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Canada-United States-Mexico Agreement (CUSMA) - Chapter 2 - National Treatment and Market Access for Goods

Article 2.1: Definitions

For the purposes of this Chapter:

advertising films and recordings means recorded visual media or audio materials that exhibit for prospective customers the nature or operation of goods or services offered for sale or lease by a person established or resident in the territory of a Party, provided that the films and recordings are not for broadcast to the general public;

commercial samples of negligible value means commercial samples having a value, individually or in the aggregate as shipped, of not more than one U.S. dollar, or the equivalent amount in the currency of another Party, or so marked, torn, perforated, or otherwise treated that they are unsuitable for sale or use except as commercial samples;

consular transactions means requirements that goods of a Party intended for export to the territory of another Party must first be submitted to the supervision of the consul of the importing Party in the territory of the exporting Party, or in the territory of a non-Party, for the purpose of obtaining a consular invoice or a consular visa for a commercial invoice, certificate of origin, manifest, shipper’s export declaration, or any other customs documentation in connection with the importation of the good;

consumed means:

distributor means a person of a Party who is responsible for the commercial distribution, agency, concession, or representation in the territory of the Party of goods of another Party;

duty-free means free of customs duty;

goods admitted for sports purposes means sports requisites admitted into the territory of the importing Party for use in sports contests, demonstrations, or training in the territory of the Party;

import licensing means an administrative procedure requiring the submission of an application or other documentation (other than that generally required for customs clearance purposes) to the relevant administrative body as a prior condition for importation into the territory of the importing Party;

Import Licensing Agreement means the Agreement on Import Licensing Procedures, set out in Annex 1A to the WTO Agreement;

performance requirement means a requirement that:

but does not include a requirement that an imported good be:

printed advertising materials means those goods classified in Chapter 49 of the Harmonized System, including brochures, pamphlets, leaflets, trade catalogues, yearbooks published by trade associations, tourist promotional materials, and posters, that are used to promote, publicize, or advertise a good or service, are essentially intended to advertise a good or service, and are supplied free of charge;

satisfactory evidence means:

used vehicle means an automobile, a truck, a bus, or a special purpose motor vehicle, not including a motorcycle, that:

Article 2.2: Scope

Except as otherwise provided in this Agreement, this Chapter applies to trade in goods of a Party.

Article 2.3: National Treatment

1. Each Party shall accord national treatment to the goods of another Party in accordance with Article III of the GATT 1994, including its interpretative notes, and to this end, Article III of the GATT 1994 and its interpretative notes are incorporated into and made part of this Agreement, mutatis mutandis.

2. The treatment to be accorded by a Party under paragraph 1 means, with respect to a regional level of government, treatment no less favorable than the most favorable treatment that regional level of government accords to any like, directly competitive, or substitutable goods, as the case may be, of the Party of which it forms a part.

3. Paragraphs 1 and 2 do not apply to the measures set out in Annex 2-A (Exceptions to Article 2.3 (National Treatment) and Article 2.11 (Import and Export Restrictions)).

Article 2.4: Treatment of Customs Duties

1. Unless otherwise provided in this Agreement, no Party shall increase any existing customs duty, or adopt any new customs duty, on an originating good.

2. Unless otherwise provided in this Agreement, each Party shall apply a customs duty on an originating good in accordance with its Schedule to Annex 2-B (Tariff Commitments).

3. On the request of a Party, the Parties shall consult to consider accelerating or broadening the scope of the elimination of customs duties set out in their Schedules to Annex 2-B (Tariff Commitments). An agreement between two or more Parties to accelerate or broaden the scope of the elimination of a customs duty on an originating good shall supersede any customs duty rate determined pursuant to those Parties’ Schedules to Annex 2-B (Tariff Commitments) for that good once approved by each Party in accordance with its applicable legal procedures.

4. A Party may at any time unilaterally accelerate the elimination of customs duties set out in its Schedule to Annex 2-B (Tariff Commitments) on originating goods.

5. Annex 2-C (Provisions Between Mexico and the United States on Automotive Goods) contains additional provisions between Mexico and the United States relating to customs duties on automotive goods that are not originating under Chapter 4 (Rules of Origin).

Article 2.5: Drawback and Duty Deferral Programs

1. Except as otherwise provided in this Article, no Party shall refund the amount of customs duties paid, or waive or reduce the amount of customs duties owed, on a good imported into its territory, on condition that the good is:

in an amount that exceeds the lesser of the total amount of customs duties paid or owed on the good on importation into its territory and 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.

2. No Party shall, on condition of export, refund, waive, or reduce:

3. If a good is imported into the territory of a Party pursuant to a duty deferral program and is subsequently exported to the territory of another Party, or is used as a material in the production of another good that is subsequently exported to the territory of another Party, or is substituted by an identical or similar good used as a material in the production of another good that is subsequently exported to the territory of another Party, the Party from whose territory the good is exported:

4. In determining the amount of a customs duty that may be refunded, waived, or reduced pursuant to paragraph 1 on a good imported into its territory, each Party shall require presentation of satisfactory evidence of the amount of customs duties paid to another Party on the good that has been subsequently exported to the territory of that other Party.

5. If satisfactory evidence of the customs duty paid to the Party to which a good is subsequently exported under a duty deferral program described in paragraph 3 is not presented within 60 days after the date of exportation, the Party from whose territory the good was exported:

6. This Article does not apply to:

7. For the purposes of this Article:

identical or similar goods means “identical goods” and “similar goods,” respectively, as defined in the Customs Valuation Agreement, or as otherwise provided for under the law of the importing Party;

material means “material” as defined in Article 4.1 (Definitions);

used means “used” as defined in Article 4.1 (Definitions).

