Also called CUSMA, USMCA, ACEUM, certificate of origin, regional value content, CETA
What are rules of origin?
The test that decides whether your product counts as Canadian, and therefore whether it crosses a border duty-free.
What else it is called
- Other names
- CUSMA, USMCA, ACEUM, certificate of origin, regional value content, CETA
- In French
- règles d’origine
Related entries
Understanding rules of origin
The test that decides whether a product qualifies as originating for the purposes of a trade agreement, and therefore whether it enters duty-free. Under the Canada-United States-Mexico Agreement, and under Canada’s agreements with Europe and the Pacific, qualification generally runs one of two ways: a change in tariff classification, meaning the inputs were transformed enough to be classified differently from the finished product, or a regional value content calculation, meaning enough of the value was added within the region. Automotive rules are stricter and include labour value content requirements.
The practical work is documentary rather than analytical. You certify origin, and the certification is only as sound as the supplier declarations beneath it. One imported component reclassified, or one supplier who cannot substantiate their own declaration, can put a whole product offside - and because reassessment comes years later, the exposure accumulates quietly.
Records supporting a claim must be kept for six years in Canada. Keeping them in a form somebody could actually reconstruct is the part that gets skipped.
In practice
A certification of origin is only as good as the supplier declarations under it. One imported component reclassified can put a whole product offside, and the reassessment arrives years later.
Frequently asked
Does assembling in Canada make a product Canadian?
Not by itself. Assembly from imported components may or may not produce the required change in tariff classification, and simple operations - packaging, labelling, minor finishing - are explicitly insufficient under most agreements. The test is product-specific and has to be checked against the rule for your classification.
Who completes the certification of origin?
Under the Canada-United States-Mexico Agreement the exporter, producer or importer may certify, and whoever does carries the responsibility for substantiating it. If you certify as producer, you are warranting the supplier declarations beneath you as well.
How long do we keep origin records?
Six years in Canada, and that means the supporting cost and sourcing data, not just the certificate. Verification requests arrive long after the shipment and are answered from these records or not at all.