Notice to Importers

Administration of the Canada-Costa Rica Free Trade Agreement Relating to Imports of Apparel, Textiles and Made-Up Goods from Costa Rica and the Application of the Tariff Preference Levels

Serial No. 636
Date: October 30, 2002

Table of Contents


1.0 Purpose

1.1 This Notice to Importers provides an explanation of the provisions of the Canada-Costa Rica Free Trade Agreement (CCRFTA) as they relate to apparel, textiles and made-up goods, and outlines the following Tariff Preference Level import quotas:

  1. apparel;
  2. cotton or man-made fibre fabrics and made-up goods;
  3. wool fabrics and made-up goods; and,
  4. cotton or man-made fibre spun yarns.

1.2 The CCRFTA enters into effect on November 1, 2002.

2.0 Duration

2.1 This Notice shall remain valid until further notice.

3.0 Authority

3.1 Tariff Preference Level or "TPL" means the special provisions set out in Annex III.1, Appendix III.1.6.1 of the CCRFTA, that provide for the application of a customs duty at a rate to non-originating goods up to a specified quantity, as adjusted under the Agreement, measured in square metre equivalents (SME) or kilograms (KGM) appropriately, and at a rate different from those goods that exceed that quantity. The Minister of Foreign Affairs issues Certificates to persons who are eligible for TPL under authority of the Export and Import Permits Act. The Minister allocates TPL quantities or "quota" to qualified applicants in accordance with the policy expressed in the present Notice.

4.0 FTA Provisions

4.1 Annex III.1 of the CCRFTA provides for the elimination of customs duty on originating apparel, textiles and made-up goods by November 1, 2002 between Costa Rica and Canada.

4.2 The Rules of Origin for apparel, textiles and made-up goods are set out in Annex IV.1, Section XI and Appendix III.1.6.1, Annex III.1. Although there are several specific exceptions, in general, the rule of origin may be described as a "yarn forward" rule, requiring the yarn, fabric and finished product to all originate from the CCRFTA countries, namely, Costa Rica and Canada. The exceptions range from a stricter "fibre forward" rule in the case of knit made-up articles to a less rigid "single transformation" rule in the case of brassieres.

4.3 Annex III.1, Section 6 and Appendix III.1.6.1 set out special provisions applicable to certain apparel, textiles and made-up goods. Under Appendix III.1.6.1, goods which would not otherwise satisfy the CCRFTA Rules of Origin (Annex IV.1), will nevertheless qualify for CCRFTA duty rates up to specified annual levels, called Tariff Preferential Levels. Above these levels, non-originating apparel, textiles and made-up goods will be subject to the Most-Favoured-Nation tariff rate.

5.0 TPL Levels

5.1 Importers should note that primary units of measure (other than for yarns) are converted into Square Metre Equivalents (SME) by means of conversion factors identified in Appendix III.1.6.2 of Annex III.1.

5.2 The annual TPL levels for imports of non-originating goods from Costa Rica to Canada under the CCRFTA are based on a calendar year as follows:

  1. Apparel goods: 1,300,000 SME;
  2. Cotton or man-made fabrics and made-up goods: 1,000,000 SME;
  3. Wool fabrics and made-up goods: 250,000 SME; and,
  4. Cotton or man-made fibre spun yarn: 150,000 KGM.

5.3 The TPL levels for the period November 1 to December 31, 2002 will be 2/12ths of the annual levels specified in paragraph 5.2.

5.4 The annual TPL for apparel goods will be increased annually by two per cent (2%) for three (3) consecutive years beginning January 1, 2003.

6.0 TPL Levels

6.1 Until further Notice, each of the TPLs will be made available on a "first-come-first-served" basis under the CCRFTA.

7.0 Enquiries

7.1 If you have an enquiry concerning this Notice or other administrative policies related to TPL-eligible goods under the CCRFTA, refer to Clothing & Textiles – Specific Enquires at Contact Us.

7.2 This Notice and other pertinent information are available on the following Internet site: List of Notices to Importers/Exporters

7.3 The Canada-Costa Rica Free Trade Agreement is available on the Global Affairs Canada website.