8. If a good referred to by a tariff item number in this Article is described in parentheses following the tariff item number, the description is provided for purposes of reference only.

Article 2.6: Waiver of Customs Duties

No Party shall adopt or maintain any waiver of a customs duty if the waiver is conditioned, explicitly or implicitly, on the fulfillment of a performance requirement.

Article 2.7: Temporary Admission of Goods

1. Each Party shall grant duty-free temporary admission for:

admitted from the territory of another Party, regardless of their origin and regardless of whether like, directly competitive, or substitutable goods are available in the territory of the Party.

2. No Party shall condition the duty-free temporary admission of a good referred to in paragraph 1, other than to require that the good:

3. Subject to its law, each Party shall extend the time limit for temporary admission beyond the period initially fixed at the request of the person concerned.

4. Each Party shall adopt or maintain procedures providing for the expeditious release of a good admitted under this Article. To the extent possible, those procedures must provide that when such a good accompanies a national of another Party who is seeking temporary entry, the good shall be released simultaneously with the entry of that national.

5. Each Party shall permit a good temporarily admitted under this Article to be exported through a customs port other than the port through which it was admitted.

6. Each Party shall provide, in accordance with its law, that the person responsible for a good admitted under this Article shall not be liable for failure to export the good upon presentation of proof satisfactory to the Party into whose territory the good was admitted that the good has been destroyed within the original time period fixed for temporary admission or any lawful extension.

7. If any condition that a Party imposes under paragraph 2 has not been fulfilled, the Party may apply the customs duty and any other charge that would normally be owed on entry or importation of the good in addition to any other charges or penalties provided for under its law.

8. Subject to Chapters 14 (Investment) and Chapter 15 (Cross Border Trade in Services):

9. For the purposes of paragraph 8, vehicle means a truck, a truck tractor, a tractor, a trailer unit or trailer, a locomotive, or a railway car or other railroad equipment, if used in international traffic.

10. Each Party shall adopt or maintain procedures allowing for the arrival and release from customs custody, such as through a procedure that provides for temporary admission as set forth in this Article, of a shipping container or other substantial holder being used or to be used in the shipment of goods in international traffic, whether arriving full or empty and of any size, volume, or dimension, with relief from custom duties and allowing it to remain within its territory for at least 90 consecutive days.

11. Each Party shall, in accordance with its laws, regulations, and procedures, extend the timeframe for temporary admission of a shipping container or other substantial holder beyond the period initially fixed at the request of the person concerned.

12. A Party may require that a shipping container or other substantial holder be registered with the customs authority the first time it arrives in its territory, as a condition for the treatment described in paragraphs 10 and 11.

13. Each Party shall include in the treatment of any shipping container or other substantial holder that has an internal volume of one cubic meter or more, the accessories or equipment accompanying it as defined by the importing Party.

14. For the purposes of paragraph 8 and paragraphs 10 through 13, a “shipping container or other substantial holder” includes any container or holder, whether collapsible or not, that is constructed of a sturdy material capable of repeated use, and is used in the shipment of goods in international traffic.

Article 2.8: Goods Re-Entered after Repair or Alteration

1. No Party shall apply a customs duty to a good, regardless of its origin, that re-enters its territory after that good has been temporarily exported from its territory to the territory of another Party for repair or alteration, regardless of whether that repair or alteration could have been performed in the territory of the Party from which the good was exported for repair or alteration or has increased the value of the good.

2. Paragraph 1 does not apply to a good imported under a duty deferral program that is exported for repair or alteration and is not re-imported under a duty deferral program.

3. Notwithstanding Article 2.5 (Drawback and Duty Deferral Programs), no Party shall apply a customs duty to a good, regardless of its origin, admitted temporarily from the territory of another Party for repair or alteration.

4. For the purposes of this Article, repair or alteration does not include an operation or process that:

Article 2.9: Duty-Free Entry of Commercial Samples of Negligible Value and Printed Advertising Materials

No Party shall apply a customs duty to commercial samples of negligible value or to printed advertising materials imported from the territory of another Party, regardless of their origin, but a Party may require that:

Article 2.10: Most-Favored-Nation Rates of Duty on Certain Goods

1. Each Party shall accord most-favored-nation duty-free treatment to a good provided for under the tariff provisions set out in Tables 2.10.1, 2.10.2, and 2.10.3.

Notwithstanding Chapter 4 (Rules of Origin), each Party shall consider a good set out in Table 2.10.1, if imported into its territory from the territory of another Party, to be an originating good.

Table 2.10.1
A. Automatic Data Processing Machines (ADP)
8471.30
8471.41
8471.49
B. Digital Processing Units
8471.50
C. Input or Output Units
Combined Input/Output Units
Canada8471.60.00
Mexico8471.60.02
United States8471.60.10
Display Units
Canada8528.42.00
8528.52.00
8528.62.00
Mexico8528.41.99
8528.51.01
8528.51.99
8528.61.01
United States8528.42.00
8528.52.00
8528.62.00
Other Input or Output Units
Canada8471.60.00
Mexico8471.60.03
8471.60.99
United States8471.60.20
8471.60.70
8471.60.80
8471.60.90
D. Storage Units
8471.70
E. Other Units of Automatic Data Processing Machines
8471.80
F. Parts of Computers
8443.99parts of machines of subheading 8443.31 and 8443.32, excluding facsimile machines and teleprinters
8473.30parts of ADP machines and units thereof
8517.70parts of LAN equipment of subheading 8517.62
Canada8529.90.19
8529.90.50
8529.90.90
parts of monitors and projectors of subheading 8528.42, 8528.52, and 8528.62
Mexico8529.90.01
8529.90.06
parts of monitors or projectors of subheadings 8528.41, 8528.51, and 8528.61
United States8529.90.22
8529.90.75
8529.90.99
parts of monitors and projectors of subheading 8528.42, 8528.52, and 8528.62
G. Computer Power Supplies
Canada8504.40.30
8504.40.90
8504.90.10
8504.90.20
8504.90.90
Mexico8504.40.12
8504.40.14
8504.90.02
8504.90.07
8504.90.08
parts of goods classified in tariff item 8504.40.12
United States8504.40.60
8504.40.70
8504.90.20
8504.90.41
Table 2.10.2
A. Metal Oxide Varistors
Canada8533.40.00
Mexico8533.40.05
United States8533.40.40
B. Diodes, Transistors and Similar Semiconductor Devices; Photosensitive Semiconductor Devices; Light Emitting Diodes; Mounted Piezo-electric Crystals
8541.10
8541.21
8541.29
8541.30
8541.50
8541.60
8541.90
Canada8541.40
Mexico8541.40.01
8541.40.02
8541.40.03
United States8541.40.20
8541.40.60
8541.40.70
8541.40.80
8541.40.95
C. Electronic Integrated Circuits and Microassemblies
8542
Canada8548.90.00
Mexico8548.90.04
United States8548.90.01
Table 2.10.3
Local Area Network (LAN) Apparatus
Canada8517.62.00
Mexico8517.62.01
United States8517.62.00

