USMCA

Customs & Trade

Facilitation

Deep SenGupta, LL.M

CEO, DSG Global,
LLC
Mobile: 415-741-
7256
deep@dsgglobal.com

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 Agenda
1. Overview
2. Digital Trade & IPR
3. “Customs & Trade Facilitation” chapter
4. De minimis
5. USMCA Certificate of origin
6. Low-value shipments
7. Rules of origin (Tariff Shift or
Regional Value Content)
8. Specific industries (Automotive,
Textile and apparel, Dairy)
9. Enforcement
10. Caution! Are your goods originating?
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 Overview
• USMCA, CUSMA, T-MEC: Uniform
Regulations
• Effective date: July 1, 2020. 
• Period of operation: 16 years with
joint reviews every 6 years.
• New Chapters include: Intellectual
property, Digital Trade, De minimis,
Financial Services, Currency, Labor,
Environment

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 Digital Trade & IPR
• INTELLECTUAL PROPERTY: A modernized, high-
standard Intellectual Property (IP) chapter that
provides strong and effective protection and
enforcement of IP rights critical to driving
innovation, creating economic growth, and
supporting American jobs.
• DIGITAL TRADE:
– Firm foundation for the expansion of trade and
investment in innovative products and services
– Protections for United States Innovators and
Creators
– Strongest enforcement provisions & standards of
protection on digital trade of any
international agreement.
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 Customs and Trade Facilitation
• The duty and tax exemption threshold,
increases for imports into Canada and
Mexico, reducing overall shipping
costs. 
• Value limits increase, reducing
documentation burden 
• Expedited release of express shipments
• More integrated North American supply
chains (in light of China tariffs and
COVID-19)
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 De minimis
• Value below which goods are not charged duties
& taxes
• Shipping to Canada:
– CAD $40 and less not subject to duties and taxes.
– CAD $40.01-$150 not subject to duties; taxes apply
• Shipping to Mexico:
– USD $50 and less not subject to duties and taxes
– USD $50.01-$117 not subject to duties; taxes apply
• Shipping to United States:
– USD $800 and less not subject to customs duties and
merchandise processing fees (MPF) (No change)

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 USMCA Certification of Origin (COO)
It must include nine mandatory data elements:
• Indicate the certifier (importer, exporter or producer)—
NEW
• Certifier name, address (including country) and contact
information—NEW
• Exporter name, address and contact info (if different than
certifier)
• Producer name, address and contact info (if different than
certifier)
• Importer name, address and contact info (if different than
certifier)
• Description of goods
• HS tariff classification number
• Origin criterion
• Blanket period (date range up to 12 months)
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 COO
• In addition, the certification must be
signed and dated by the certifier and
accompanied by the following statement:

“ I certify that the goods described in this

document qualify as originating and the
information contained in this document is true
and accurate. I assume responsibility for
proving such representations and agree to
maintain and present upon request or to make
available during a verification visit,
documentation necessary to support this
certification.”
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 Low-value shipment
• This is the threshold below which will
formal entries not required to be
submitted for customs clearance.

– Canada: CAD $3,300 (increase from

CAD $2,500)
– Mexico: USD $1,000 (no change) 
– United States: USD $2,500 (no
change) 

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 LVS certification
• A shorter certification statement
can be included on the commercial
invoice.

“ I hereby certify that the goods

covered by this shipment qualifies
as an originating good for the
purposes of preferential tariff
treatment under USMCA/T-MEC/CUSMA” .

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 Originating goods & Rules of Origin
• A - Wholly obtained or produced entirely in
territory of 1+ Parties
• B - Produced entirely in the territory of 1+
Parties using non-originating materials,
provided good satisfies product-specific RoO
• C - Produced entirely in the territory of 1+
Parties, exclusively from originating
materials
• D - Produced entirely; classified with its
materials or satisfies “unassembled goods”;
and meets RVC thresholds Exception: Chapter
61 to 63
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 Regional Value Content
• New Rules of origin for Automotive,
manufactured goods, textile and apparel,
and agricultural good sectors. 
• Transaction Value Method Threshold: Not
Less Than 60%
• Net Cost Method Threshold: Not Less Than
50%
• Product-specific RVC thresholds can be
found in Chapter 4, Annex 4-B of the
Agreement
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 Specific Industries - Automotive
• Zero customs duties for qualifying goods
• 75% of auto content and components
manufactured in one of the USMCA
countries
• Steel and Aluminum : minimum of 70% from
USMCA
• 40-50% of auto content made by workers
earning at least $16 per hour.
• USMCA Alternative Staging Regime –
Allows for 5 years

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 Specific Industries - Textiles
• Rayon fiber and Fabrics used for visible
linings to be sourced from outside the USMCA
• to be of any origin when used in a good
classified in Chapter 50 through 63
• Tariff Shift Rules changes to Chapter 61 and
62.
• Increase in the De Minimis percentage for
non-originating materials from 7-10% (total
weight of any elastomeric content may not
exceed 7%).
• Yarn-forward rule for Yarn, Woven Fabric
(Fibre can be of any origin), Knit Fabric.
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 Enforcement
• Increased enforcement against ADD/CVD,
IPR infringement, Forced labor,
illegal wild flora & fauna.
• Advanced Rulings:
– to be issued within 120 days
– Maintained online for transparency and
certainty

• Verification Audits (Form 28,

Verification visits to Exporter or
Producers premises)
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Caution! Are the goods originating?
• Just because your goods qualified for
NAFTA, they do not automatically qualify
for USMCA.
• Reevaluate your products based on the
“ rules of origin” in the new agreement
(e.g., tariff shift, regional value
content, etc.)
• Declaring preferential duty rates
without a valid proof of origin at the
time of import can expose your company
to substantial retroactive duties,
interest and penalties.
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 Contact Information
Please feel free to contact me for
any information:

Deep SenGupta, LL.M

CEO, DSG Global, LLC
Mobile: 415-741-7256
Email: deep@dsgglobal.com
Website: www.dsgglobal.com

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