CCFTA Rules of Origin Regulations (SOR/97-340)

10. (1) For purposes of calculating the regional value content of motor vehicles, the producer of those motor vehicles may elect that

• (a) the sum of the net costs incurred and the sum of the values of non-originating materials used by the producer be calculated over the producer’s fiscal year with respect to the motor vehicles that are in any one of the categories set out in subsection (5) that is chosen by the producer; and

• (b) the sums referred to in paragraph (a) be used in the calculation referred to in subsection 6(3) as the net cost and the value of non-originating materials, respectively.

(2) An election made under subsection (1) shall

• (a) state the category chosen by the producer, and

  • (i) where the category referred to in paragraph (5)(a) is chosen, state the model line, model name, class of motor vehicle and tariff classification of the motor vehicles in that category, and the location of the plant at which the motor vehicles are produced,

  • (ii) where the category referred to in paragraph (5)(b) is chosen, state the model name, class of motor vehicle and tariff classification of the motor vehicles in that category, and the location of the plant at which the motor vehicles are produced, and

  • (iii) where the category referred to in paragraph (5)(c) is chosen, state the model line, model name, class of motor vehicle and tariff classification of the motor vehicles in that category, and the locations of the plants at which the motor vehicles are produced;

• (b) state the basis of the calculation described in subsection (9);

• (c) state the producer’s name and address;

• (d) state the period with respect to which the election is made, including the starting and ending dates;

• (e) state the estimated regional value content of motor vehicles in the category on the basis stated under paragraph (b);

• (f) be dated and signed by an authorized officer of the producer; and

• (g) except where the producer has elected under subsection (3), be filed with the customs administration of the CCFTA country to which vehicles in that category are to be exported during the period covered by the election,

  • (i) in the case of a producer that exports vehicles to the other CCFTA country for the first time after the entry into force of the Agreement and provides a Certificate of Origin with respect to those vehicles, at least 10 days before the first of those vehicles are exported to the other CCFTA country or such shorter period as that customs administration may accept, and

  • (ii) in any other case, at least 10 days before the first day of the producer’s fiscal year or such shorter period as that customs administration may accept.

(3) Where the fiscal year of a producer begins after the date of the entry into force of the Agreement but before one year after that date, the producer may elect that the calculation of regional value content referred to in subsection (1) or (6) be made under that subsection over the period beginning on the date of the entry into force of the Agreement and ending at the end of that fiscal year.

(4) The election referred to in subsection (3) shall be filed with the customs administration of the CCFTA country to which vehicles are to be exported during the period covered by the election not later than 30 days after the entry into force of the Agreement or such longer period as that customs administration may accept.

(5) The categories referred to in subsection (1) are the following:

• (a) the same model line of motor vehicles in the same class of motor vehicles produced in the same plant in the territory of a CCFTA country;

• (b) the same class of motor vehicles produced in the same plant in the territory of a CCFTA country; and

• (c) the same model line of motor vehicles produced in the territory of a CCFTA country.

(6) Where applicable, a producer of a motor vehicle may elect that the calculation of the regional value content of that motor vehicle be made in accordance with Schedule V.

(7) Subject to subsection 4(4) of Schedule V, the election referred to in subsection (6) shall be filed with the customs administration of the CCFTA country to which vehicles referred to in that schedule are to be exported, at least 10 days before the first day of the producer’s fiscal year with respect to which that election is to apply or such shorter period as that customs administration may accept.

(8) An election filed for the period referred to in subsection (1) or (3) may not be

• (a) rescinded; or

• (b) modified with respect to the category or basis of calculation.

(9) For purposes of this section, where a producer files an election under subsection (1) or (3), the net costs incurred and the values of non-originating materials used by the producer, with respect to

• (a) all motor vehicles that fall within the category chosen by the producer and that are produced during the fiscal year or, in the case of an election filed under subsection (3), during the period with respect to which the election is made, or

• (b) those motor vehicles to be exported to the territory of a CCFTA country that fall within the category chosen by the producer and that are produced during the fiscal year or, in the case of an election filed under subsection (3), during the period with respect to which the election is made

shall be included in the calculation of the regional value content under any of the categories set out in subsection (5).

(10) The producer of a motor vehicle may calculate the regional value content of the motor vehicle over the producer’s fiscal year on the basis of estimated costs, including standard costs, budgeted forecasts or other similar estimating procedures.

(11) Where the producer calculates the regional value content of a motor vehicle in accordance with subsection (10), the producer shall conduct an analysis at the end of the producer’s fiscal year of the actual costs incurred over the period with respect to the production of the motor vehicle and, if the motor vehicle does not satisfy the regional value-content requirement on the basis of the actual costs during that period, immediately inform any person to whom the producer has provided a Certificate of Origin for the motor vehicle, or a written statement that the motor vehicle is an originating good, that the motor vehicle is a non-originating good.

(12) The following example is an “Example” as referred to in subsection 2(4).

A motor vehicle producer located in CCFTA country A produces vehicles that fall within a category set out in subsection 10(5) that is chosen by the producer. The motor vehicles are to be sold in CCFTA countries A and B, as well as in country C, which is not a CCFTA country. Under subsection 10(1), the motor vehicle producer may elect that the sum of the net costs incurred and the sum of the values of non-originating materials used by the producer be calculated over the producer’s fiscal year. The producer may state in the election the basis of the calculation as described in paragraph in which case the calculation would be on the basis of all the motor vehicles produced regardless of where they are destined. Alternatively, the producer may state in the election the basis of the calculation as described in paragraph 10(9)(b). In this case, the producer would also need to state that the calculation is on the basis of the motor vehicles produced that are for export to only CCFTA country B.

The calculation would be on the basis as described in the election.