Repeal of Two Customs Tariff Orders

Summary#

Order Repealing Certain Orders Made Under the Customs Tariff (CUSMA) removes two old tariff orders that are no longer needed now that the Canada–United States–Mexico Agreement (CUSMA) replaces the old NAFTA rules. The repeal takes effect immediately before section 190 of the Canada–United States–Mexico Agreement Implementation Act comes into force.

What it does#

• Repeals the Textile and Apparel Extension of Benefit Order.
• Repeals the Order Amending the Schedule to the Customs Tariff (Conditions for Special Provisions for the Purposes of the United States Tariff (UST)).
• Links these repeals to the switch from NAFTA to CUSMA, so domestic tariff rules match the new trade agreement.

Who's affected#

• Importers of goods from the United States and Mexico, especially those in textiles and apparel, are the most directly affected.
• Businesses, including small businesses, that claim preferential tariffs under CUSMA will notice the change because it clears out old NAFTA rules.
• The Canada Border Services Agency (CBSA) will apply and monitor the updated tariff framework in its normal work.

Why it matters#

• This is mainly housekeeping to make Canada’s tariff rules match the new trade deal with the United States and Mexico.
• Without these and related regulatory changes, importers could not properly claim the lower tariffs under CUSMA and might pay higher rates.
• The government estimated the move to implement CUSMA tariff cuts will cause about $7 million per year in foregone tariff revenue — effectively a cost to the treasury and a saving for importers.