CUSMA Rules of Origin Regulations — 7
d, if the producer elects to do so, by (a) calculating the sum of the net costs incurred and the sum of the values of non-originating materials used by the producer of the good with respect to the good and identical goods or similar goods, or any combination thereof, produced in a single plant by the producer over (i) a one-month period, (ii) any consecutive three- or six-month period that falls within and is evenly divisible into the number of months of the producer’s fiscal year remaining at the beginning of that period, or (iii) the producer’s fiscal year; and (b) using the sums referred to in paragraph (a) as the net cost and the value of non-originating materials, respectively. Application (16) The calculation made under subsection (15) applies with respect to all units of the good produced during the period chosen by the producer under paragraph (15)(a). No change to goods or period (17) An election made under subsection (15) may not be rescinded or modified with respect to the goods or the period to which the election is made. Period considered to be chosen (18) If a producer chooses a one-, three- or six-month period under subsection (15) with respect to a good, the producer is considered to have chosen under that subsection a period or periods of the same duration for the remainder of the producer’s fiscal year with respect to that good. Method and period for remainder of fiscal year (19) If the use of the net cost method is required or chosen and an election is made under subsection (15), the regional value content of the good is to be calculated on the basis of the net cost method over the period chosen under that subsection and for the remainder of the producer’s fiscal year. Analysis of actual cost (20) Except as otherwise provided in subsection 16 (9), if the producer of a good has calculated the regional value content of the good under the net cost method on the basis of estimated costs, including standard costs, budgeted forecasts or other similar estimating procedures, before or during the period chosen under paragraph (15)(a), the producer must conduct an analysis at the end of the producer’s fiscal year of the actual costs incurred over the period with respect to the production of the good. Option to treat any material as non-originating (21) For the purpose of calculating the regional value content of a good, the producer of that good may choose to treat any material used in the production of that good as a non-originating material. Examples (22) Each of the following examples is an “Example” as referred to in subsection 1 (4). Example 1: Point of direct shipment (with respect to the definition adjusted to exclude any costs incurred in the international shipment of the good ) A producer has only one factory at which the producer manufactures office chairs. Because the factory is located close to transportation facilities, all units of the finished good are stored in a factory warehouse 200 m from the end of the production line. Goods are shipped worldwide from this warehouse. The point of direct shipment is the warehouse. Example 2: Point of direct shipment (with respect to the definition adjusted to exclude any costs incurred in the international shipment of the good ) A producer has six factories, all located within the territory of one of the CUSMA countries, at which the producer produces garden tools of various types. These tools are shipped worldwide and orders usually consist of bulk orders of various types of tools. Because different tools are manufactured at different factories, the producer decided to consolidate storage and shipping facilities and ships all finished products to a large warehouse located near the seaport from which all orders are shipped. The distance from the factories to the warehouse varies from 3 km to 130 km. The point of direct shipment for each of the goods is the warehouse. Example 3: Point of direct shipment (with respect to the definition adjusted to exclude any costs in