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MILLAR KREKLEWETZ LLP is a boutique Canadian law firm with lawyers who have
significant expertise in matters involving the North American Free
Trade Agreement.
The
following is a short introduction to the North American Free Trade
Agreement, and various aspects of its implementation under
Canada's customs and trade laws.
NAFTA
In broad terms, the North American
Free Trade Agreement (“NAFTA”) provides for duty free trade
between its member parties, namely Canada, the US and Mexico.
However, this preferential status comes with various
strings attached, namely the requirements relating to:
o
Tariff classification
o
Origin
o
Value for Duty
o
Marking
Generally, these requirements must be
complied with in order for goods flowing between NAFTA countries
to be entitled to the NAFTA preferential duty treatment (note that
NAFTA also addresses trade in services, intellectual property and
investments).
Canada’s
Customs Laws
Domestically, Canada has implemented these
NAFTA requirements into its relevant customs laws, namely the Customs
Act, its regulations and the Customs Tariffs.
Customs
Penalties and Sanctions
Note that the Canadian laws implementing the
NAFTA preferential status impose penalties for violating the
customs requirements. In
addition to losing NAFTA preferential status, importers and
exporters face sanctions and penalties such as seizure,
ascertained forfeiture, civil and criminal sanctions, and
Administrative Monetary Penalties.
Cross-Border Investments
Disputes
Finally, NAFTA also contains detailed dispute
resolution provisions, including those in Chapter 11 of the NAFTA
(“Chapter 11”) for resolving disputes relating to cross-border
investments.
Chapter
11 is one of the most controversial chapters in NAFTA, dealing
with both the mutual obligations that each NAFTA party owes to
foreign investors, and the rules for resolving the disputes that
are going to arise from time to time. Chapter 11 enables
private corporations in one NAFTA country with the right to sue,
through an arbitration process, the national government of another
NAFTA party where that government’s actions negatively affect
the first party’s investment rights under NAFTA..
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Feel
free to contact a lawyer at
MILLAR
KREKLEWETZ LLP who can
consult and advise you on
NAFTA
matters.
Feel free to contact us for a no cost initial
consultation.
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Kreklewetz LLP
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