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New LDC Rules of Origin for Apparel Announced in Federal Budget

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New LDC Rules of Origin for Apparel Announced in Federal Budget 2017-04-20

In the Budget speech on March 22, 2017, the Hon. Bill Moreau, Minister of Finance, announced the Canadian Government’s intention to liberalize certain provisions of Canada’s Least Developed Country Tariff rules of origin.
 
It is expected that the LDC rules of origin will be amended to allow fabric and yarn produced in countries with which Canada has a free trade agreement (e.g., the U.S.) to be used in the production of certain cotton and synthetic-fiber t-shirts and pants, as well as to allow the cutting of the fabric to occur in a GPT or former GPT “Schedule 2” country. 
 
In addition to this, any value that is added in a country with which Canada has a free trade agreement will be included in the value requirement as if it originated within the LDC. These measures will cover goods classified under the following HS subheadings: 
  • 6103.42 men’s or boys’ cotton pants (knit or crocheted)
  • 6103.43 men’s or boys’ synthetic-fiber pants (knit or crocheted)
  • 6104.62 women’s or girls’ cotton pants (knit or crocheted)
  • 6104.63 women’s or girls’ synthetic-fiber pants (knit or crocheted)
  • 6109.10 cotton T-shirts
  • 6109.90 other T-shirts
  • 6203.42 men’s or boys’ cotton pants (not knit or crocheted)
  • 6203.43 men’s or boys’ synthetic-fiber pants (not knit or crocheted)
  • 6204.62 women’s or girls’ cotton pants (not knit or crocheted)
  • 6204.63 women’s or girls’ synthetic-fiber pants (not knit or crocheted) 
The final wording of these changes will be reflected in the amended Regulations which are expected to be published shortly.
 
Watch this website for updates.
 

Source: Federal Budget 2017

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