Which of the following statements is correct about NAFTA?Group of answer choicesIt is no longer necessary to produce a certificate of origin when moving goods internally within NAFTA across its two internal bordersAll options are correctSince a certificate of origin is the responsibility of the exporter, the importer need not be concerned about the form or content of the certificate.The basis for tariff classification under NAFTA is the Harmonized Commodity Description and Coding System (HS); this system has been adopted by most of the world’s major trading countries.
Question
Which of the following statements is correct about NAFTA?Group of answer choicesIt is no longer necessary to produce a certificate of origin when moving goods internally within NAFTA across its two internal bordersAll options are correctSince a certificate of origin is the responsibility of the exporter, the importer need not be concerned about the form or content of the certificate.The basis for tariff classification under NAFTA is the Harmonized Commodity Description and Coding System (HS); this system has been adopted by most of the world’s major trading countries.
Solution
The correct statement about NAFTA is "The basis for tariff classification under NAFTA is the Harmonized Commodity Description and Coding System (HS); this system has been adopted by most of the world’s major trading countries."
This is because NAFTA, like many other international trade agreements, uses the Harmonized System to classify goods for the purpose of levying tariffs. The Harmonized System is a standardized system of names and numbers to classify traded products, and it is used by customs authorities around the world to identify products for the application of tariffs and other trade measures.
The other statements are incorrect. A certificate of origin is still necessary when moving goods within NAFTA across its internal borders. This document certifies that the goods being exported are wholly obtained, produced, manufactured or processed in a particular country. Both the exporter and the importer need to be concerned about the form and content of the certificate, as it is a crucial document for customs clearance.
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