A Guide To Duties Under NAFTA

2019/01/08

NAFTA or ‘The North American Free Trade Agreement’ is a trade treaty between the countries of Mexico, Canada and United States. NAFTA has been bestowed with huge economic and political powers that make it comparable to the European Union.

The treaty was first established on the 1st of January 1994. Since then a number of other changes have been brought to the treaty and has extended its parameters to the fields of security and immigration.

Here are some of the duties under NAFTA.

Investments

NAFTA enables North American investors with the same powers of investment as other home based investors in countries of Mexico, Canada and the United States. NAFTA governs the investment laws between the various North American nations and also resolves trade disputes among the different investors of the three states.

Certificate of Origins

One of the main duties under NAFTA for the smooth running of trade between the three countries is to issue documents of origin. The document contains information about the producer, state exporter and also importer with tax classification number and coordinated system categorization numbers for the different goods. The Certification is issued only ones the exporter or importer complies with NAFTA rights and requirements. The certificate stands valid for a year and allows the vendor with the certificate to conduct its business in any of the NAFTA country.

Environment

SFI or ‘Sustainable Forestry Initiative’ is a new addition to NAFTA. The treaty focuses on conservation of forest resources in Canada and the United States. The program is also involved in spreading awareness about the importance of forests and wildlife resources on the World ecology. Individual owners of land residing in Canada and US are granted financial aid by ‘The U.S. Fish and Wildlife Service Bird Habitat Conservation’ that comes under the jurisdiction of SFI, NAFTA.

Border Crossing

This treaty of NAFTA entails that shipments with cargo details will have to undergo security scrutiny at the border. A truck driver is allowed to leave the warehouse lying within U.S., only after a print of his cargo and details get faxed to respective borders or ports.

Customs

The three NAFTA countries levy taxes on imported goods. The tax charged is calculated on the basis of ‘harmonized tariff system’ categorization of imported goods, processing fee, value of the good and the country of origin. This System of tariff is used all over the world to calculate tax rate. The HTSA or ‘Harmonized Tariff Schedule of the United States Annotated’, coming under NAFTA, provides a list of imported goods and their tariffs.

National Security

The EECC or ‘Export Enforcement Coordination Center’ categorizes, examines and brings to court abuse of intelligence shared between the countries. It also looks after insuring prevention of violation of policies and laws that govern the national security. The EECC is responsible for managing the various intelligence organizations and law enforcement directorates.

Duties under NAFTA enables knowledge sharing of technical knowledge and trade associations between the countries while ensuring that national security does not get violated in the process.

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