access to information required to make a determination of whether the
material is an originating material by the following or other means:\
(a) denial of access to its records;\
(b) failure to respond to a verification questionnaire or letter;\
or\
(c) refusal to consent to a verification visit within 30 days of receipt
of notification under Article 506(2) of the Agreement, as made
applicable by paragraph 28.\
30. A Party shall not consider a material that is used in the production
of a good to be a non-originating material solely on the basis of a
postponement of a verification visit under Article 506(5) of the
Agreement as made applicable by paragraph 28(a).\
31. Where the customs administration of a Party conducts a verification
under Article 506 of the Agreement, it may also verify:\
(a) the applicable rate of customs duty applied to an originating good
in accordance with the rules set out in Annex 302.2 of the Agreement;
and\
(b) whether a good is a qualifying good for the purposes of Annex 703.2
of the Agreement.\
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Section C\--Advance Rulings\
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Article VII: Advance Rulings\
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1. For purposes of Article 509 of the Agreement, the customs
administration of a Party shall issue an advance ruling to a producer in
the territory of another Party of a material that is used in the
production of a good in the territory of another Party, provided that
the good is to be subsequently imported into the territory of the Party
issuing the ruling, concerning any matter covered by Article 509(1) (a)
through (e) and (g) with respect to that material.\
2. The common standards regarding the information to be submitted in an
application for an advance ruling are set out in Annex VII.2.\
3. For purposes of Article 509 of the Agreement, an application to the
customs administration of a Party for an advance ruling shall be
completed in the language of that Party as set out in Annex I.1d.\
4. Subject to paragraph 5 and 6, the customs administration to which the
application is made shall issue an advance ruling within 120 days of its
receipt of all information reasonably required to process the
application, including any supplemental information that may be
requested.\
5. Each Party may provide that where an application for an advance
ruling is made to its customs administration that involves an issue that
is the subject of:\
(a) a verification of origin,\
(b) a review by or appeal to the customs administration, or\
(c) judicial or quasi-judicial review in its territory, the customs
administration may decline to issue the ruling.\
\
6. For purposes of Article 509(3) of the Agreement, where the customs
administration of a Party determines that an application for an advance
ruling is incomplete, it may decline to further process the application
provided that:\
(a) it has notified the applicant of any supplemental information
required and of the period, which shall not be less than 30 days, within
which the applicant must provide the information; and\
(b) the applicant has failed to provide the information within the
period specified.\
7. Nothing in paragraph 5 or 6 shall be construed so as to prevent a
person from re-applying for an advance ruling.\
8. For purposes of Article 509(7) of the Agreement, \`\`importations of
a good\'\' is defined in Annex VII.8. Section D\--Review and Appeal\
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Article VIII: Review and Appeal\
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1. A denial of preferential tariff treatment to a good by the customs
administration of a Party under these Uniform Regulations may be
appealed under Article 510 of the Agreement by the exporter or producer
of the good who completed the Certificate of Origin for the good in
respect of which a claim for preferential tariff treatment was denied,
including a denial of preferential tariff treatment under Article
506(4).\
2. Where an advance ruling is issued under Article 509 of the Agreement
or paragraph 1 of Article VII of these Uniform Regulations, a
modification or revocation of the advance ruling shall be subject to
review and appeal under Article 510.\
3. Where a Party denies preferential tariff treatment to a good on the
basis:\
(a) that a corrected Certificate of Origin has not been provided within
that period set out in Article II(2)(b) of these Uniform Regulations,
or\
(b) of a failure to comply with a time limit under these Uniform
Regulations or under the Agreement, except for the time limit under
Article 502(3) of the Agreement, with respect to the furnishing of
records or other information to the customs administration of that
Party, the decision rendered on review and appeal under Article
510(2)(a) of that determination shall be on the merits of whether the
good qualifies as an originating good, provided that in the case of
subparagraph (a) above, a corrected Certificate of Origin is provided to
the customs administration of the Party.\
\
Section E\--Tariff Elimination\
\
Article IX: Tariff Elimination\
\
1. For purposes of Annex 302.2 and Annex 300-B of the Agreement, Annex
302.2 (4), (5), (6), (8), (10), (11), (12) and (13) and Annex 300-B,
Section 2, paragraph 2(b) do not apply where a Party gives duty free
treatment to all other Parties in respect of an originating good
imported into its territory.\
2. For purposes of Annex 302.2 and Annex 300-B of the Agreement, the
customs administration of the Party into whose territory an originating
good is imported shall determine the applicable preferential tariff rate
of duty under Annex 302.2 (8), (10), (11), (12) and (13) and Annex
300-B, Section 2, paragraph 2(b) on the basis of the Marking Rules
established under Annex 311 only where:\
(a) materials used in the production of the good are obtained from,\
or\
(b) processing of the good occurs in,\
the territory of a Party other than the Party from whose territory the
good is exported or the Party into whose territory the good is imported,
provided that the good has been improved in condition or advanced in
value in the territory of the Party from which it is exported.