Article 2.11: Import and Export Restrictions

1. Except as otherwise provided in this Agreement, no Party shall adopt or maintain any prohibition or restriction on the importation of any good of another Party or on the exportation or sale for export of any good destined for the territory of another Party, except in accordance with Article XI of the GATT 1994, including its interpretative notes, and to this end Article XI of the GATT 1994 and its interpretative notes are incorporated into and made a part of this Agreement, mutatis mutandis.

The Parties understand that GATT 1994 rights and obligations incorporated by paragraph 1 prohibit, in any circumstances in which any other form of restriction is prohibited, a Party from adopting or maintaining:

3. If a Party adopts or maintains a prohibition or restriction on the importation from or exportation to a non-Party of a good, nothing in this Agreement shall be construed to prevent that Party from:

4. If a Party adopts or maintains a prohibition or restriction on the importation of a good from a non-Party, the Parties, on the request of a Party, shall consult with a view to avoiding undue interference with or distortion of pricing, marketing, or distribution arrangements in another Party.

5. No Party shall as a condition for engaging in importation generally, or for the importation of a particular good, require a person of another Party to establish or maintain a contractual or other relationship with a distributor in its territory.

6. For greater certainty, paragraph 5 does not prevent a Party from requiring that a person referred to in that paragraph designate a point of contact for the purpose of facilitating communications between its regulatory authorities and that person.

7. Paragraphs 1 through 6 do not apply to the measures set out in Annex 2-A (Exceptions to Article 2.3 (National Treatment) and Article 2.11 (Import and Export Restrictions)).

8. For greater certainty, paragraph 1 applies to the importation of any good implementing or incorporating cryptography, if the good is not designed or modified specifically for government use and is sold or otherwise made available to the public.

9. For greater certainty, no Party shall adopt or maintain a prohibition or restriction on the importation of originating used vehicles from the territory of another Party. This Article does not prevent a Party from applying motor vehicle safety or emissions measures, or vehicle registration requirements, of general application to originating used vehicles in a manner consistent with this Agreement.

Article 2.12: Remanufactured Goods

1. For greater certainty, Article 2.11.1 (Import and Export Restrictions) applies to prohibitions and restrictions on a remanufactured good.

2. Subject to its obligations under this Agreement and the WTO Agreement, a Party may require that a remanufactured good:

3. If a Party adopts or maintains a prohibition or a restriction on a used good, it shall not apply the measure to a remanufactured good.

Article 2.13: Transparency in Import Licensing Procedures

1. Subject to paragraph 2, each Party shall notify the other Parties of its existing import licensing procedures, if any, as soon as practicable, after this Agreement enters into force. The notification shall:

2. A Party shall be deemed to be in compliance with the obligations in paragraph 1 with respect to an import licensing procedure if:

3. A Party shall publish on an official government website any new or modified import licensing procedure, including any information that it is required to be published under Article 1.4(a) of the Import Licensing Agreement. To the extent possible, the Party shall do so at least 20 days before the new procedure or modification takes effect.

4. Each Party shall respond within 60 days to a reasonable inquiry from another Party concerning its licensing rules and its procedures for the submission of an application for an import license, including the eligibility of persons, firms, and institutions to make an application, any administrative body to be approached, and the list of products subject to the licensing requirement.

5. If a Party denies an import license application with respect to a good of another Party, it shall, on request of the applicant and within a reasonable period after receiving the request, provide the applicant with a written explanation of the reason for the denial.

6. No Party shall apply an import licensing procedure to a good of another Party unless the Party has complied with the requirements of paragraphs 1 or 2, and 3, with respect to that procedure.

Article 2.14: Transparency in Export Licensing Procedures

1. Within 30 days after the date of entry into force of this Agreement, each Party shall notify the other Parties in writing of the publications in which its export licensing procedures, if any, are set out, including addresses of relevant government websites on which the procedures are published. Thereafter, each Party shall publish any new export licensing procedure, or any modification of an export licensing procedure, it adopts as soon as practicable but no later than 30 days after the new procedure or modification takes effect.

