CUSMA Rules of Origin Regulations (SOR/2020-155)

Marginal note:Passenger vehicle, light truck or heavy truck

• 17 (1) In addition to meeting the requirements of sections 13 to 16 or Schedule 1, a passenger vehicle, light truck or heavy truck is originating only if, during a time period under subsection (7) , at least 70 percent by value of the vehicle producer’s purchases at the corporate level in the territories of one or more of the CUSMA countries of steel and aluminum listed in Table S are of originating goods.

• Marginal note:Automotive parts

  (2) For the purposes of subsection (1), only the value of the steel or aluminum listed in Table S that is used in the production of the part will be taken into consideration for a part of subheading 8708.29 or 8708.99 listed in Table S.

• Marginal note:Application

  (3) Subsection (1) applies to steel and aluminum purchases made by the producer of passenger vehicles, light trucks or heavy trucks, including purchases made directly by the vehicle producer from a steel producer and purchases by the vehicle producer from a steel service centre or a steel distributor. It also applies to steel or aluminum covered by a contractual arrangement in which a producer of passenger vehicles, light trucks or heavy trucks negotiates the terms under which steel or aluminum will be supplied to a parts producer by a steel producer or supplier selected by the vehicle producer, for use in the production of parts that are supplied by the parts producer to a producer of passenger vehicles, light trucks or heavy trucks. Such purchases must also include steel and aluminum purchases for major stampings that form the “body in white” or chassis frame, regardless of whether the vehicle producer or parts producer makes such purchases.

• Marginal note:Other uses

  (4) Subsection (1) applies to steel and aluminum purchased for use in the production of passenger vehicles, light trucks or heavy trucks. Subsection (1) does not apply to steel and aluminum purchased by a producer for other uses, such as the production of other vehicles, tools, dies or moulds.

• Marginal note:Steel — originating

  (5) For the purpose subsection (1), as it applies to a steel good set out in Table S, a good is originating if

  • (a) beginning on July 1, 2020 and ending on June 30, 2027, the good satisfies the applicable requirements established in section 13 or Schedule 1 and all other applicable requirements of these Regulations; and

  • (b) beginning on July 1, 2027 the good satisfies all other applicable requirements of these Regulations, and provided that all steel manufacturing processes occur in one or more of the CUSMA countries, except for metallurgical processes involving the refinement of steel additives.

  Such steel manufacturing processes include the initial melting and mixing and continues through the coating stage. This requirement does not apply to raw materials of used in the steel manufacturing process, including iron ore or reduced, processed, or pelletized iron ore of heading 26.01, pig iron of heading 72.01, raw alloys of heading 72.02 or steel scrap of heading 72.04.

• Marginal note:Value of steel and aluminum

  (6) A vehicle producer must calculate the value of steel and aluminum purchases in subsection (1) using

  • (a) for steel or aluminum imported or acquired in the territory of a CUSMA country,

    • (i) the price paid or payable by the producer in the CUSMA country where the producer is located,

    • (ii) the net cost of the material at the time of importation, or

    • (iii) the transaction value of the material at the time of importation; and

  • (b) for steel or aluminum that is self-produced,

    • (i) all costs incurred in the production of materials, which includes general expenses, and

    • (ii) an amount equivalent to the profit added in the normal course of trade or equal to the profit that is usually reflected in the sale of goods of the same class or kind as the self-produced material that is being valued.

• Marginal note:Calculation period

  (7) For the purposes of subsection (1), the producer may calculate the purchases made

  • (a) over the previous fiscal year of the producer;

  • (b) over the previous calendar year;

  • (c) over the quarter or month to date in which the vehicle is exported;

  • (d) over the producer’s fiscal year to date in which the vehicle is exported; or

  • (e) over the calendar year to date in which the vehicle is exported.

• Marginal note:Estimates

  (8) If the producer chooses to base a steel or aluminium calculation on paragraph (7)(c), (d) or (e), that calculation may be based on the producer’s estimated purchases for the applicable period.

• Marginal note:Option for calculation

  (9) For the purposes of subsection (1), the producer may calculate the purchases on the basis of

  • (a) all motor vehicles produced in one or more plants in the territory of one or more CUSMA countries;

  • (b) all motor vehicles exported to the territory of one or more CUSMA countries;

  • (c) all motor vehicles in a category set out in subsection 16(1) that are produced in one or more plants in the territory of one or more CUSMA countries; or,

  • (d) all motor vehicles in a category set out in subsection 16(1) exported to the territory of one or more CUSMA countries.

• Marginal note:Different periods

  (10) The producer may choose different periods for the purposes of its steel and aluminium calculations.

• Marginal note:Year end analysis

  (11) If the producer of a passenger vehicle, light truck, or heavy truck has calculated steel or aluminum purchases on the basis of estimates before or during the applicable period, the producer must conduct an analysis at the end of the producer’s fiscal year of the actual purchases made over the period with respect to the production of the vehicle. If the passenger vehicle, light truck, or heavy truck does not satisfy the steel or aluminum requirement on the basis of the actual purchases, the purchaser must immediately inform any person to whom the producer has provided a certification of origin for the vehicle or a written statement that the vehicle is an originating good that the vehicle is a non-originating good.