Otherwise, the customs administration shall apply the preferential
tariff rate of duty that is applicable to the Party from whose territory
the good is exported, provided that the good has been improved in
condition or advanced in value in that territory.\
\
3. For purposes of Annex 302.2 of the Agreement, each Party may,
notwithstanding that the requirements of Article 502 and any other legal
requirements imposed under its law have been satisfied, deny the
applicable preferential tariff rate of duty set out in that Annex to an
originating good imported into its territory:\
(a) if, where contrary to the laws of that Party, the claim for
preferential tariff treatment for the good is not supported by
documentary evidence such as invoices, bills of lading or waybills that
indicate the shipping route and all points of shipment and transshipment
prior to the importation of the good into its territory, and\
(b) if, where the good is shipped through or transshipped in the
territory of a country that is not a Party under the NAFTA, the importer
of the good does not provide, on the request of that Party\'s customs
administration, a copy of the customs control documents that indicate,
to the satisfaction of the customs administration, that the good
remained under customs control while in the territory of such country,\
Section F\--Drawback and Duty Deferral Programs\
\
Article X: Drawback and Duty Deferral Programs\
\
1. For purposes of Article 303 of the Agreement, \`\`identical or
similar\'\' means \`\`identical\'\' and \`\`similar\'\' as defined in
Article 15, subsections 2 (a) and (b) of the Customs Valuation Code, and
as further defined in Annex IX.1.\
2. For purposes of Article 303(1) of the Agreement, \`\`the total amount
of customs duties paid to another Party on the good that has been
subsequently exported to the territory of that other Party\'\' means the
customs duties that are paid in respect of the entry for consumption of
the good in the customs territory of a Party, including any change
referred to under paragraph 7(b).\
3. For purposes of Article 303(1) of the Agreement, where a good is
exported from the territory of a Party to the territory of another Party
and entered into a duty deferral program in that other Party:\
(a) the good shall not be considered to have been exported to the
territory of that other Party unless and until such time as the good is
withdrawn from the duty deferral program for consumption in the customs
territory of that other Party, and\
(b) where the good or another good incorporating that good is
subsequently exported directly from the duty deferral program to a non-
NAFTA country, Article 303 shall not apply to the good, and a refund,
waiver or reduction of duties may be granted upon presentation of
satisfactory evidence of the exportation of the good or that other good
to the non-NAFTA country.\
4. In accordance with paragraph (d) of the definition of
\`\`satisfactory evidence\'\' under Article 318, \`\`satisfactory
evidence\'\' includes an affidavit from the person claiming, subject to
Article 303 of the Agreement, a refund, waiver or reduction of customs
duties, where such affidavit is based on information received from the
importer of the good in the territory of the Party into which the good
was subsequently exported.\
5. Satisfactory evidence, in the form of one or more of the documents
referred to in the definition in Article 318 of the Agreement and
paragraph 4, shall contain:\
(a) the import entry number,\
(b) the date of importation,\
(c) the tariff classification number,\
(d) the rate of duty, and\
(e) the amount of duties paid,\
\
in respect of the importation of the good into the territory of the
Party to which the good was subsequently exported.\
\
6. The Party to whom a claim for refund of the amount of customs duties
paid, or a waiver or reduction of the amount of customs duties owed, is
made may request that the Party to whose territory the good was
subsequently exported examine the information referred to under
paragraph 5 (a) through (e) that was provided in connection with that
claim.\
7. The Party to whom a request was made under paragraph 6 shall:\
(a) where it determines that the information referred to under paragraph
5 is not correct at the time of the request, provide the requesting
Party with the corrected information, and\
(b) monitor the importations in respect of the goods that were the
subject of a request and notify the requesting Party of any change in
respect of the duties paid in connection therewith.\
8. For purposes of Article 303.6(b) of the Agreement, the circumstances
under which a good shall be considered to be in same condition include
the following:\
(a) mere dilution with water or another substance;\
