Amendment of Schedule

Renumbering of tariff items

13. The Minister may, by regulation, amend the List of Tariff Provisions to change a tariff item number or a description of goods in a tariff item, if the amendment does not affect the rate of customs duty applicable to those goods.

Amendment of List of Tariff Provisions

14. (1) The Governor in Council may, on the recommendation of the Minister, by order, amend the schedule, other than tariff item No. 9898.00.00 or 9899.00.00, to give effect to

    (a) an amendment to the Harmonized Commodity Description and Coding System or to any advice on the interpretation of that System approved by the Customs Co-operation Council (also known as the World Customs Organization);

    (b) a modification to an agreement or arrangement relating to international trade to which the Government of Canada is a party; or

    (c) an arrangement or commitment that extends the benefits of an agreement relating to international trade to which the Government of Canada is a party.

Reciprocal reductions

(2) The Governor in Council may, on the recommendation of the Minister, by order, amend the List of Tariff Provisions and the ``F'' Staging List to reduce a rate of customs duty on goods imported from a country, and to make other amendments consequential thereto,

    (a) by way of compensation for concessions granted by the country or any other country, subject to any conditions set out in the order;

    (b) as may be required by Canada's international obligations, subject to any conditions set out in the order; and

    (c) by way of compensation for any action taken under subsection 55(1), section 60 or subsection 63(1), 69(2), 70(2), 71(2), 72(1), 75(1) or 76(1) or under subsection 5(3), (3.2) or (4.1) of the Export and Import Permits Act.

Order may be retroactive

(3) An order made under subsection (2) may, if it so provides, be retroactive and have effect in respect of a period before it is made that begins after the coming into force of this section.

List of Countries

15. (1) The Minister may, by regulation, amend the List of Countries to reflect a change in the name of a country set out in that List.

Effect

(2) An amendment under subsection (1) does not affect the tariff treatments indicated for the country in respect of which the change is made.

PART 2

CUSTOMS DUTIES

DIVISION 1

ORIGIN OF GOODS

Rules of Origin

Meaning of ``originate''

16. (1) Subject to any regulations made under subsection (2), for the purposes of this Act, goods originate in a country if the whole of the value of the goods is produced in that country.

Rules of origin regulations

(2) The Governor in Council may, on the recommendation of the Minister, make regulations

    (a) respecting the origin of goods, including regulations

      (i) deeming goods, the whole or a portion of which is produced outside a country, to originate in that country for the purposes of this Act or any other Act of Parliament, subject to such conditions as are specified in the regulations, and

      (ii) for determining when goods originate in a country for the purposes of this Act or any other Act of Parliament; and

    (b) for determining when goods are entitled to a tariff treatment under this Act.

Application of rules of origin regulations

(3) For the purpose of implementing the Agreement on Rules of Origin in Annex 1A of the World Trade Organization Agreement and any annex added to it under Article 9 of that Agreement, regulations made under subsection (2) may, if they so provide, prevail over any other regulations to the extent of any inconsistency.

Uniform regulations

(4) The Governor in Council may, on the recommendation of the Minister, make regulations for the uniform interpretation, application and administration of

    (a) Chapters Three and Four of the North American Free Trade Agreement and any other matters agreed on from time to time by the parties to that Agreement for the purposes of that Agreement; and

    (b) Chapters C and D of the Canada-Chile Free Trade Agreement and any other matters agreed on from time to time by the parties to that Agreement for the purposes of that Agreement.

Direct Shipment and Transhipment

Direct shipment

17. (1) For the purposes of this Act, goods are shipped directly to Canada from another country when the goods are conveyed to Canada from that other country on a through bill of lading to a consignee in Canada.

Regulations

(2) The Governor in Council may, on the recommendation of the Minister, make regulations deeming goods that were not conveyed to Canada from another country on a through bill of lading to a consignee in Canada to have been shipped directly to Canada from that other country, subject to such conditions as may be set out in the regulations.

Tranship-
ment

18. (1) Notwithstanding section 17, for the purposes of this Act, if goods that are exported to Canada from a country have been transhipped in an intermediate country, the goods are deemed not to have been shipped directly to Canada from the first-mentioned country if

    (a) the goods do not remain under customs transit control in the intermediate country;

    (b) the goods undergo an operation in the intermediate country other than unloading, reloading or splitting up of loads, or any other operation required to keep the goods in good condition;

    (c) the goods enter into trade or consumption in the intermediate country; or

    (d) the goods remain in temporary storage, under any conditions as may be prescribed, in the intermediate country for a period exceeding the prescribed period.