2. Each Party shall ensure that it includes in the publications it has notified under paragraph 1:

3. Each Party shall provide another Party, upon the other Party’s request and to the extent practicable, the following information regarding a particular export licensing procedure that it adopts or maintains, except when doing so would reveal business proprietary or other confidential information of a particular person:

4. This Article does not require a Party to grant an export license, or prevent a Party from implementing its obligations or commitments under United Nations Security Council Resolutions, as well as multilateral non-proliferation regimes, including: the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies; Nuclear Suppliers Group; the Australia Group; Convention on the Prohibition of the Development, Production, Stockpiling and Use of Chemical Weapons and on Their Destruction, done at Geneva, September 3, 1992, and signed at Paris, January 13, 1993; Convention on the Prohibition of the Development, Production and Stockpiling of Bacteriological (Biological) and Toxin Weapons and on Their Destruction, done at Washington, London, and Moscow, April 10, 1972; Treaty on the Non-Proliferation of Nuclear Weapons done at Washington, London, and Moscow, July 1, 1968; and the Missile Technology Control Regime.

5. For the purposes of this Article, export licensing procedure means a requirement that a Party adopts or maintains under which an exporter must, as a condition for exporting a good from the Party’s territory, submit an application or other documentation to an administrative body or bodies, but does not include customs documentation required in the normal course of trade or any requirement that must be fulfilled prior to introduction of the good into commerce within the Party’s territory.

Article 2.15: Export Duties, Taxes, or Other Charges

No Party shall adopt or maintain any duty, tax, or other charge on the export of any good to the territory of another Party, unless the duty, tax, or charge is also applied to the good if destined for domestic consumption.

Article 2.16: Administrative Fees and Formalities

1. Each Party shall ensure, in accordance with Article VIII:1 of the GATT 1994 and its interpretative notes, that all fees and charges of whatever character (other than customs duties, charges equivalent to an internal tax or other internal charges applied in a manner consistent with Article III:2 of the GATT 1994, and antidumping or countervailing duties) imposed on or in connection with importation or exportation are limited in amount to the approximate cost of services rendered and do not represent an indirect protection to a domestic good or a taxation of an import or export for fiscal purposes.

2. No Party shall require a consular transaction, including a related fee or charge, in connection with the importation of a good of another Party.Footnote 2

3. No Party shall adopt or maintain a customs user fee on an originating good.Footnote 3

Article 2.17: Committee on Trade in Goods

1. The Parties hereby establish a Committee on Trade in Goods (Goods Committee), comprising representatives of each Party.

2. The Goods Committee shall meet on the request of a Party or the Commission to consider any matter arising under this Chapter.

3. The Goods Committee shall meet at a venue and time as the Parties decide or by electronic means. In-person meetings will be held alternately in the territory of each Party.

4. The Goods Committee’s functions shall include:

ANNEX 2-A EXCEPTIONS TO ARTICLE 2.3 (NATIONAL TREATMENT) AND ARTICLE 2.11 (IMPORT AND EXPORT RESTRICTIONS)

Article 2.A.1: Application of Article 2.3 (National Treatment) and Article 2.11 (Import and Export Restrictions)

1. Article 2.3 (National Treatment) and Article 2.11 (Import and Export Restrictions) do not apply to the continuation, renewal, or amendment made to any law, statute, decree, or administrative regulation giving rise to a measure set out in the articles of this Annex to the extent that the continuation, renewal, or amendment does not decrease the conformity of the measure listed with Article 2.3 (National Treatment) and Article 2.11 (Import and Export Restrictions).

Article 2.3 (National Treatment) and Article 2.11 (Import and Export Restrictions) shall not apply to the import and export of rough diamonds (HS codes 7102.10, 7102.21, and 7102.31), pursuant to the Kimberley Process Certification Scheme and any subsequent amendments to that scheme.

Article 2.A.2: Measures of Canada

1. Article 2.3 (National Treatment) and Article 2.11 (Import and Export Restrictions) do not apply to:

2. Article 2.3 (National Treatment) and Article 2.11 (Import and Export Restrictions) do not apply to quantitative import restrictions on originating goods from the United States classified in tariff headings 89.01, 89.04, and 89.05, and tariff items 8902.00.10 and 8903.99.90 (of an overall length exceeding 9.2 m only) for as long as the measures adopted under the Merchant Marine Act of 1920 and Passenger Vessel Services Act and 46 U.S.C. §§ 12102, 12113, and 12116, apply with quantitative effect to comparable originating goods from Canada sold or offered for sale into the U.S. market.

Article 2.A.3: Measures of Mexico

1. Paragraphs 1 through 4 of Article 2.11 (Import and Export Restrictions) do not apply to:

Article 2.A.4: Measures of the United States

Article 2.3 (National Treatment) and Article 2.11 (Import and Export Restrictions) do not apply to:

ANNEX 2-B TARIFF COMMITMENTS

1. The rate of customs duty for an originating good under this Agreement is indicated in each Party’s Schedule to this Annex.

2. Except as otherwise provided in a Party’s Schedule to this Annex, and in accordance with Article 2.4 (Treatment of Customs Duties), the rate of customs duty on originating goods is designated with “0,” and these goods shall be duty-free on the date of entry into force of this Agreement.

3. For originating goods provided for in the items marked with an asterisk (*) in a Party’s Schedule to this Annex, the tariff treatment set forth in Appendix 1 to that Party’s Schedule applies.

TARIFF SCHEDULE OF CANADA GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of Canada’s Customs Tariff, and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of Canada’s Customs Tariff. To the extent that provisions of this Schedule are identical to the corresponding provisions of Canada’s Customs Tariff, the provisions of this Schedule shall have the same meaning as the corresponding provisions of Canada’s Customs Tariff.

2. This Schedule reflects Canada’s applied tariff nomenclature as at July 1, 2017, which is implemented in accordance with the Harmonized System (2017 edition), and includes all tariff items of Chapter 1 through 97 of the HS that provide for a Most-Favoured-Nation (MFN) rate of customs duty.

3. For the purpose of this Agreement, Canada’s Schedule is authentic in the English and French languages.

4. The base rates of customs duty for determining the interim staged rate of customs duty for a tariff item shall be those set out in Appendix 1 to this Schedule, which reflect Canada’s MFN rates of duty in effect on July 1, 2017.