(b) cleaning, including removal of rust, grease, paint or other
coatings;\
(c) application of preservative, including lubricants, protective
encapsulation, or preservation paint;\
(d) trimming, filing, slitting or cutting; (e) putting up in measured
doses, or packing, repacking, packaging ; repackaging; or\
(f) testing, marking, labelling, sorting, or grading,\
\
provided that such operations do not materially alter the
characteristics of the good.\
\
Section G\--Final Provisions\
\
Article XI: Final Provisions\
\
1. For purposes of Chapter Five of the Agreement and these Uniform
Regulations, \`\`completed\'\' means completed, signed and dated.\
2. Each Party shall ensure that its customs procedures governed by the
Agreement are in accordance with Chapter Five of the Agreement and these
Uniform Regulations.\
3. These Uniform Regulations shall enter into force on the date of the
entry into force of the Agreement.\
4. For purposes of Chapter Five of the Agreement and these Uniform
Regulations, any reference to \`\`materials that are used in the
production of the good\'\' or \`\`that are used in the production of a
material that is used in the production of the good\'\' shall include
materials that are incorporated into a good or material as defined in
the Uniform Regulations for Chapter Four.\
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NORTH AMERICAN FREE TRADE AGREEMENT\
\
CERTIFICATE OF ORIGIN INSTRUCTIONS\
\
For purposes of obtaining preferential tariff treatment, this document
must be completed legibly and in full by the exporter and be in the
possession of the importer at the time the declaration is made. This
document may also be completed voluntarily by the producer for use by
the exporter. Please print or type:\
Field 1: State the full legal name, address (including country) and
legal tax identification number of the exporter. Legal tax
identification number is: in Canada, employer number or importer/
exporter number assigned by Revenue Canada; in Mexico, federal
taxpayer\'s registry number (RFC); and in the United States, employer\'s
identification number or Social Security number.\
Field 2: Complete field if the Certificate covers multiple shipments of
identical goods as described in Field #5 that are imported into a NAFTA
country for a specified period of up to one year (blanket period).
\`\`FROM\'\' is the date upon which the Certificate becomes applicable
to the good covered by the blanket Certificate (it may be prior to the
date of signing this Certificate). \`\`TO\'\' is the date upon which the
blanket period expires. The importation of a good for which preferential
tariff treatment is claimed based on this Certificate must occur between
these dates.\
Field 3: State and full legal name, address (including country) and
legal tax identification number, as defined in field #1, of the
producer. If more than one producer\'s good is included on the
Certificate, attach a list of the additional producers, including the
legal name, address (including country) and legal tax identification
number, cross referenced to the good described in field #5. If you wish
this information to be confidential, it is acceptable to state
\`\`Available to Customs upon request\'\'. If the producer and the
exporter are the same, complete field with \`\`SAME\'\'. If the producer
is unknown, it is acceptable to state \`\`UNKNOWN\'\'.\
Field 4: State the full legal name, address (including country) and
legal tax identification number, as defined in field #1, of the
importer. If the importer is not known, state \`\`UNKNOWN\'\'; if
multiple importers, state \`\`VARIOUS\'\'.\
Field 5: Provide a full description of each good. The description should
be sufficient to relate it to the invoice description and to the
Harmonized System (H.S.) description of the good. If the Certificate
covers a single shipment of a good, include the invoice number as shown
on the commercial invoice. If not known, indicate another unique
reference number, such as the shipping order number.\
Field 6: For each good described in field #5, identify the H.S. tariff
classification to six digits. If the good is subject to a specific rule
of origin in Annex 401 that requires eight digits, identify to eight
digits, using the H.S. tariff classification of the country into whose
territory the good is imported.\
Field 7: For each good described in field #5, state which criterion (A
through F) is applicable. The rules of origin are contained in Chapter
Four and Annex 401. Additional rules are described in Annex 703.2
(certain agricultural goods), Annex 300-B, Appendix 6A (certain textile
goods) and Annex 308.1 (certain automatic data processing goods and
their parts). NOTE: In order to be entitled to preferential tariff
treatment, each good must meet at least one of the criteria below.
