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NAFTA: Specific Rules of Origin
List of Amendments to NAFTA Annex 401

January 1, 2003

NAFTA Annex 401 (January 1, 2003)
Other versions of Annex 401  


Alcoholic Beverages - Heading 22.03-22.09

Explanation: The new rules allow certain goods produced by mixing small quantities of non-NAFTA alcoholic beverages with NAFTA originating alcoholic beverages to qualify for NAFTA preferences.

New rules of origin:

22.03-22.07 A change to heading 22.03 through 22.07 from any heading outside that group, except from tariff item 2106.90.ee or heading 22.08 through 22.09.
2208.20 A change to subheading 2208.20 from any other heading, except from tariff item 2106.90.ee or heading 22.03 through 22.07 or 22.09.
2208.30-2208.70 No required change in tariff classification to subheading 2208.30 through 2208.70, provided that the non-originating alcoholic ingredients constitute no more than 10 percent of the alcoholic content of the good by volume.
2208.90 A change to subheading 2208.90 from any other heading, except from tariff item 2106.90.ee or heading 22.03 through 22.07 or 22.09.
22.09 A change to heading 22.09 from any other heading, except from tariff item 2106.90.ee or heading 22.03 through 22.08.

Petroleum/Topped Crude - Heading 27.10-27.15

Explanation: The new rule of origin specifies a number of processes which confers NAFTA origin and provides definitions of those processes in a Chapter Note.

New rule of origin:

27.10 A change to heading 27.10 from any other heading, except from heading 27.11 through 27.15; or

Production of any good of heading 27.10 as the result of atmospheric distillation, vacuum distillation, catalytic hydroprocessing, catalytic reforming, alkylation, catalytic cracking, thermal cracking, coking or isomerization.

27.11-27.15 A change to heading 27.11 through 27.15 from any heading outside that group, except from heading 27.10.

Chapter Note for Chapter 27:

Note: For the purposes of heading 27.10, the following processes confer origin:
  1. Atmospheric distillation - A separation process in which petroleum oils are converted, in a distillation tower, into fractions according to boiling point and the vapor then condensed into different liquefied fractions. Liquefied petroleum gas, naphtha, gasoline, kerosene, diesel/heating oil, light gas oils, and lubricating oil are produced from petroleum distillation;
  2. Vacuum distillation - Distillation at a pressure below atmospheric but not so low that it would be classed as molecular distillation. Vacuum distillation is useful for distilling high-boiling and heat-sensitive materials such as heavy distillates in petroleum oils to produce light to heavy vacuum gas oils and residuum. In some refineries gas oils may be further processed into lubricating oils;
  3. Catalytic hydroprocessing - The cracking and/or treating of petroleum oils with hydrogen at high temperature and under pressure, in the presence of special catalysts. Catalytic hydroprocessing includes hydrocracking and hydrotreating;
  4. Reforming (catalytic reforming) - The rearrangment of molecules in a naphtha boiling range material to form higher octane aromatics (i.e., improved antiknock quality at the expense of gasoline yield). A main product is catalytic reformate, a blend component for gasoline. Hydrogen is another by-product;
  5. Alkylation - A process whereby a high-octane blending component for gasolines is derived from catalytic combination of an isoparaffin and an olefin;
  6. Cracking - A refining process involving decomposition and molecular recombination of organic compounds, especially hydrocarbons obtained by means of heat, to form molecules suitable for motor fuels, monomers, petrochemicals, etc.:
    1. Thermal cracking - Exposes the distillate to temperatures of approximately 540-650C (1000-1200F) for varying periods of time. Process produces modest yields of gasoline and higher yields of residual products for fuel oil blending,
    2. Catalytic cracking - Hydrocarbon vapors are passed at approximately 400C (750F) over a metallic catalyst (e.g., silica-alumina or platinum); the complex recombinations (alkylation, polymerization, isomerization, etc.) occur within seconds to yield high-octane gasoline. Process yields less residual oils and light gases than thermal cracking;
  7. Coking - A thermal cracking process for the conversion of heavy low grade products, such as reduced crude, straight run pitch, cracked tars, and shale oil into solid coke (carbon) and lower boiling hydrocarbon products which are suitable as feed for other refinery units for conversion into lighter products; and
  8. Isomerization - The refinery process of converting petroleum compounds into their isomers.


Source: International Trade Canada