International Foreign Trades Agreements (FTAs) promote regional economic integration and build shared approaches to trade and investment. FTAs don’t just eliminate tariffs, they also address behind-the-border barriers that impede the flow of goods and services between parties. FTAs ensure that goods are given preferential treatment in partner countries by way of tariff elimination or reduction. This increases the competitiveness of products exported by businesses to a FTA partner country. The degree of tariff advantage you receive from an FTA therefore depends on your product. This is why FTA tariff rates may be a determining factor in entering a market in some cases but not in others. You still have to make sure there is a need for your product or service, that you have a unique selling proposition, and that you can deliver your offering in a way that meets customer needs. Besides preferential tariff rate, Trade agreements help level the international playing, and encourage foreign governments to adopt open and transparent rule making procedures, as well as non-discriminatory laws and regulations. FTAs help strengthen business climates by eliminating or reducing tariff rates, improving intellectual property regulations and opening government procurement opportunities.

Assistance in Taking Full Advantage of FTA

The proliferation of multilateral and bilateral FTAs over the last few years means that your products are now effectively competing with rival products from all over the world. In this situation, taking full advantage of free trade agreements is imperative to stay competitive. However, in a recent KPMG study it is reported that “70% of companies do not fully utilize Free Trade Agreements.” 

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Rules of Origin Compliance Service

Preferential rules of origin are applied by countries that offer certain trade partners zero-duty or reduced-duty access for their imports as a means of determining the eligibility of products to receive such preferential access. In a globalized world with complex supply chains, it may be difficult to determine where a product originates. In order to take advantage these agreements, it is essential that a product’s originating status be clearly defined.

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Collecting & Analyzing Certificate of Origin

In order to take advantage of Canadian international agreements, it is essential that all of your suppliers should be able to provide you a valid certificate of origin each year. The burden on an importer like you is to make sure a valid FTA certification is in your possession when you make the claim for FTA benefits. 

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Reducing FTA’s  Non Compliance Risk

Free trade agreements do not mean an “open border” with regard to the compliance requirements for merchandise trade among the parties. Complying with rules of origin and other requirements is sometimes so complicated and time-consuming that companies find it’s not worth the trouble or the risk of penalties for non-compliance.

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