Preference Criteria\
A\--The good is \`\`wholly obtained or produced entirely\'\' in the
territory of one or more of the NAFTA countries, as referred to in
Article 415. NOTE: The purchase of a good in the territory does not
necessarily render it \`\`wholly obtained or produced\'\'. If the good
is an agricultural good, see also criterion F and Annex 703.2.
(Reference: Article 401(a) and 415)\
B\--The good is produced entirely in the territory of one or more of the
NAFTA countries and satisfies the specific rule of origin, set out in
Annex 401, that applies to its tariff classification. The rule may
include a tariff classification change, regional value-content
requirement or a combination thereof. The good must also satisfy all
other applicable requirements of Chapter Four. If the good is an
agricultural good, see also criterion F and Annex 703.2 (Reference:
Article 401(b))\
C\--The good is produced entirely in the territory of one or more of the
NAFTA countries exclusively from originating materials. Under this
criterion, one or more of the materials may not fall within the
definition of \`\`wholly produced or obtained\'\', as set out in Article
415. All materials used in the production of the good must qualify as
\`\`originating\'\' by meeting the rules of Article 401(a) through (d).
If the good is an agricultural good, see also criterion F and Annex
703.2 (Reference: Article 401(c))\
D\--Goods are produced in the territory of one or more of the NAFTA
countries but do not meet the applicable rule of origin, set out in
Annex 401, because certain non-originating materials do not undergo the
required change in tariff classification. The goods do nonetheless meet
the regional value-content requirement specified in Article 401(d). This
criterion is limited to the following two circumstances:\
1. The good was imported into the territory of a NAFTA country in an
unassembled or disassembled form but was classified as an assembled
good, pursuant to H.S. General Rule of Interpretation 2(a); or\
2. The good incorporated one or more non-originating materials, provided
for as parts under the H.S., which could not undergo a change in tariff
classification because the heading provided for both the good and its
parts and was not further subdivided into subheadings, or the subheading
provided for both the good and its parts and was not further subdivided.
NOTE: This criterion does not apply to Chapters 61 through 63 of the
H.S. (Reference: Article 401(d))\
E\--Certain automatic data processing goods and their parts, specified
in Annex 308.1 that do not originate in the territory are considered
originating upon importation into the territory of a NAFTA country from
the territory of another NAFTA country when the most- favoured-nation
tariff rate of the good conforms to the rate established in Annex 308.1
and is common to all NAFTA countries (Reference: Annex 308.1)\
F\--The good is an originating agricultural good under preference
criterion A, B, or C above and is not subject to a quantitative
restriction in the importing NAFTA country because it is a
\`\`qualifying good\'\' as defined in Annex 703.2, Section A or B
(please specify). A good listed in Appendix 703.2.B.7 is also exempt
from quantitative restrictions and is eligible for NAFTA preferential
tariff treatment if it meets the definition of \`\`qualifying good\'\'
in Section A of Annex 703.2. NOTE 1: This criterion does not apply to
goods that wholly originate in Canada or the United States and are
imported into either country. NOTE 2: A tariff rate quota is not a
quantitative restriction.\
Field 8: For each good described in field #5, state \`\`YES\'\' if you
are the producer of the good. If you are not the producer of the good,
state \`\`NO\'\' followed by (1), (2) or (3), depending on whether this
certificate was based upon: (1) your knowledge of whether the good
qualifies as an originating good; (2) your reliance on the producer\'s
written representation (other than a Certificate of Origin) that the
good qualifies as an originating good; or (3) a completed and signed
Certificate for the good, voluntarily provided to the exporter by the
producer.\
Field 9: For each good described in field #5, where the good is subject
to a regional value content (RVC) requirement, indicate \`\`NC\'\' if
the RVC is calculated according to the net cost method; otherwise,
indicate \`\`NO\'\'. If the RVC is calculated according to the net cost
method over a period of time, further identify the beginning and ending
date (DD/MM/YR) of that period. (Reference: Articles 402.1, and 402.5)\
Field 10: Identify the name of the country (\`\`MX\'\' or \`\`US\'\' for