5. In Appendix 1 to this Schedule, the following staging categories apply to the elimination or reduction of customs duties by Canada pursuant to Article 2.4:

6. For the purposes of Appendix 1 to this Schedule:

7. Interim staged rates for tariff items in Appendix 1 to this Schedule shall be rounded down at least to the nearest tenth of a percentage point or, if the rate of customs duty is expressed in monetary units, to the nearest tenth of one Canadian cent.

8 If Canada applies different preferential tariff treatment to other Parties for the same originating good in accordance with Canada’s Schedule to this Annex at the time a claim for preferential tariff treatment is made, Canada shall apply the rate of customs duty for the originating good of the Party where the last production process, other than a minimal operation, occurred.

9. For the purposes of paragraph 8, a minimal operation is:

10. Notwithstanding paragraph 8, if the good is produced in the first Party from originating materials produced in the second Party, Canada shall apply the rate of customs duty for the good of the first Party, provided that the good satisfies the applicable changes in tariff classification requirement set out in Table B-1 in the territory of the first Party or in Canada.

Table B-1
HS6Change in Tariff Classification Requirement
1701.12A change from any other chapter
1701.13A change from any other chapter
1701.91A change from any other chapter
1701.99A change from any other chapter
1702.90A change from any other chapter
1806.10A change from any other heading excluding from heading 17.01
2106.90A change from any other heading excluding from Chapter 17

TARIFF SCHEDULE OF MEXICO GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of Mexico’s Tariff Schedule of the General Import and Export Duties Law (Tarifa de la Ley de los Impuestos Generales de Importación y de Exportación (LIGIE)) and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of the LIGIE. To the extent that provisions of this Schedule are identical to the corresponding provisions of the LIGIE, the provisions of this Schedule shall have the same meaning as the corresponding provisions of the LIGIE.

2. This Schedule reflects Mexico’s applied tariff nomenclature as of September 1st, 2018, which is implemented in accordance with the Harmonized System (2012 edition), and includes all tariff items of Chapter 1 through 97 of the HS that provide for a Most-Favored-Nation (MFN) rate of customs duty.

3. In Appendix 1 to this Schedule, pursuant to Article 2.4, customs duties on originating goods provided for in the items denoted by “excluded” shall be subject to the applicable MFN tariff rates at the time of importation.

4. For an originating good provided for in a tariff item in Appendix 1 to this Schedule, Mexico shall apply a rate of customs duty no higher than zero, if:

TARIFF SCHEDULE OF THE UNITED STATES GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of the Harmonized Tariff Schedule of the United States (HTSUS), and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes, and Chapter Notes of the HTSUS. To the extent that provisions of this Schedule are identical to the corresponding provisions of the HTSUS, the provisions of this Schedule shall have the same meaning as the corresponding provisions of the HTSUS.

2. The base rates of duty set out in Appendix 1 to this Schedule reflect the United States’ Most-Favored-Nation (MFN) rates of duty in effect on July 1, 2017.

3. In Appendix 1 to this Schedule, the following staging categories apply to the elimination or reduction of customs duties by the United States pursuant to Article 2.4:

4. Interim staged rates for tariff items in Appendix 1 to this Schedule shall be rounded down to the nearest tenth of a percentage point or, if the rate of duty is expressed in monetary units, to the nearest tenth of one U.S. cent.

5. For the purposes of Appendix 1 to this Schedule, year one means the year this Agreement enters into force as provided in Article 34.5 (Final Provisions – Entry into Force).

6. For the purposes of Appendix 1 to this Schedule, beginning in year two, each annual stage of tariff reduction shall take effect on January 1 of the relevant year.

7. For an originating good provided for in a tariff item in Appendix 1 to this Schedule, if the United States applies different preferential treatment to one Party than to the other Party for that good:

Appendix 2: Tariff Schedule of Canada - (Tariff Rate Quotas)

Section A: General Provisions

1. Section B of this Appendix sets out the tariff rate quotas (TRQs) that Canada shall apply to certain originating goods of the United States under this Agreement. In particular, an originating good of the United States included under this Appendix shall be subject to the rates of duty set out in this Appendix instead of the rates of duty specified in Chapter 1 through Chapter 97 of the Schedule to Canada’s Customs Tariff. Notwithstanding any other provision of Canada’s Customs Tariff, originating goods under this Agreement in the quantities described in Section B of this Appendix shall be permitted entry into the territory of Canada as provided in this Appendix. Furthermore, unless specified otherwise in this Schedule, any quantity of originating goods imported from a Party under a TRQ provided for in Section B of this Appendix shall not be counted towards, or reduce the in-quota quantity, of any TRQ provided for such goods under Canada’s WTO tariff schedule or any other trade agreement.

2. Each good or group of goods covered by each TRQ set out in Section B is informally identified in the title to the paragraph setting out the TRQ. These titles are included solely to assist readers in understanding this Appendix and shall not alter or supersede the coverage established through identification of covered codes of Canada’s Customs Tariff.

