What is CUSMA / USMCA / T-MEC?
CUSMA, also referred to as USMCA or T-MEC, is a free trade agreement between Canada, the United States, and Mexico that came into effect as of July 1st, 2020. Rather than being viewed as a wholly new agreement, it has been characterized as NAFTA 2.0.
Download our quick reference guide, 10 Things You Need To Know About CUSMA:
We hosted a webinar that goes over all the most importance changes that will come into effect with CUSMA.
What has changed from NAFTA?
New Certificate of Origin
A new certificate will be required as of July 1, 2020. Both electronic and digital signatures will be acceptable.
Audits and Claims
Be sure to retain documentation for 6 years. Claims can be made for 4 years from date of import into Canada.
The de minimis threshold has increased to $150 for duties, and $40 for sales tax into Canada. The U.S. rate will remain the same at $800.
There is an increase from 8 to 10 years of the time that a pharmaceutical company can maintain a patent on biologics. Copyright terms were also extended from 50 years after the death of an author to 70 years.
Industries Most Affected
Both the auto and agricultural sectors will be most affected by the new Agreement.
Certificate of Origin
Q: Should we use the Certificate of Origin form if we are shipping goods from China to the United States?
A: Certification and the Certificate of Origin form is for use only with origin countries including Canada, the United States, and Mexico.
Q: Are Tax ID numbers no longer required for exports to the USA?
A: A Tax ID number is no longer a requirement for certification. There is still a requirement for the entry filing.
Q: Most of the products we produce in Canada are not currently covered by NAFTA, and we use TPL to send it across the border. Does this mean that we do not need to use the new CUSMA Certificate of Origin form?
A: If you are not shipping products that are currently covered by NAFTA, you will also not require CUSMA certification.
Q: On the NAFTA certificate, if I currently sign as the Authorized Person, how does that differ from the Certifier box on the new CUSMA certificate?
A: Under CUSMA, the Certifier can now be someone other than the exporter. In this instance, nothing will change.
Q: Can we use the descriptions and previous tariff codes that we used under NAFTA for exporting under CUSMA?
A: You can still use the descriptions and previous tariff codes that were used under NAFTA when you certify goods under CUSMA.
Q: We are located in Canada and purchase textbooks from book publishers located in the United States. Will CUSMA affect us?
A: Textbooks remain duty free. There is no need for certification.
Q: Are there any changes under CUSMA to duty rates?
A: If a good is currently duty-free under NAFTA, then it will be duty free under the CUSMA agreement.
Q: Some of our products are made in another country and then shipped to the United States for packaging. Would this change the country of origin?
A: The location for packaging of goods would not constitute a change to country of origin.
Q: What changes are there for fashion?
A: There are lots! We hosted a webinar specifically for members of the apparel industry on June 4, in partnership with CAF. Click here to download the recording.
Q: Do I still need to do a B13A when shipping to Mexico?
A: B13 declarations will still be required under the new agreement.
Q: We import merchandise to sell in our store, plus hops and yeast for our beers. What changes for us under CUSMA?
A: New certificates will need to be obtained from your vendor for anything imported on or after July 1, 2020. Carson is also able to do this on your behalf.
Q: We receive shipments of goods from the United States and Mexico. Do we as the receiver of these goods need to fill out the Certificate of Origin form?
A: It’s best to request that your vendors to fill out the Certificate of Origin form. CUSMA permits the importer to complete the certification, only if they have all the information required to qualify the goods under the new Agreement.