agricultural and textile goods exported to Canada; \`\`US\'\' or
\`\`CA\'\' for all goods exported to Mexico; or \`\`CA\'\' or \`\`MX\'\'
for all goods exported to the United States) to which the preferential
rate of customs duty applies, as set our in Annex 302.2, in accordance
with the Marketing Rules or in each Party\'s schedule of tariff
elimination.\
For all other originating goods exported to Canada, indicate
appropriately \`\`MX\'\' or \`\`US\'\' if the goods originate in that
NAFTA country, within the meaning of the NAFTA Rules of Origin
Regulations,, and any subsequent processing in the other NAFTA country
does not increase the transaction value of the goods by more than seven
percent; otherwise indicate \`\`JNT\'\' for joint production.
(Reference: Annex 302.2).\
Field 11: This field must be completed, signed and dated by the
exporter. When the Certificate is completed by the producer for use by
the exporter, it must be completed, signed and dated by the producer.
The date must be the date the Certificate was completed and signed.\
\
Annex I.1d\
\
Language of a Party\
\
For purposes of these Uniform Regulations the language of a Party shall
be, in the case of:\
(a) Canada, English or French;\
(b) Mexico, Spanish; and\
(c) the United States, English.\
\
\
Annex II.3\
\
Corrected Declaration of Origin\
\
An importer shall not be subject to penalties if, in the case of:\
(a) Canada, the importer makes the corrected declaration within ninety
days from the date on which the importer has reason to believe that the
declaration is incorrect;\
(b) Mexico, the importer makes the corrected declaration before the
customs administration begins an investigation regarding an incorrect
declaration or initiates the exercise of its auditing powers on the
accuracy of a declaration or an inspection pursuant to the application
of the random selection procedures; and\
(c) United States, the importer makes the corrected declaration within
thirty days from the date on which the importer has reason to believe
that the declaration is incorrect and such corrected declaration is make
before the commencement of a formal investigation of the incorrect
declaration.\
\
\
Annex III.2\
\
Country-Specific Definitions of \`\`Series of Importations\'\'\
\
For purposes of Article 503 of the Agreement, \`\`series of
importations\'\' means, in the case of:\
(a) Canada, two or more importations of a good accounted for separately
but covered by one commercial invoice issued by the seller of the good
to the purchaser of the good;\
(b) Mexico, two or more customs entries covering a good arriving the
same day or released the same day, and consigned to, or imported by any
person, but covered by one commercial invoice; and\
(c) the United States, two or more customs entries covering a good
arriving the same day from the same exporter and consigned to the same
person.\
\
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\
Annex IV.1\
\
Country-Specific Definitions of \`\`Promptly\'\'\
\
For purposes of Article 504(1)(b) of the Agreement, \`\`promptly\'\'
means, in the case of:\
(a) Canada, immediately;\
(b) Mexico, prior to the commencement of an investigation by officials
with authority to conduct criminal investigations regarding the
Certificate of Origin; and\
(c) the United States, within 30 days.\
\
\
Annex VI.9\
\
Common Standards for Written Questionnaires\
1. For purposes of Article VI.9 of these Uniform Regulations, the
Parties will seek to agree on uniform questions to be included in a
general questionnaire.\
2. Subject to paragraph 3, where the customs administration of a Party
conducts a verification under Article 506(1)(a) of the Agreement, it
shall send the general questionnaire referred to in paragraph 1 of this
Annex.\
3. For purposes of Article 506(1)(a) of the Agreement, where the customs
administration of a Party requires specific information not reflected in
the general questionnaire, it may send a more specific questionnaire,
according to the information required to determine whether the good that
is the subject of the verification is an originating good.\
4. For purposes of Article VI of these Uniform Regulations, the
verification questionnaires may, at the option of the exporter or
producer, be completed in either the language of the Party into whose
territory the good is imported, or the language of the Party in the
territory in which the exporter or producer is located.\
5. Nothing in this Annex shall be interpreted to constrain the customs
administration of a Party from requesting additional information in
accordance with Article 506(1)(a) of the Agreement and these Uniform
Regulations.\
\
\
Annex VI.23\
\
Rulings and Advance Rulings\
\