Regulations

(2) The Governor in Council, on the recommendation of the Minister of National Revenue, may make regulations prescribing conditions and a period for the purposes of paragraph (1)(d).

Marking of Goods

Regulations requiring marking

19. (1) The Governor in Council may, on the recommendation of the Minister, make regulations

    (a) requiring imported goods of any description or class, including a description or class specified in terms of the use of the goods, to be marked, in accordance with regulations made under subsection (2), so as to indicate their country or geographic area of origin; and

    (b) for determining the country or geographic area of origin of imported goods for marking purposes.

Regulations prescribing marking requirements

(2) The Minister of National Revenue may make regulations for the purpose of the administration of this section, including regulations prescribing

    (a) the manner in which imported goods must be marked and any conditions applicable to the marking of the goods; and

    (b) when imported goods must be marked, including whether they must be marked before or after importation, and any conditions applicable to the time of marking.

Applicability of regulations

(3) Regulations made under this section may apply generally or be limited to particular countries or geographic areas defined in the regulations.

DIVISION 2

IMPOSITION OF CUSTOMS DUTIES

General

Imposition of customs duty

20. (1) Unless otherwise indicated in Chapter 98 or 99 of the List of Tariff Provisions, in addition to any other duties imposed under this Act or any other Act of Parliament relating to customs, there shall be levied on all goods set out in the List of Tariff Provisions, at the time those goods are imported, and paid in accordance with the Customs Act, a customs duty at the rates set out in that List, the ``F'' Staging List or section 29 that are applicable to those goods.

Value for duty of Canadian goods returned

(2) For the purposes of section 44 of the Customs Act, the value for duty of goods that have been taken out of Canada and are subsequently returned to Canada is the value of the goods at the time of the subsequent return if

    (a) the goods were repaired outside Canada;

    (b) equipment was added to the goods outside Canada; or

    (c) work was done outside Canada on the goods.

Imposition of additional duties

21. (1) In addition to any other duties imposed under this Act or any other Act of Parliament relating to customs, there shall be levied on all goods subject to excise, at the time those goods are imported, and paid in accordance with the Customs Act, an additional duty equal to the excise duty that would be levied on the goods under the Excise Act if

    (a) the goods had been manufactured or produced in Canada; and

    (b) in respect of goods of tariff item No. 2207.20.19, subsections 1(2) to (6) of Part I of the schedule to the Excise Act did not apply to the goods.

Definition of ``goods subject to excise''

(2) In subsection (1), ``goods subject to excise'' means

    (a) beer or malt liquor, within the meaning of the Excise Act, of heading No. 22.03 or of tariff item No. 2202.90.10 or 2206.00.70;

    (b) spirits, within the meaning of the Excise Act, of an alcoholic strength by volume exceeding 22.9% volume, of tariff item No. 2204.21.32, 2204.29.32, 2205.10.30, 2205.90.30, 2206.00.22, 2206.00.69 or 2206.00.92;

    (c) spirits, within the meaning of the Excise Act, of heading No. 22.07 or 22.08, other than of tariff item No. 2207.20.11, 2207.20.90, 2208.90.30 or 2208.90.91;

    (d) cigars or manufactured tobacco, within the meaning of the Excise Act, of tariff item No. 2402.10.00, 2402.20.00, 2403.10.00, 2403.91.90, 2403.99.10 or 2403.99.90; or

    (e) goods referred to in any of paragraphs (a) to (d) that are classified with the container in which they are imported.

Other duties

22. In addition to the duties imposed under this Act or any other Act of Parliament relating to customs, there shall be levied on imported goods, at the time of their importation, and paid in accordance with the Customs Act, a duty comprised of any surtax or temporary duty imposed under Division 4 of this Part.

Special Classification

Goods of Chapter 99

23. Goods of Chapter 99 of the List of Tariff Provisions are entitled to the rate of customs duty set out for those goods in the column entitled ``Most-Favoured-Nation Tariff'' or ``Preferential Tariff'' in that Chapter, according to the tariff treatment applicable to their country of origin.