3. Canada shall administer all TRQs provided for in this Agreement and set out in Section B of this Appendix according to the following provisions:

4. For the purposes of this Appendix, the term “metric tons” shall be abbreviated as “MT”.

Section B: TRQs

5. TRQ-CA1: Milk

Quota YearAggregate Quantity (MT)
18,333
216,667
325,000
433,333
541,667
650,000
750,500
851,005
951,515
1052,030
1152,551
1253,076
1353,607
1454,143
1554,684
1655,231
1755,783
1856,341
1956,905

6. TRQ-CA2: Cream

Quota YearAggregate Quantity (MT)
11,750
23,500
35,250
47,000
58,750
610,500
710,605
810,711
910,818
1010,926
1111,036
1211,146
1311,257
1411,370
1511,484
1611,599
1711,715
1811,832
1911,950

7. TRQ-CA3: Skim Milk Powder

Quota YearAggregate Quantity (MT)
11,250
22,500
33,750
45,000
56,250
67,500
77,575
87,651
97,727
107,805
117,883
127,961
138,041
148,121
158,203
168,285
178,368
188,451
198,536

8. TRQ-CA4: Butter and Cream Powder

Quota YearAggregate Quantity (MT)
1750
21,500
32,250
43,000
53,750
64,500
74,545
84,590
94,636
104,683
114,730
124,777
134,825
144,873
154,922
164,971
175,021
185,071
195,121

9. TRQ-CA5: Industrial Cheeses

Quota YearAggregate Quantity (MT)
11,042
22,083
33,125
44,167
55,208
66,250
76,313
86,376
96,439
106,504
116,569
126,635
136,701
146,768
156,836
166,904
176,973
187,043
197,113

10. TRQ-CA6: Cheeses of All Types

Quota YearAggregate Quantity (MT)
11,042
22,083
33,125
44,167
55,208
66,250
76,313
86,376
96,439
106,504
116,569
126,635
136,701
146,768
156,836
166,904
176,973
187,043
197,113

11. TRQ-CA7: Milk Powders

Quota YearAggregate Quantity (MT)
1115
2230
3345
4460
5575
6690
7697
8704
9711
10718
11725
12732
13740
14747
15755
16762
17770
18778
19785

12. TRQ-CA8: Concentrated or condensed milk

Quota YearAggregate Quantity (MT)
1230
2460
3690
4920
51,150
61,380
71,394
81,408
91,422
101,436
111,450
121,465
131,480
141,494
151,509
161,524
171,540
181,555
191,571

13. TRQ-CA9: Yogurt and Buttermilk

Quota YearAggregate Quantity (MT)
1689
21,378
32,068
42,757
53,446
64,135
74,176
84,218
94,260
104,303
114,346
124,389
134,433
144,478
154,522
164,568
174,613
184,659
194,706

14. TRQ-CA10: Powdered Buttermilk

Quota YearAggregate Quantity (MT)
187
2173
3260
4347
5433
6520
7525
8530
9536
10541
11547
12552
13558
14563
15569
16574
17580
18586
19592

15. TRQ-CA11: Whey Powder

Quota YearAggregate Quantity (MT)
1689
21,378
32,068
42,757
53,446
64,135
74,176
84,218
94,260
104,303

16. TRQ-CA12: Products Consisting of Natural Milk Constituents

Quota YearAggregate Quantity (MT)
1460
2920
31,380
41,840
52,300
62,760
72,788
82,815
92,844
102,872
112,901
122,930
132,959
142,989
153,019
163,049
173,079
183,110
193,141

17. TRQ-CA13: Ice Cream and Ice Cream Mixes

Quota YearAggregate Quantity (MT)
1115
2230
3345
4460
5575
6690
7697
8704
9711
10718
11725
12732
13740
14747
15755
16762
17770
18778
19785

18. TRQ-CA14: Other Dairy

Quota YearAggregate Quantity (MT)
1115
2230
3345
4460
5575
6690
7697
8704
9711
10718
11725
12732
13740
14747
15755
16762
17770
18778
19785

19. TRQ-CA15: Chicken

(a) The aggregate quantity of originating goods described in subparagraph (b) that shall be permitted to enter duty-free in each quota year under this TRQ is:

Quota YearAggregate Quantity (MT eviscerated product basis)
147,000
249,000
351,000
453,000
555,000
657,000
757,570
858,146
958,727
1059,314
1159,908
1260,507
1361,112
1461,723
1562,340
1662,963

20. TRQ-CA16: Eggs and Egg Products

Quota YearAggregate Quantity (dozen eggs equivalent)
11,666,667
23,333,333
35,000,000
46,666,667
58,333,333
610,000,000
710,100,000
810,201,000
910,303,010
1010,406,040
1110,510,101
1210,615,202
1310,721,354
1410,828,567
1510,936,853
1611,046,221

Section C: Turkey, Turkey Products, Broiler Hatching Eggs, and Chicks

21. For the purposes of this Section:

22. If Canada adopts or maintains TRQs under Canada’s WTO tariff schedule on any of the goods set out in Section C, Canada shall permit the importation of such goods as follows:

Appendix 2: Tariff Schedule of the United States - (Tariff Rate Quotas)

Section A: General Provisions

1. This Appendix sets out modifications to the Harmonized Tariff Schedule of the United States (HTSUS) that reflect the tariff rate quotas (TRQs) that the United States shall apply to certain originating goods from Canada under this Agreement. In particular, originating goods of Canada included under this Appendix shall be subject to the rates of duty set out in this Appendix instead of the rates of duty specified in Chapter 1 through Chapter 97 of the HTSUS. Notwithstanding any other provision of the HTSUS, originating goods of Canada in the quantities described in this Appendix shall be permitted entry into the territory of the United States as provided in this Appendix. Furthermore, except as provided below, any quantity of originating goods imported from Canada under a TRQ provided for in this Appendix shall not be counted toward the in-quota quantity of any TRQ provided for such goods under the United States’ WTO Tariff Schedule, the United States’ WTO Schedule of Concessions or any other trade agreement.

2. Except as provided below, the United States shall administer all TRQs provided for in this Agreement and set out in this Appendix on a first-come, first-served basis.

3. For the purposes of this Appendix, quota year means calendar year.

4. Each good or group of goods covered by each TRQ set out below is informally described in the title to the paragraph setting out the TRQ. These titles are included solely to assist readers in understanding this Appendix and shall not alter or supersede the coverage for each TRQ established by reference to the relevant Table 1 provisions.

