Proposed Regulatory Amendments and Proposed New Regulations Related to the Implementation of the Canada-Korea Free Trade Agreement
Customs Notice 14-033
Ottawa, December 22, 2014
1. This customs notice announces regulatory amendments and a new regulation proposed by the Canada Border Services Agency (CBSA) in support of the implementation of the Canada-Korea Free Trade Agreement (CKFTA). It is further proposed that these regulatory amendments and new regulations come into force on January 1, 2015, on the condition that the Governor in Council makes them.
Proposed Regulatory Changes
Certification of Origin of Goods Exported to a Free Trade Partner Regulations
2. It is proposed that the criteria in paragraph 2(c) of the Certification of Origin of Goods Exported to a Free Trade Partner Regulations be amended to refer to the case where goods are exported or are to be exported from Canada to Korea. It is also proposed that a new paragraph be added to section 3 to provide for a certificate of origin, for goods exported or to be exported from Canada to Korea, to be completed in English, French or Korean.
Exporters’ and Producers’ Records Regulations
3. It is proposed that the definition of “advance ruling” set out in the Exporters’ and Producers’ Records Regulations, be amended to include reference to the advance ruling provisions of the CKFTA.
Free Trade Agreement Advance Rulings Regulations
4. It is proposed that paragraph 2(d) of the Free Trade Agreement Advance Rulings Regulations be amended to expand the classes of persons eligible to apply for an advance ruling to include producers in Korea of a material used in the production of goods produced in Korea. With respect to the modification or revocation of an advance ruling, it is proposed that a new subparagraph be added to 14(a) to provide, where goods are exported from Korea, for the modification or revocation of an advance ruling if the advance ruling is based on an error in the application of a value test under Chapter Three of CKFTA. With respect to the modification or revocation of an advance ruling, it is proposed that subparagraph 14(a)(vi) be amended to include reference to goods exported from Korea and Article 2.6 of the CKFTA. It is proposed that paragraph 14(b) of the Regulations be amended to include reference to goods exported from Korea and that a new subparagraph be added to that paragraph in order to reference an interpretation agreed to by Canada and Korea regarding Chapter Two or Three of the CKFTA. It is proposed that Section 14 of the Regulations be amended to provide, where goods are exported from Korea, for the modification or revocation of an advance ruling if the exporter or producer of the goods has not complied with the terms and conditions of the advance ruling with regard to the value test or other terms or conditions of the advance ruling, as applicable, if the operations of the exporter or producer of the goods are not consistent with the material facts and circumstances on which the advance ruling is based with regard to the value test of the goods, as applicable, or if for the purpose of the application for the advance ruling the supporting data and computations used in applying the basis or method for calculating value or allocating cost were incorrect in any material respect with regard to the value test of the goods, as applicable. It is proposed that paragraph 14(h) of the Regulations be amended to include a new subparagraph such that an advance ruling can be modified or revoked in order to conform with a modification of Chapters Two, Three or Four of the CKFTA.
Tariff Item Nos. 9971.00.00 and 9992.00.00 Accounting Regulations
5. It is proposed that paragraph 2(b) of the Tariff Item Nos. 9971.00.00 and 9992.00.00 Accounting Regulations be amended to include reference to Korea so that proof of exportation of the goods to Korea is required when accounting for the goods under section 32 of the Customs Act.
Refund of Duties Regulations
6. It is proposed that the title to Part 5.1 of the Refund of Duties Regulations be amended to make reference to Korea. It is also proposed that section 23.1 of the Regulations be amended such that Part 5.1 of the Regulations applies to the granting of a refund of duties paid on goods imported from Korea on or after January 1, 2015, and for which no claim for preferential tariff treatment under the CKFTA was made at the time the goods were accounted for under subsection 32(1), (3) or (5) of the Customs Act. It is also proposed that paragraph 23.3(b) of the Regulations, respecting the amount of refund of duties, be amended to include the CKFTA.
Proof of Origin of Imported Goods Regulations
7. It is proposed that new provisions be added to the Proof of Origin of Imported Goods Regulations in order to:
- (a) require the importer or owner of the goods for which the benefit of preferential tariff treatment under the CKFTA is claimed, to furnish to an officer, for purposes of section 35.1 of the Customs Act, a certificate of origin for the goods that is completed in English, French or Korean at the time set out in section 13 of the Regulations;
- (b) exempt the importer and owner of goods from the requirements of subsection 35.1(1) of the Customs Act if the importer or owner furnishes to an officer, at the time prescribed by paragraph 13(a) of the Regulations, a written and signed declaration, in English or French, certifying that the goods originate in Korea and that a completed certificate of origin is in the importer’s possession;
- (c) exempt the importer and owner of casual goods for which the benefit of the preferential tariff treatment under the CKFTA is claimed from the requirements of subsection 35.1(1) of the Customs Act, if the casual goods are entitled to preferential tariff treatment under the CKFTA pursuant to the CKFTA Rules of Origin for Casual Goods Regulations;
- (d) exempt the importer and owner of commercial goods for which the estimated value is less than $1,600, and for which the benefit of preferential tariff treatment under the CKFTA is claimed, from the requirements of subsection 35.1(1) of the Customs Act if:
- (i) the goods do not form part of a series of importations that is undertaken or arranged for the purpose of avoiding the requirements of subsection 35.1(1) of the Customs Act, and
- (ii) the importer or owner of the goods furnishes to an officer, at the times set out in Section 13 of the Regulations, a commercial invoice for the goods, containing a written and signed statement, in English or French, from the exporter or producer of the goods, certifying that the goods originate in Korea, or a written and signed statement, in English or French, from the exporter or producer of the goods, certifying that the goods originate in Korea;
- (e) provide that where a certificate of origin is completed in Korean, the importer or owner of the goods shall, at the request of an officer, furnish a translation of the certificate of origin in English or French to the officer;
- (f) provide that a certificate of origin may apply in respect of a single importation of a good or two or more importations of identical goods, imported by the same importer, that occur within a period not exceeding 12 months, as set out in the signed certificate of origin;
- (g) provide that a certificate of origin may be accepted as proof of origin for four years after the day on which it was signed.
Proposed New Regulation
CKFTA Verification of Origin Regulations
8. The new CKFTA Verification of Origin Regulations are proposed to implement the verification provisions of Article 4.6 of the CKFTA, as well as paragraph 13 and the relevant origin verification provisions contained in the Memorandum of Understanding Between Canada and the Republic of Korea Concerning Uniform Regulations for the Interpretation, Application and Administration of Chapter Four of the Free Trade Agreement Between Canada and the Republic of Korea. The Regulations describe the process to be followed by officers when verifying claims for preferential tariff treatment under the CKFTA. The Regulations describe the notification requirements with respect to the postponement of a verification visit in Korea. They also provide for certain documents, including the notice of intention to carry out a verification visit that is sent to the embassy of Korea in Canada, to be sent by any means of transmission that produces a confirmation of receipt.
Additional Information
9. For more information, from within Canada, call the Border Information Service at 1-800-461-9999. For more information, from outside of Canada, call 204-983-3500 or 506-636-5064 (long distance charges will apply). Agents are available Monday to Friday (08:00 – 16:00 local time/except holidays). TTY is also available within Canada at 1-866-335-3237.
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