NAFTA: Annexes

and Investment in the Automotive Industry Sector

1. Except as provided in this Annex, each Party shall apply this Agreement to automotive goods of another Party and to enterprises of the automotive industry sector in its territory.
2. Except as provided in this Annex, each Party shall promptly accord to existing producers of vehicles in its territory treatment no less favorable than that it accords, in like circumstances, to a new producer of vehicles in its territory regarding measures covered by this Annex.
3. The Parties shall review, no later than December 31, 2003, the status of the North American automotive industry sector and the effectiveness of the measures contained in this Annex to determine actions that could be taken to strengthen the integration and global competitiveness of the industry.
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Appendix A: Canada
Existing Measures
1. Canada and the United States may maintain the Agreement Concerning Automotive Products between the Government of Canada and the Government of the United States of America which entered into force on September 16, 1966, in accordance with Article 1001, Article 1002(1) and (4) (as they refer to Annex 1002.1, Part One), Article 1005(1) and (3), and Annex 1002.1, Part One (Waivers of Customs Duties) of Canada - United States Free Trade Agreement.
2. Canada may maintain the measures referred to in Article 1002(1) and (4) (as they refer to Annex 1002.1, Parts Two and Three), Article 1002(2) and (3), Article 1003, and Annex 1002.1, Parts Two (Export-Based Waivers of Customs Duties) and Three (Production-Based Waivers of Customs Duties) of the Canada - United States Free Trade Agreement. Canada shall eliminate those measures in accordance with the terms set out in that agreement.
Used Vehicles
3. Canada may adopt or maintain prohibitions and restrictions on imports of used vehicles from the territory of Mexico, except as follows:
(a) after January 1, 2009, Canada may not adopt or maintain prohibitions or restrictions on imports from the territory of Mexico of originating used vehicles that are at least 10 years old;
(b) after January 1, 2011, Canada may not adopt or maintain prohibitions or restrictions on imports from the territory of Mexico of originating used vehicles that are at least eight years old;
(c) after January 1, 2013, Canada may not adopt or maintain prohibitions or restrictions on imports from the territory of Mexico of originating used vehicles that are at least six years old;
(d) after January 1, 2015, Canada may not adopt or maintain prohibitions or restrictions on imports from the territory of Mexico of originating used vehicles that are at least four years old;
(e) after January 1, 2017, Canada may not adopt or maintain prohibitions or restrictions on imports from the territory of Mexico of originating used vehicles that are at least two years old; and
(f) after January 1, 2019, Canada may not adopt or maintain prohibitions or restrictions on imports from the territory of Mexico of originating used vehicles regardless of age.
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Appendix B: Mexico
Auto Decree and Auto Decree Implementing Regulations
1. Subject to this Appendix, Mexico may maintain, until January 1, 2004, the Decree for Development and Modernization of the Automotive Industry ("Decreto para el Fomento y Modernizaci��n de la Industria Automotriz") (December 11, 1989) (the "Auto Decree") and the Resolution that Establishes Rules for the Implementation of the Auto Decree ("Acuerdo que Determina Reglas para la Aplicaci��n para el Fomento y Modernizaci��n de la Industria Automotriz") (November 30, 1990) (the "Auto Decree Implementing Regulations"). Mexico may adopt or maintain any measure respecting automotive goods or manufacturers of automotive goods in its territory provided that such measure is not inconsistent with this Agreement.
Autoparts Industry, National Suppliers and Independent Maquiladoras
2. Mexico may not require that an enterprise attain a level of national value added in excess of 20 percent of its total sales as one of the conditions to qualify as a national supplier or enterprise of the autoparts industry.
2a. For purposes of paragraph 2, "national value added" means the total value of sales of such enterprises (excluding those for the aftermarket) minus the value of its total imports, direct and indirect, excluding those imports incorporated in aftermarket parts and components, as modified by paragraph 3.
3. Mexico may require that a national supplier or an enterprise of the autoparts industry, in calculating its national value added solely for the purposes of paragraph 2, include customs duties in the value of imports incorporated into the parts and components produced by such enterprises.
4. Mexico shall grant national supplier status to an independent maquiladora that requests such status and meets the requirements for that status set out in the existing Auto Decree. Mexico shall continue to grant to all independent maquiladoras that request national supplier status all existing rights and privileges accorded to independent maquiladoras under the existing Decree for the Promotion and Operation of the Maquiladora Export Industry ("Decreto para el Fomento y Operaci��n de la Industria Maquiladora de Exportaci��n")