5. For the purposes of this Appendix, the term “metric tons” shall be abbreviated as “MT”.

Section B: Country-Specific TRQs

6. TRQ – US 1: Fluid Cream, Sour Cream, Ice Cream, and Milk Beverages

Quota YearAggregate Quantity (‘000 Liters)
11,750
23,500
35,250
47,000
58,750
610,500

7. TRQ – US 2: Skim Milk Powder

Quota YearAggregate Quantity (MT)
1

1,250

2

2,500

33,750
45,000
56,250
67,500

8. TRQ – US 3: Butter, Cream, and Cream Powder

Quota YearAggregate Quantity (MT)
1750
21,500
32,250
43,000
53,750
64,500

9. TRQ – US 4: Cheese

Quota YearAggregate Quantity (MT)
12,083
24,167
36,250
48,333
510,416
612,500

10. TRQ – US 5: Whole Milk Powder

Quota YearAggregate Quantity (MT)
1115
2230
3345
4460
5575
6690

11. TRQ – US 6: Dried Yogurt, Sour Cream, Whey, and Products of Milk Constituents

Quota YearAggregate Quantity (MT)
11,838
23,677
35,515
47,353
59192
611,030

12. TRQ – US 7: Concentrated Milk

Quota YearAggregate Quantity (MT)
1230
2460
3690
4920
51,150
61,380

13. TRQ – US 8: Other Dairy

Quota YearAggregate Quantity (MT)
1317
2633
3950
41,267
51,583
61,900

14. TRQ – US 9: Sugar

15. TRQ – US 10: Sugar Containing Products

Table 1
HeadingArticle Description
AG04014025Provided for in tariff item 04014025
AG04015025Provided for in tariff item 04015025
AG04015075Provided for in tariff item 04015075
AG04021050Provided for in tariff item 04021050
AG04022125Provided for in tariff item 04022125
AG04022150Provided for in tariff item 04022150
AG04022190Provided for in tariff item 04022190
AG04022950Provided for in tariff item 04022950
AG04029170Provided for in tariff item 04029170
AG04029190Provided for in tariff item 04029190
AG04029945Provided for in tariff item 04029945
AG04029955Provided for in tariff item 04029955
AG04029990Provided for in tariff item 04029990
AG04031050Provided for in tariff item 04031050
AG04039016Provided for in tariff item 04039016
AG04039045Provided for in tariff item 04039045
AG04039055Provided for in tariff item 04039055
AG04039065Provided for in tariff item 04039065
AG04039078Provided for in tariff item 04039078
AG04039095Provided for in tariff item 04039095
AG04041015Provided for in tariff item 04041015
AG04041090Provided for in tariff item 04041090
AG04049050Provided for in tariff item 04049050
AG04051020Provided for in tariff item 04051020
AG04052030Provided for in tariff item 04052030
AG04052070Provided for in tariff item 04052070
AG04059020Provided for in tariff item 04059020
AG04061008Provided for in tariff item 04061008
AG04061018Provided for in tariff item 04061018
AG04061028Provided for in tariff item 04061028
AG04061038Provided for in tariff item 04061038
AG04061048Provided for in tariff item 04061048
AG04061058Provided for in tariff item 04061058
AG04061068Provided for in tariff item 04061068
AG04061078Provided for in tariff item 04061078
AG04061088Provided for in tariff item 04061088
AG04062028Provided for in tariff item 04062028
AG04062033Provided for in tariff item 04062033
AG04062039Provided for in tariff item 04062039
AG04062048Provided for in tariff item 04062048
AG04062053Provided for in tariff item 04062053
AG04062063Provided for in tariff item 04062063
AG04062067Provided for in tariff item 04062067
AG04062071Provided for in tariff item 04062071
AG04062075Provided for in tariff item 04062075
AG04062079Provided for in tariff item 04062079
AG04062083Provided for in tariff item 04062083
AG04062087Provided for in tariff item 04062087
AG04062091Provided for in tariff item 04062091
AG04063018Provided for in tariff item 04063018
AG04063028Provided for in tariff item 04063028
AG04063038Provided for in tariff item 04063038
AG04063048Provided for in tariff item 04063048
AG04063053Provided for in tariff item 04063053
AG04063063Provided for in tariff item 04063063
AG04063067Provided for in tariff item 04063067
AG04063071Provided for in tariff item 04063071
AG04063075Provided for in tariff item 04063075
AG04063079Provided for in tariff item 04063079
AG04063083Provided for in tariff item 04063083
AG04063087Provided for in tariff item 04063087
AG04063091Provided for in tariff item 04063091
AG04064070Provided for in tariff item 04064070
AG04069012Provided for in tariff item 04069012
AG04069018Provided for in tariff item 04069018
AG04069032Provided for in tariff item 04069032
AG04069037Provided for in tariff item 04069037
AG04069042Provided for in tariff item 04069042
AG04069048Provided for in tariff item 04069048
AG04069054Provided for in tariff item 04069054
AG04069068Provided for in tariff item 04069068
AG04069074Provided for in tariff item 04069074
AG04069078Provided for in tariff item 04069078
AG04069084Provided for in tariff item 04069084
AG04069088Provided for in tariff item 04069088
AG04069092Provided for in tariff item 04069092
AG04069094Provided for in tariff item 04069094
AG04069097Provided for in tariff item 04069097
AG15179060Provided for in tariff item 15179060
AG17011250Provided for in tariff item 17011250
AG17011350Provided for in tariff item 17011350
AG17011450Provided for in tariff item 17011450
AG17019130Provided for in tariff item 17019130
AG17019148Provided for in tariff item 17019148
AG17019158Provided for in tariff item 17019158
AG17019950Provided for in tariff item 17019950
AG17022028Provided for in tariff item 17022028
AG17023028Provided for in tariff item 17023028
AG17024028Provided for in tariff item 17024028
AG17026028Provided for in tariff item 17026028
AG17029020Provided for in tariff item 17029020
AG17029058Provided for in tariff item 17029058
AG17029068Provided for in tariff item 17029068
AG17049058Provided for in tariff item 17049058
AG17049068Provided for in tariff item 17049068
AG17049078Provided for in tariff item 17049078
AG18061015Provided for in tariff item 18061015
AG18061028Provided for in tariff item 18061028
AG18061038Provided for in tariff item 18061038
AG18061055Provided for in tariff item 18061055
AG18061075Provided for in tariff item 18061075
AG18062026Provided for in tariff item 18062026
AG18062028Provided for in tariff item 18062028
AG18062036Provided for in tariff item 18062036
AG18062038Provided for in tariff item 18062038
AG18062073Provided for in tariff item 18062073
AG18062077Provided for in tariff item 18062077
AG18062082Provided for in tariff item 18062082
AG18062083Provided for in tariff item 18062083
AG18062087Provided for in tariff item 18062087
AG18062089Provided for in tariff item 18062089
AG18062094Provided for in tariff item 18062094
AG18062098Provided for in tariff item 18062098
AG18063206Provided for in tariff item 18063206
AG18063208Provided for in tariff item 18063208
AG18063216Provided for in tariff item 18063216
AG18063218Provided for in tariff item 18063218
AG18063270Provided for in tariff item 18063270
AG18063280Provided for in tariff item 18063280
AG18069008Provided for in tariff item 18069008
AG18069010Provided for in tariff item 18069010
AG18069018Provided for in tariff item 18069018
AG18069020Provided for in tariff item 18069020
AG18069028Provided for in tariff item 18069028
AG18069030Provided for in tariff item 18069030
AG18069039Provided for in tariff item 18069039
AG18069049Provided for in tariff item 18069049
AG18069059Provided for in tariff item 18069059
AG19011016Provided for in tariff item 19011016
AG19011026Provided for in tariff item 19011026
AG19011036Provided for in tariff item 19011036
AG19011044Provided for in tariff item 19011044
AG19011056Provided for in tariff item 19011056
AG19011066Provided for in tariff item 19011066
AG19011076Provided for in tariff item 19011076
AG19012015Provided for in tariff item 19012015
AG19012025Provided for in tariff item 19012025
AG19012035Provided for in tariff item 19012035
AG19012050Provided for in tariff item 19012050
AG19012060Provided for in tariff item 19012060
AG19012070Provided for in tariff item 19012070
AG19019036Provided for in tariff item 19019036
AG19019062Provided for in tariff item 19019062
AG19019065Provided for in tariff item 19019065
AG19019068Provided for in tariff item 19019068
AG19019071Provided for in tariff item 19019071
AG21011238Provided for in tariff item 21011238
AG21011248Provided for in tariff item 21011248
AG21011258Provided for in tariff item 21011258
AG21012038Provided for in tariff item 21012038
AG21012048Provided for in tariff item 21012048
AG21012058Provided for in tariff item 21012058
AG21039078Provided for in tariff item 21039078
AG21050020Provided for in tariff item 21050020
AG21050040Provided for in tariff item 21050040
AG21069009Provided for in tariff item 21069009
AG21069026Provided for in tariff item 21069026
AG21069036Provided for in tariff item 21069036
AG21069046Provided for in tariff item 21069046
AG21069066Provided for in tariff item 21069066
AG21069072Provided for in tariff item 21069072
AG21069076Provided for in tariff item 21069076
AG21069080Provided for in tariff item 21069080
AG21069087Provided for in tariff item 21069087
AG21069091Provided for in tariff item 21069091
AG21069094Provided for in tariff item 21069094
AG21069097Provided for in tariff item 21069097
AG22029928Provided for in tariff item 22029928
AG23099028Provided for in tariff item 23099028
AG23099048Provided for in tariff item 23099048

