Will your product benefit from CETA?
99% of tariffs on imported goods have been eliminated under CETA. However, before CETA, many products have already been tariff-free and are therefore not affected by CETA. This includes some foods, chemical products, machinery and consumer goods. The www.tariffinder.ca/ is an excellent and user-friendly way to find your current tariff with and without CETA to see if your company and products would benefit from the CETA agreement. Or see full Customs Tarif Schedule 2018 here.
Does my product qualify to take advantage of CETA? What are the rules of origin required for my product to meet?
Many companies wrongly believe that only selling your product from EU or Canada automatically qualifies the product to take advantage of CETA. Unfortunately, there are very specific Rules of Origin for each product HS code which stipulate rules about the manufacturing location, the source of the product, the amount of processing of the good as well as the location of processing.
Some products can be easy to understand such as exporting vegetables (HS Code 07.01-07.09) or meat (HS Code 02.01-02.10)- the rule of origin states that the vegetable must be wholly obtained (entirely grown or raised) within the EU/Canada.
Some companies are surprised as to how strict the rules of origin can be and can find fulfilling their rules of origin very difficult, such as for textiles. A men’s shirt for example (HS Code 62.03) can have imported yarn, however, the actual material must be weaved in EU/Canada; or can be imported but then must be made up, printed on and include at least two finishing operations done in EU/Canada (such as: scouring, bleaching, mercerising, heat setting, raising, calendaring, shrink resistance processing, permanent finishing, diecasting, impregnating, mending, burling); and the value of the initially imported fabric must be less than 47.5% of the transaction value.
Though this rule of origin may be challenging to fulfill for many EU/Canadian clothing manufacturers, the benefit of this company would be a savings of 17-18% tariff which is very appealing and could incentivize adjusting the supply chain to benefit from cost savings.
I want to proceed with shipping under CETA What documentation do I need?
Exporters must include relevant CETA documentation with each shipment.
Exporters must include proof of origin of the shipped products which is a copy of a statement from the manufacturer or supplier that says the product shipped is fulfilling the rule of origin.
The origin declaration is exactly the below text which can be added to any invoice or commercial document: “The exporter of the products covered by this document (customs * authorization No. SE/REX/123456-7890) declare that, except where otherwise clearly indicated, these products are of EU preferential origin.” (See Annex 2: Text of Origin Declaration)
EU exporters shipping goods for over 6000 Euro must register their business with their national customs agency as a “Registered Exporter” and include this number on their shipments. Registering the company adds the company name to a public database which lists your products rules of origin and facilitates shipment process for customs and your importer as it replaces the need for EUR1 and Certificate of Origin form.
All exporters must keep the shipping documents for three years.
I have just started claiming my products under CETA, but my products have qualified since September 21, 2017. Can I request a refund for my tariffs paid between September 21 and today?
Yes! As long as your product has qualified as an originating product, a company has three years from the shipment date to request a refund of duties paid from September 21, 2017.
(See Article 21)
If you are a Swedish company considering the Canadian market and need advice about the first steps to exports, please contact our Trade Facilitation Advisor Anna Folkesson - Anna.Folkesson@business-sweden.se
If you have any additional questions about CETA or the Canadian market, please reach out to our Canadian CETA advisor: Agata Leszkiewicz - Agata.Leszkiewicz@business-sweden.se