Article 506: Origin Verifications
1. For purposes of determining whether a good imported into its
territory from the territory of another Party qualifies as an
originating good, a Party may, through its customs administration,
conduct a verification solely by means of:
a) written questionnaires to an exporter or a producer in the
territory of another Party;
b) visits to the premises of an exporter or a producer in the
territory of another Party to review the records referred to in
Article 505(a) and observe the facilities used in the production
of the good; or
c) such other procedure as the Parties may agree.
2. Prior to conducting a verification visit pursuant to paragraph
(1)(b), a Party shall, through its customs administration:
a) deliver a written notification of its intention to conduct
the visit to
(i) the exporter or producer whose premises are to be visited,
(ii) the customs administration of the Party in whose territory
the visit is to occur, and
(iii) if requested by the Party in whose territory the visit is
to occur, the embassy of that Party in the territory of the Party
proposing to conduct the visit; and
(b) obtain the written consent of the exporter or producer whose
premises are to be visited.
3. The notification referred to in paragraph 2 shall include:
a) the identity of the customs administration issuing the notification;
(b) the name of the exporter or producer whose premises are to
be visited;
c) the date and place of the proposed verification visit;
d) the object and scope of the proposed verification visit, including
specific reference to the good that is the subject of the verification;
e) the names and titles of the officials performing the verification
visit; and
f) the legal authority for the verification visit.
4. Where an exporter or a producer has not given its written consent
to a proposed verification visit within 30 days of receipt of
notification pursuant to paragraph 2, the notifying Party may
deny preferential tariff treatment to the good that would have
been the subject of the visit.
5. Each Party shall provide that, where its customs administration
receives notification pursuant to paragraph 2, the customs administration
may, within 15 days of receipt of the notification, postpone the
proposed verification visit for a period not exceeding 60 days
from the date of such receipt, or for such longer period as the
Parties may agree.
6. A Party shall not deny preferential tariff treatment to a good
based solely on the postponement of a verification visit pursuant
to paragraph 5.
7. Each Party shall permit an exporter or a producer whose good
is the subject of a verification visit by another Party to designate
two observers to be present during the visit, provided that:
a) the observers do not participate in a manner other than as
observers; and
b) the failure of the exporter or producer to designate observers
shall not result in the postponement of the visit.
8. Each Party shall, through its customs administration, conduct
a verification of a regional value-content requirement in accordance
with the Generally Accepted Accounting Principles applied in the
territory of the Party from which the good was exported.
9. The Party conducting a verification shall provide the exporter
or producer whose good is the subject of the verification with
a written determination of whether the good qualifies as an originating
good, including findings of fact and the legal basis for the determination.
10. Where verifications by a Party indicate a pattern of conduct
by an exporter or a producer of false or unsupported representations
that a good imported into its territory qualifies as an originating
good, the Party may withhold preferential tariff treatment to
identical goods exported or produced by such person until that
person establishes compliance with Chapter Four (Rules of Origin).
11. Each Party shall provide that where it determines that a certain
good imported into its territory does not qualify as an originating
good based on a tariff classification or a value applied by the
Party to one or more materials used in the production of the good,
which differs from the tariff classification or value applied
to the materials by the Party from whose territory the good was
exported, the Party's determination shall not become effective
until it notifies in writing both the importer of the good and
the person that completed and signed the Certificate of Origin
for the good of its determination.
12. A Party shall not apply a determination made under paragraph
11 to an importation made before the effective date of the determination
where:
a) the customs administration of the Party from whose territory
the good was exported has issued an advance ruling under Article 509 or any other ruling on the tariff classification or on the value of such materials, or has given
consistent treatment to the entry of the materials under the tariff
classification or value at issue, on which a person is entitled to rely; and
b) the advance ruling or consistent treatment was given prior
to notification of the determination.
13. If a Party denies preferential tariff treatment to a good
pursuant to a determination made under paragraph 11, it shall
postpone the effective date of the denial for a period not exceeding
90 days where the importer of the good, or the person who completed
and signed the Certificate of Origin for the good, demonstrates
that it has relied in good faith to its detriment on the tariff
classification or value applied to such materials by the customs
administration of the Party from whose territory the good was
exported.
Article 507: Confidentiality
1. Each Party shall maintain, in accordance with its law, the
confidentiality of confidential business information collected
pursuant to this Chapter and shall protect that information from
disclosure that could prejudice the competitive position of the
persons providing the information.
2. The confidential business information collected pursuant to
this Chapter may only be disclosed to those authorities responsible
for the administration and enforcement of determinations of origin,
and of customs and revenue matters.
Article 508: Penalties
1. Each Party shall maintain measures imposing criminal, civil
or administrative penalties for violations of its laws and regulations
relating to this Chapter.
2. Nothing in Articles 502(2), 504(3) or 506(6) shall be construed
to prevent a Party from applying such measures as the circumstances
may warrant.
Continue on to Article 509: Advance Rulings