ITC to Provide Advice on Proposed Modifications to NAFTA Rules of Origin for Certain TVs, Cocoa, Leather, Feather Products, Glassware, High-Tech Products, Etc. from Canada and Mexico

The USTR has requested that the ITC provide advice by September 26, 2005 on the probable effect of the proposed modifications on U.S. trade under the NAFTA and on domestic industries. Written comments for this investigation are due by August 3, 2005.

(According to the ITC, the President must issue a proclamation to implement these proposed modifications.)

Overview of Proposed Modifications to NAFTA Rules of Origin

According to the enclosure to USTR's request letter, the proposed modifications to the NAFTA rules of origin (which are found in HTS General Note 12) would affect the articles and HTS numbers listed below (see USTR's letter for further details).

In addition, a Canadian notice in the June 25, 2005 Canada Gazette contains the below text descriptions for the proposed modifications.

Cocoa and cocoa preparations

Under the proposal, unfilled chocolate bars would be subject to the same requirement applicable to filled chocolate bars and will be considered originating if made in the NAFTA territory from non-originating cocoa powder or bulk forms of chocolate.

Affected tariff numbers: 1806.31-1806.90

Cranberry juice

This proposal would simplify the administration of the rules applicable to mixtures of cranberry juice by replacing the limit set by volume with a regional value content requirement. It would also increase the amount of certain non-originating juices that can be used in the mixtures without losing their originating status.

Affected tariff numbers: 2009.90 and 2202.90

Ores, slag, and ash

This proposal is a technical rectification and would have no impact.

Affected tariff numbers: 26.01-26.21

Leather

This proposal would generally simplify the rules applicable to leather by removing unnecessary exceptions and allow the processing of reptile leather from a wet to a dry state to confer origin.

Affected tariff numbers:

Cork and articles of cork

Under this proposal, the preparation of industrial cork products in the NAFTA territory from non-originating raw, natural cork would confer origin.

Affected tariff numbers: 45.01-45.04

Prepared feathers and down and articles made of feathers or of down; Artificial flowers; Articles of human hair

This proposal is a technical rectification and would have no impact.

Affected tariff numbers: 67.01 and 67.02-67.04

Glass and glassware

Under this proposal, glass balls and tubes made in the NAFTA territory from non-originating scrap glass would meet the rules of origin.

Affected tariff numbers:

Copper

Under this proposal, the refining of copper would confer origin.

Affected tariff numbers: 74.01-74.03

Base Metals and Articles of Base Metals:

Under these proposals, the reduction by at least 50% of bars into wire would confer origin. The regional value content requirement would be eliminated in some cases.

Nickel and articles thereof

Affected tariff numbers:

Lead

Affected tariff numbers:

Zinc and articles thereof

Affected tariff numbers:

Tin

Affected tariff numbers: 80.03 and 80.04-80.07

Other base metals

Affected tariff numbers: 8101.10-8113.00

Televisions

Under these proposals, restrictions on the use of non-originating printed circuit assemblies would be removed with respect to color television receivers, monitors and projectors with flat panel screens or black and white projectors or monitors.

Affected tariff numbers:

Information Technology Agreement (ITA)¹ goods

Under these proposals, less onerous tariff change rules would apply to certain information technology products allowing the use of non-originating parts. In some cases the regional value content requirement would be eliminated.

Affected tariff numbers:

Controls

Under this proposal, controls will be subject to a lower regional value content requirement level.

Affected tariff numbers: 9032.20-9032.89

(According to the ITC, the above list of proposed modifications reflects a June 16, 2005 amendment from the USTR deleting filament yarns of viscose rayon, tri-lobal rayon staple fiber, and untextured yarns of nylon, as the ITC has previously provided probable effect advice concerning modifications to rules of origin for these products in investigations NAFTA-103-7 and NAFTA-103-9.

See ITT's Online Archives or 03/04/05 and 01/07/05 news, 05030420 and 05010760, for BP summary of the ITC's report for NAFTA-103-7 and for BP listing of the ITC's report for NAFTA-103-9, respectively.)

¹ On December 13, 1996, a World Trade Organization (WTO) Information Technology Agreement (ITA) to eliminate duties on global information technology products (semiconductors, telecommunications equipment, computers and computer equipment and software products) was formally endorsed by the U.S. and 27 other nations. (See ITT's 01/10/97 news, 97010901, for BP summary.)

(See ITT's Online Archives or 06/29/05 news, 05062910, for BP summary of the June 15, 2005 effective date for certain NAFTA rules of origin modifications made in Proclamation 7870 for goods of Mexico.)

- written comments are due by close of business on August 3, 2005

ITC notice (Inv. No. NAFTA-103-012, FR Pub 06/24/05) available at http://a257.g.akamaitech.net/7/257/2422/01jan20051800/edocket.access.gpo.gov/2005/pdf/05-12570.pdf

USTR request letter (dated 05/23/05) available at http://edisweb.usitc.gov/edismirror/103-012/Final/231800/256765/bcd/672C23.pdf

Canadian notice in the June 25, 2005 Canada Gazette available at http://canadagazette.gc.ca/partI/2005/20050625/html/notice-e.htmli4