A person shall be entitled to rely on a ruling or advance ruling that is
issued, in the case of:\
(a) Canada, in accordance with Departmental Memorandum 11-11-1 (National
Customs Rulings) or pursuant to section 43.1(1) of the Customs Act
(Advance Rulings);\
(b) Mexico, pursuant to Article 34 of the Codigo Fiscal de la Federacion
and to Article 30 of the Ley Aduanera or the applicable provision of
Mexican law related to advance rulings under Article 509 of the
Agreement; and\
(c) the United States, pursuant to 5 U.S.C. 301, 19 U.S.C. 66, or 19
U.S.C. 1624.\
\
Annex VII.2\
\
Common Standards for Information Required in the Application for an
Advance Ruling\
\
1. For purposes of Article 509(2) of the Agreement, each Party shall
provide that a request for an advance ruling shall contain:\
(a) the name and address of the exporter, producer or importer of the
good requesting the issuance of the ruling, as the case may be,
hereinafter referred to as the applicant,\
(b) where the applicant is\
(i) the exporter of the good, the name and address of the producer and
importer of the good, if known,\
(ii) the producer of the good, the name and address of the exporter and
importer of the good, if known, or\
(iii) the importer of the good, the name and address of the exporter
and, if known, the producer of the good.\
(c) where the request is made on behalf of an applicant, the name and
address of the person requesting the issuance of the advance ruling and
either\
(i) a written statement from the person requesting the issuance of the
advance ruling, or\
(ii) upon the request of the customs administration of that Party, such
person provide, in accordance with its laws, evidence from the applicant
on whose behalf the ruling is being requested, that indicates that the
person is duly authorized to transact business as the agent of the
applicant.\
(d) a statement, on the basis of the applicant\'s knowledge, as to
whether the issue that is the subject of the request for an advance
ruling is, or has been, the subject of\
(i) a verification of origin\
(ii) an administrative review or appeal\
(iii) a judicial or quasi-judicial review, or\
(iv) a request for an advance ruling\
in the territory of any Party, and if so, a brief statement setting
forth the status or disposition of the matter.\
(e) a statement, on the basis of the applicant\'s knowledge, as to
whether the good that is the subject of the request for an advance
ruling has previously been imported into the territory of the Party to
whom the request for the advance ruling has been made.\
(f) a statement that the information presented is accurate and complete,
and\
(g) a complete description of all relevant facts and circumstances
relating to the issue that is the subject of the request for the advance
ruling, including,\
(i) a concise statement, within the scope of Article 509(1) of the
Agreement, setting forth the issue on which the advance ruling is
sought, and\
(ii) a general description of the good.\
2. Where relevant to the issue that is the subject of the request for an
advance ruling, the request shall include, in addition to the
information referred to in paragraph 1,\
(a) a copy of any advance ruling or other ruling with respect to the
tariff classification of the good that has been issued to the applicant
by the Party to whom the request for an advance ruling is made, and\
(b) if no previous advance ruling or other ruling with respect to the
tariff classification of the good has been issued by the Party to whom
the request for the advance ruling is made, sufficient information to
enable the customs administration of that Party to classify the good,
including,\
(i) a full description of the good, including, where relevant, the
composition of the good, a description of the process by which the good
is manufactured, a description of the packaging in which the good is
contained, the anticipated use of the good and its commercial, common or
technical designation, product literature, drawings, photographs, or
schematics, and\
(ii) where practical and useful, a sample of the good.\
3. Where the request for the advance ruling involves the application of
a rule of origin that requires an assessment of whether materials used
in the production of the good undergo an applicable change in tariff
classification, the request shall include:\
(a) a listing of each material that is used in the production of the
good,\
(b) with respect to each material referred to in paragraph (a) that is
claimed to be an originating material, a complete description of the
material, including the basis on which it is considered that the
material originates,\
(c) with respect to each material referred to in paragraph (a) that is a
