CUKTCA Rules of Origin for Casual Goods Regulations: SOR/2021-66

Canada Gazette, Part II, Volume 155, Number 8

Registration
SOR/2021-66 March 29, 2021

CUSTOMS TARIFF

P.C. 2021-237 March 26, 2021

His Excellency the Administrator of the Government of Canada in Council, on the recommendation of the Minister of Finance, pursuant to subsection 16(2) footnote a of the Customs Tariff footnote b, makes the annexed CUKTCA Rules of Origin for Casual Goods Regulations.

CUKTCA Rules of Origin for Casual Goods Regulations

Definition of casual goods

1 In these Regulations, casual goods means goods other than goods imported for sale or for an industrial, occupational, commercial or institutional or other like use.

Conditions

2 Casual goods that are acquired in a CUKTCA beneficiary are considered to originate in that country and are, for the purposes of paragraph 24(1)(b) of the Customs Tariff, entitled to the benefit of the United Kingdom Tariff, regardless of whether they would be entitled to it under the CUKTCA Tariff Preference Regulations, if

Coming into force

3 These Regulations come into force on the day on which section 37 of the Canada–United Kingdom Trade Continuity Agreement Implementation Act, chapter 1 of the Statutes of Canada, 2021, comes into force, but if they are registered after that day, they come into force on the day on which they are registered.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the regulations.)

Issues

On January 1, 2021, the United Kingdom (U.K.) departed the European Union (EU) Single Market, thus losing the preferential terms of trade that have been applied under the Canada-EU Comprehensive Economic and Trade Agreement (CETA) since September 21, 2017.

To ensure that Canadian businesses will continue to enjoy preferential trade with the U.K., Canada and the U.K. have agreed to a transitional trade agreement that replicates and preserves access to the benefits provided in CETA on a bilateral basis. The Canada–United Kingdom Trade Continuity Agreement (the Agreement) will remain in place until Canada and the U.K. negotiate a comprehensive free trade agreement that can be best tailored to the bilateral relationship and interests.

The Agreement was signed on December 9, 2020, and the Canada–United Kingdom Trade Continuity Agreement Implementation Act (the Act) has since obtained royal assent. It ensures that Canadian businesses will continue to enjoy preferential trade with the U.K. with terms that replicate those of the CETA and requires new regulations to fully implement this new Agreement.

Objective

To implement Canada's commitments under the Agreement.

Description and rationale

The CUKTCA Rules of Origin Regulations implement, in Canada, the rules of origin of the Agreement to determine when goods have undergone sufficient production to qualify for preferential tariff treatment.

The CUKTCA Rules of Origin for Casual Goods Regulations establish that non-commercial goods acquired in the U.K. and certain associated territories, that are either marked as made in a country eligible to CUKTCA tariff treatment or not marked to the contrary, are considered originating and therefore entitled to the relevant CUKTCA tariff preferences upon their importation into Canada.

The CUKTCA Tariff Preference Regulations allow eligible goods that are not shipped directly to Canada from the U.K. and certain associated territories to retain the eligibility for preferential tariff rates provided the goods remain under customs control in third countries.

These regulations implement the tariff elimination commitments of the Agreement into domestic law and ensure that Canadian businesses will continue to enjoy preferential trade with the U.K. on terms that replicate those of the CETA.

Consultation

A Canada Gazette notice was published in July 2018 to inform Canadians of proposed transitional trade agreement negotiations with the U.K. and the Government's efforts to mitigate disruption for business due to the U.K. plan to leave the EU. As discussions leading to the Agreement were focused on replicating already-into-force CETA provisions on a bilateral basis with the U.K., broad public consultations were not undertaken. Furthermore, given that these regulatory measures replicate CETA provisions and are consequential to the Agreement and Act, no consultations or prepublication were required.

The Government of Canada will seek the views of Canadians from across the country and from all sectors and backgrounds once Canada and the U.K. are ready to launch negotiations toward a possible comprehensive free trade agreement.

One-for-one rule and small business lens

The one-for-one rule does not apply to these regulations, as there is no change in administrative costs or burden to business. These regulations do not change procedures for the importing and exporting of goods. Rather, they establish certain conditions for eligibility for the preferential tariff treatment of the Agreement. Therefore, all businesses, including small businesses, will be able to claim the preferential tariff treatment on goods originating for the purpose of this Agreement and will see benefits in the form of lower duties paid on their imports.

Contact

Brad Norwood
International Trade Policy Division
Department of Finance
Ottawa, Ontario
K1A 0G5
Telephone: 613‑369‑4039
Email: fin.tariff-tarif.fin@canada.ca