DIVISION 3

TARIFF TREATMENTS

General

Conditions

24. (1) Unless otherwise provided in an order made under subsection (2) or otherwise specified in a tariff item, goods are entitled to a tariff treatment, other than the General Tariff, under this Act only if

    (a) proof of origin of the goods is given in accordance with the Customs Act; and

    (b) the goods are entitled to that tariff treatment in accordance with regulations made under section 16 or an order made under paragraph 31(1)(a), 34(1)(a), 38(1)(a) or 42(1)(a), subsection 45(13) or section 48.

Exemption

(2) The Governor in Council may, on the recommendation of the Minister, by order, exempt goods entitled to a tariff treatment other than the General Tariff from any condition set out in subsection (1), on such conditions as may be specified in the order.

Most favourable tariff

25. If, under this Act, goods are entitled to both the Most-Favoured-Nation Tariff and another Tariff and the amount of customs duty imposed under the Most-Favoured-Nation Tariff is lower than the amount imposed under the other Tariff, the rate of customs duty under the Most-Favoured-Nation Tariff applies to those goods in lieu of the rate under the other Tariff.

Goods in transit

26. An order made under paragraph 31(1)(b), 34(1)(b), 38(1)(b) or 42(1)(b) may provide that goods that are in transit to Canada at the time the order comes into force are entitled to the tariff treatment that was applicable to those goods immediately before that time.

Abbreviations

27. For the purposes of the List of Tariff Provisions and the ``F'' Staging List, the abbreviations ``UST'', ``MT'', ``MUST'', ``CT'', ``CIAT, ``GPT'', ``LDCT'', ``CCCT'', ``AUT'' and ``NZT'' refer, respectively, to ``United States Tariff'', ``Mexico Tariff'', ``Mexico-United States Tariff'', ``Chile Tariff'', ``Canada-Israel Agreement Tariff'', ``General Preferential Tariff'', ``Least Developed Country Tariff'', ``Commonwealth Caribbean Countries Tariff'', ``Australia Tariff'' and ``New Zealand Tariff''.

If rate not specified

28. The symbol ``N/A'', if it is set out in the column entitled ``Most-Favoured-Nation Tariff'' in the List of Tariff Provisions, or in the column entitled ``Preferential Tariff'' in that List in combination with an abbreviation designating a preferential tariff treatment of a tariff item, indicates that that tariff treatment does not apply to that tariff item.

General Tariff

Application of General Tariff

29. (1) A General Tariff rate of customs duty of 35% applies to

    (a) goods that originate in a country that is not set out in the List of Countries;

    (b) goods that originate in a country set out in the List of Countries and that fail to meet the conditions for entitlement to any other tariff treatments provided for under this Act; and

    (c) goods to which the General Tariff applies under paragraph 31(1)(b) or any regulation or order made under this Act.

Exception

(2) Notwithstanding subsection (1), goods referred to in that subsection are subject to the Most-Favoured-Nation Tariff rate of customs duty in respect of those goods if

    (a) that rate is, or is equivalent to, more than 35%; or

    (b) a Note or Supplementary Note to a Chapter of the List of Tariff Provisions or a tariff item so provides.

Most-Favoured-Nation Tariff

Application of MFN Tariff

30. (1) Subject to section 24 and any order made under section 31, goods that originate in a country set out in the List of Countries are entitled to the Most-Favoured-Nation Tariff rates of customs duty.

``A'' final rate

(2) If ``A'' is set out in the column entitled ``Most-Favoured-Nation Tariff'' in the List of Tariff Provisions in relation to goods entitled to the Most-Favoured-Nation Tariff, the Most-Favoured-Nation Tariff rate of customs duty that applies to those goods is the final rate.

Staging for MFN Tariff

(3) If ``B'', ``C'', ``D'' or ``E'' is set out in the column entitled ``Most-Favoured-Nation Tariff'' in the List of Tariff Provisions in relation to goods entitled to the Most-Favoured-Nation Tariff, the Most-Favoured-Nation Tariff rate of customs duty that applies to those goods is the initial rate, reduced

    (a) if ``B'' is set out,

      (i) effective on January 1, 1999, by one half of the difference between the initial rate and the final rate, and

      (ii) effective on January 1, 2000, to the final rate;