non-originating material or the origin of which is unknown, a complete
description of the material, including its tariff classification, if
known, and\
(d) a description of all processing operations employed in the
production of the good, the location of each operation and the sequence
in which the operations occur.\
4. Where the request for an advance ruling involves the application of a
regional value-content requirement, the applicant shall indicate whether
the request is based on the use of the transaction value or the net cost
method, or both.\
5. Where the request for an advance ruling involves the use of the
transaction value method, the request shall include:\
(a) information sufficient to calculate the transaction value of the
good in accordance with Schedule II of the NAFTA Rules of Origin
Regulations with respect to the transaction of the producer of the good,
adjusted to a F.O.B. basis,\
(b) information sufficient to calculate the value of each material that
is a non-originating material or the origin of which is unknown that is
used in the production of the good in accordance with Section 7, and,
where applicable, section 6(10) of the NAFTA Rules of Origin
Regulations, and\
(c) with respect to each material that is claimed to be an originating
material that is used in the production of the good, a complete
description of the material including the basis on which it is
considered that the material originates.\
6. Where the request for an advance ruling involves the use of the net
cost method, the request shall include:\
(a) a listing of all product, period and other costs relevant to
determining the total cost of the good referred to under the NAFTA Rules
of Origin Regulations,\
(b) a listing of all excluded costs to be subtracted from the total cost
referred to under the NAFTA Rules of Origin Regulations,\
(c) information sufficient to calculate the value of each material that
is a non-originating material or the origin of which is unknown that is
used in the production of the good in accordance with section 7 of the
NAFTA Rules of Origin Regulation,\
(d) the basis for any allocation of costs in accordance with Schedule
VII of the NAFTA Rules of Origin Regulations, and\
(e) the period over which the net cost calculation is to be made.\
7. Where the request for an advance ruling involves an issue of whether,
with respect to a good or a material that is used in the production of a
good, the transaction value of the good or the material is acceptable,
the request shall include information sufficient to permit an
examination of the factors enumerated in Schedules III or VIII of the
NAFTA Rules of Origin Regulations, as applicable.\
8. Where the request for an advance ruling involves an issue with
respect to an intermediate material under Article 402(10) of the
Agreement, the request shall contain sufficient information to determine
the origin and value of the material in accordance with Article
402(11).\
9. Where the request for an advance ruling is limited to the calculation
of an element of a regional value content formula, in addition to the
information required under paragraph 1, only that information set out
under paragraph 4, 5 and 6 which is relevant to the issue that is the
subject of the request for an advance ruling need be contained in the
request.\
10. Where the request for an advance ruling is limited to the origin of
a material that is used in the production of a good in accordance with
Article VII.1 of these Uniform Regulations, in addition to the
information required under paragraph 1, only that information set out
under paragraph 2 and 3 which is relevant to the issue that is the
subject of the advance ruling need be contained in the request.\
\
Annex VII.8\
\
Country-Specific Definitions of \`\`importations of a good\'\'\
\
For purposes of Article 509(7) of the Agreement, \`\`importations of a
good\'\' means importations of a good:\
(a) which, in the case of Canada, has been released pursuant to section
31 of the Customs Act;\
(b) for which, in the case of Mexico, an entry document has been
presented pursuant to Article 25 of the Ley Aduanera (Customs Act); and\
(c) which, in the case of the United States, has been entered pursuant
to section 1484 of title 19, United States Code.\
\
Annex IX.1\
\
United States Definition of \`\`identical or similar\'\'\
\
For purposes of Article 303 of the Agreement, in the case of the United
States \`\`identical or similar\'\' shall have the same meaning as
\`\`same kind and quality\'\' as set forth in 19 U.S.C. Sec. 1313(b).\
\[FR Doc. 95-21717 Filed 9-5-95; 8:45 am\]\
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