The Canada-Colombia Free Trade Agreement (FTA) provides a lot of benefits to businesses in both countries, including reduced barriers to trade and increased investment opportunities. However, to take advantage of these benefits, businesses need to comply with certain requirements, one of which is obtaining a Certificate of Origin.
What is a Certificate of Origin?
A Certificate of Origin (CO) is a document that certifies the origin of goods being exported. It is used by customs officials to determine the tariff rate applicable to a particular shipment. In the case of the Canada-Colombia FTA, a CO is required to claim preferential tariff treatment for goods being exported between the two countries.
How to obtain a Certificate of Origin?
To obtain a CO, the exporter needs to provide a declaration of origin stating that the goods being exported meet the rules of origin requirements as outlined in the FTA. The declaration needs to be made on a specified form or on the commercial invoice, and the exporter must be able to provide supporting documentation to demonstrate compliance with the rules of origin.
The CO can be issued by a variety of parties, including the exporter, the producer, a government authority, or a chamber of commerce. In Canada, the Canadian Chamber of Commerce offers CO services for businesses, while in Colombia, the National Association of Industrialists (ANDI) is responsible for issuing COs.
Why is a Certificate of Origin important?
Obtaining a CO is crucial for businesses that want to take advantage of the benefits provided by the Canada-Colombia FTA. Without a CO, the goods being exported will be subject to the regular tariff rates, which can significantly increase the cost of doing business between the two countries.
In addition, failing to comply with the rules of origin requirements can result in penalties and legal issues for the exporter. Therefore, it is important for businesses to familiarize themselves with the rules of origin and ensure that they can provide the necessary documentation to support their claim for preferential tariff treatment.
The Canada-Colombia Free Trade Agreement provides numerous benefits for businesses in both countries, but compliance with the rules of origin requirements is crucial to take advantage of these benefits. Obtaining a Certificate of Origin is a key part of this compliance, and businesses should ensure that they have the necessary documentation and understanding of the rules to avoid any issues.