What Criterion "A" does NOT mean:

Criterion "A" covers various goods that are "wholly obtained or produced" but this refers only to natural extraction or similar processes carried out in the NAFTA region. It is extremely important to note that the term "obtained" in this context does NOT mean obtained in the sense of "purchased" or simply "acquired" in Canada, Mexico or the United States. This may seem obvious, but we cannot stress this point enough, as the problem comes up again and again... Many certificates we receive for a wide range of goods, even for sophisticated machinery or electronic equipment, are classified as origin criterion "A" - but this is just plainly impossible. Manufactured articles almost always include numerous components and materials from various sources all over the world.

Why is it important?

Utilizing the wrong origin criterion sends up an instant "red flag" for Customs indicating that your certificate is most probably invalid. Criterion "A" automatically attracts increased scrutiny from Customs inspectors when the goods in question are not fruits, vegetables, minerals, food products or other fairly basic materials. And when invalid certifcates are used to claim preferential tariff treatment under NAFTA, significant monetary penalties can be assessed by Customs under their new AMPS program.

Criterion "A" is specified in Article 401(a) of the NAFTA as follows:

• Mineral goods extracted in the territory of one or more of the parties
• Vegetable goods as defined in the Harmonized System, harvested in the NAFTA region
• Live animals born and raised in the territory of one or more of the parties
• Goods obtained from hunting, trapping or fishing in the territory of one or more of the parties
• Goods (fish, shellfish and other marine life) taken from the sea by vessels registered or recorded with a party and flying its flag
• Goods produced on board factory ships from fish, shellfish and other marine life, provided such factory ships are registered or recorded with that party and fly its flag
• Goods taken by a party or a person of a party from the seabed or beneath the seabed outside territorial waters, provided that a party has rights to exploit such seabed
• Goods taken from outer space, provided they are obtained by a party or a person of a party and not processed in a non-party country
• Waste and scrap derived from: a) production in the territory of one or more of the parties, or b) used goods in the territory of one or more of the parties, provided such goods are fit for the recovery of raw materials
• Goods produced in the territory of one or more of the parties exclusively from goods referred to above, or from their derivatives, at any stage of production.