ANNEX 2-C PROVISIONS BETWEEN MEXICO AND THE UNITED STATES ON AUTOMOTIVE GOODS

1. This Annex does not apply to originating goods that qualify for duty free preferential tariff treatment under Chapter 4 (Rules of Origin) that are imported to the United States from Mexico and are:

2. The customs duty applied by the United States on passenger vehicles imported from Mexico classified in subheadings 8703.21 through 8703.90 that do not qualify as originating under Chapter 4 (Rules of Origin) , shall not exceed the lesser of 2.5 percent or the United States’ most-favored-nation (MFN) applied rate in effect at the time of the importation of the good.

3. The customs duty applied by the United States on light trucks imported from Mexico classified in subheadings 8704.21 or 8704.31 that do not qualify as originating under Chapter 4 (Rules of Origin), shall not exceed the lesser of 25 percent or the United States’ MFN applied rate in effect at the time of the importation of the good.

4. The customs duty applied by the United States on auto parts imported from Mexico listed in the Appendix to this Annex that do not qualify as originating under Chapter 4 (Rules of Origin), shall not exceed the lesser of the United States’ MFN applied rate in effect on August 1, 2018 or the MFN applied rate in effect at the time of the importation of the good.

5. If the United States implements any measure that increases its MFN applied rate in effect on August 1, 2018 on passenger vehicles classified in subheadings 8703.21 through 8703.90, or on auto parts listed in the Appendix to this Annex, and in order to protect Mexico’s ability to export passenger vehicles and auto parts throughout the territories of the Parties at volumes that take into account Mexico’s existing manufacturing capacity, the following shall apply:

Appendix - Auto Parts

Note: For purposes of reference only, descriptions are provided next to the corresponding tariff provisions.

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