Canada-United States-Mexico Agreement (CUSMA) also known as USMCA

On November 30, 2018, Canada, the United States and Mexico signed the new Canada-United States-Mexico Agreement (CUSMA), on the margins of the G20 Leaders’ Summit in Buenos Aires.

What does it mean for importer:

TO CANADA -Express shipments only

Duty-free up to C$150

Tax-free up to C$40

Recovered materials that come from one of the signatory countries will qualify as originating when they are used in remanufactured goods.

CUSMA/ USMCA also introduces changes to regional value content (RVC) calculations. Although the new agreement uses the same two methods as NAFTA to calculate RVC — net cost or transactional value — there are some differences. Under CUSMA, non-originating material may be counted as originating, depending on the value of the processing, and the value of the originating material used in the production of the non-originating material.

Automobile rules of origin (ROO) requirements mandate that a certain portion of an automobile’s value must come from within the governed region. In NAFTA, the required portion was 62.5 percent. The USMCA (CUSMA) increases this requirement by 12.5 percentage points, to 75 percent of the automobile’s value.

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