Definitions Specific to Canada

Appendix 10.1

Country-Specific Definitions

general import statistics means statistics issued by Statistics Canada or, where available, import permit data provided by the Export and Import Permits Bureau of the Department of External Affairs and International Trade, or their successors.

Definitions Specific to Mexico

general import statistics means the statistics of the "Sistema de Informacion Comercial" (Trade Information System) or its successor.

Definitions Specific to the United States

category means a grouping of textile or apparel goods defined in the Correlation: Textile and Apparel Categories with the Harmonized Tariff Schedule of the United States, 1992 (or successor publication), published by the United States Department of Commerce, International Trade Administration, Office of Textiles and Apparel, Trade and Data Division, Washington, D.C.; and

general import statistics means statistics of the U.S. Bureau of the Census or its

successor.

Chapter Four

Rules of Origin

Article 401: Originating Goods

Except as otherwise provided in this Chapter, a good shall originate in the territory of a Party where:

(a)

(b)

(c)

(d)

the good is wholly obtained or produced entirely in the territory of one or more of the Parties, as defined in Article 415;

each of the non-originating materials used in the production of the good undergoes an applicable change in tariff classification set out in Annex 401 as a result of production occurring entirely in the territory of one or more of the Parties, or the good otherwise satisfies the applicable requirements of that Annex where no change in tariff classification is required, and the good satisfies all other applicable requirements of this Chapter;

the good is produced entirely in the territory of one or more of the Parties exclusively from originating materials; or

except for a good provided for in Chapters 61 through 63 of the Harmonized System, the good is produced entirely in the territory of one or more of the Parties but one or more of the non-originating materials provided for as parts under the Harmonized System that are used in the production of the good does not undergo a change in tariff classification because

(i)

(ii)

the good was imported into the territory of a Party in an unassembled or a disassembled form but was classified as an assembled good pursuant to General Rule of Interpretation 2(a) of the Harmonized System, or

the heading for the good provides for and specifically describes both the good itself and its parts and is not further subdivided into subheadings, or the subheading for the good provides for and specifically describes both the good itself and its parts,

provided that the regional value content of the good, determined in accordance with Article 402, is not less than 60 percent where the transaction value method is used, or is not less than 50 percent where the

net cost method is used, and that the good satisfies all other applicable requirements of this Chapter.

Article 402: Regional Value Content

1. Except as provided in paragraph 5, each Party shall provide that the regional value content of a good shall be calculated, at the choice of the exporter or producer of the good, on the basis of either the transaction value method set out in paragraph 2 or the net cost method set out in paragraph 3.

2.

Each Party shall provide that an exporter or producer may calculate the regional value content of a good on the basis of the following transaction value method:

3.

TV

VNM

is the transaction value of the good adjusted to a F.O.B. basis; and

is the value of non-originating materials used by the producer in the production of the good.

Each Party shall provide that an exporter or producer may calculate the regional value content of a good on the basis of the following net cost method: