NAFTA: Annexes | Page 5

provided for in Article 2 of the Autotransportation Decree).
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Appendix C: United States
Corporate Average Fuel Economy
1. As provided in paragraph 2, for purposes of the Energy Policy and Conservation Act (October 1975), as amended ("the CAFE Act"), the United States shall consider an automobile to be domestically manufactured in any model year if at least 75 percent of the cost to the manufacturer of such automobile is attributable to value added in Canada, Mexico or the United States, unless the assembly of such automobile is completed in Canada or Mexico and such automobile is not imported into the United States prior to the expiration of the 30 days following the end of such model year.
2. The United States shall implement the obligation set out in paragraph 1 for all automobiles of a manufacturer sold in the United States, wherever produced and irrespective of car line or truck line, beginning with the next model year after January 1, 2004, except as provided in the following schedule:
(a) with respect to a manufacturer that initiated the manufacture of automobiles in Mexico before model year 1992, the enterprise that provides certification under the CAFE Act may make a one-time election at any time between January 1, 1997 and January 1, 2004, to have paragraph 1 applied beginning with the next model year after such election; (b) with respect to a manufacturer initiating the manufacture of automobiles in Mexico after model year 1991, paragraph 1 shall apply beginning with the next model year after either January 1, 1994 or the date that such manufacturer initiates manufacturing automobiles in Mexico, whichever is later; (c) with respect to any other manufacturer of automobiles in the territory of a Party, the enterprise that provides certification under the CAFE Act may make a one-time election at any time between January 1, 1997 and January 1, 2004, to have paragraph 1 applied beginning with the next model year after such election. If such a manufacturer initiates manufacturing automobiles in Mexico, it shall be subject to subparagraph (b) on the date it initiates such manufacturing; and (d) with respect to all manufacturers of automobiles not manufacturing automobiles in the territory of a Party, paragraph 1 shall apply beginning with the next model year after January 1, 1994. 3. The United States shall make any future changes pertaining to the definition of domestic production in the CAFE Act or its implementing regulations equally applicable to value added in any of the Parties.
4. Nothing in this Appendix shall require the United States to make any changes in its fuel economy requirements for automobiles.
5. For purposes of this Appendix, "automobile" means a motor vehicle that complies with the definition in the CAFE Act and its implementing regulations.
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Appendix D: General Definitions existing producer of vehicles means a producer that was producing in the territory of the relevant Party prior to model year 1992; and automotive goods means all types of motor vehicles, and parts and components intended for use in motor vehicles. Note: (Additional terms may be added where appropriate)
ANNEX 300-B Textile and Apparel Goods
Section 1: Scope and Coverage
1. This Annex applies to the textile and apparel goods set out in Appendix 1.1.
2. In the event of any inconsistency between this Agreement and the Arrangement Regarding International Trade in Textiles (Multifiber Arrangement), as amended and extended, including any amendment or extension after the date of entry into force of this Agreement, or any other existing or future agreement applicable to trade in textile or apparel goods, this Agreement shall prevail to the extent of the inconsistency, unless the Parties agree otherwise.
Section 2: Tariff Elimination
1. Except as otherwise provided in this Agreement , each Party shall progressively eliminate its customs duties on originating goods as provided in its Schedule set out in Annex 302.2, in accordance with Appendix 2.1.
2. (a) For purposes of this Annex, a good shall be considered to be an originating good if the applicable change in tariff classification has been satisfied in the territory of one or more of the Parties, as provided by Article 404.
(b) For purposes of determining which rate of duty and staging category is applicable to an originating textile or apparel good, a good shall be a good of the Party in which the last substantial transformation occurred, according to each importing Party's regulations, practices or procedures or, in the event of an agreement between the Parties pursuant to Annex 312(1), setting out rules applicable to textile and apparel goods for determining whether a good is a good of a Party ("Marking Rules"), according to such agreement.
3. Each Party shall provide duty-free treatment for the following textile and apparel goods of another Party, provided such goods have been certified by the competent authority of the exporting Party as one of the following:
(a) hand-loomed fabrics of a cottage industry;
(b) hand-made