Late last year, updates were made to the Canada-UK Trade Continuity Agreement (CUKTCA).
Memorandum D11-5-18 was designed to provide more information about the Canada and UK trade continuity agreement. More specifically, the Administrator of the Government of Canada in Council, recommended by the Minister of Finance, added a CUKTCA set of Rules of Origin regulations.
This is an important aspect that helps clarify how the trade community in Canada and the UK can take advantage of the continuity agreement. We will be providing a breakdown of the updates below.
In short, the purpose of CUKTCA, as stipulated by the federal government, is as follows:
(a) establish a free trade area in accordance with the Agreement;
(b) promote, through the expansion of reciprocal trade, the harmonious development of the economic relations between Canada and the United Kingdom in order to create opportunities for economic development;
(c) promote conditions of fair competition affecting trade between Canada and the United Kingdom;
(d) substantially increase investment opportunities in Canada and the United Kingdom, while preserving the right of each party to the Agreement to regulate to achieve legitimate policy goals;
(e) eliminate barriers to trade in goods and services in order to contribute to the harmonious development and expansion of world and regional trade;
(f) provide adequate and effective protection and enforcement of intellectual property rights in the territory where the Agreement applies;
(g) protect, enhance and enforce basic workers’ rights, strengthen cooperation on labour matters and build on the respective international commitments of Canada and the United Kingdom on labour matters;
(h) enhance and enforce environmental laws and regulations and strengthen cooperation between Canada and the United Kingdom on environmental matters; and
(i) promote sustainable development.
Legislative changes to the Rules of Origin
The Protocol on Rules of Origin and the Origin procedures of the Canada-European Union Comprehensive Economic and Trade Agreement have a force of law in Canada at this time. For those wishing to interpret the legislation directly, you can find this information represented by:
- Articles 1 and 2
- Paragraphs 1-2C and 3 in article 3
- Articles 4 to 17
- Annexes 7, 5 and 5-A, and 1 and 4
All the regulations are coming into force exactly on the day when the Canada–United Kingdom Trade Continuity Agreement Implementation Act section 37 is also coming into force. In case these are registered after the day in question, then the registration date is when they are coming into force, which is something incredibly important to take into consideration here.
General info and guidelines
It’s very important for importers and exporters to note that the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) Protocol on Rules of Origin and Origin Procedures has all the rules of origin information that’s required under CUKTCA. With that in mind, this is what helps set a specific criteria that identifies the status of any item or good.
There can also be specialized requirements and conditions based on the situation at hand.
Moreover, The Product Specific Rules of Origin are added in the CETA Protocol on Rules of Origin and Origin Procedures Annex 5. With that being said, this is also incorporated by reference within CUKTCA. This document establishes the point where components or materials are undergoing enough production in the free trade area. At that point, the good can be seen as originating from that area.
The CBSA Border Information Service (BIS) can offer you more information about this memorandum and how it affects the entire process. You can call them directly from Canada, the US or any other location. There’s also the CBSA website where you can access all the necessary information. It’s an important thing to keep in mind, and one that shows the trade agreement between the UK and Canada continues unharmed, but with some adjustments.
The Memorandum D11-5-18 is a critical document that enhances the current trade agreement in place for these two countries. All while also making a few small adjustments for clarity. Taking advantage of the appropriate free trade agreements is an important part of operating within the trade community and keeping profits looking healthy.
If you’d like to learn more about utilizing trade agreements to your advantage, partner with an experienced customs broker. You can start the conversation here.