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Orders Being Shipped Under North American Free Trade Agreement (NAFTA)

Posted by Kevin Suh, NetSuite Administrator on Oct 4, 2022 9:26:42 AM
Kevin Suh, NetSuite Administrator
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You might have encountered error/ notice: "There are no international customs documents to print for this fulfillment" when printing commercial invoice on Item Fulfillment. When shipping between US, Canada and Mexico, it is a requirement for NAFTA (North American Free Trade Agreement) Certificate of Origin to enter the criteria of the item being exported. What is NAFTA? And how does this impact you?   

 

The North American Free Trade Agreement (NAFTA) was an agreement signed by Canada, Mexico, and the United States that dates back to 1992. The agreement was due for a refresh, particularly in regard to technology, intellectual property and ecommerce and data protections. Other revisions include rules around labor and the environment. The auto industry, which relies heavily on the free flow of parts throughout North America, is most affected.  

In Netsuite, FedEx shipping integration enables you to electronically submit trade documents for international shipments. After you fulfill an order using FedEx, FedEx generates an electronic version of the trade documents and then transmits them with your shipment. PDF versions of the documents are attached to the fulfillment record order. FedEx can electronically generate and submit the NAFTA Certificate of Origin. To use the FedEx ETD service, enable the Shipping Label Integration feature: 

  1. Go to Setup >Accounting > Shipping > Preferences. 
  2. Select FedEx as the Default Shipping Carrier. 
  3. In the Preferences subtab, Carrier Basics section, check the International Shipping box. 
  4. Click Save. 

The NAFTA Preference Criteria is designated by the letters “A” through “F” which shows how the product qualifies for a NAFTA tariff rate. A preference criterion is required in Field # 7 of the Certificate of Origin for each export product. The NAFTA preference criteria are as follows: 

  • A – Natural resources, e.g., anything grown, harvested, fished, or mined in any one of the NAFTA countries
  • B – Manufactured goods that contain foreign parts, components, or raw materials and meet the requirements of its specific NAFTA Rule of Origin 
  • C – Goods manufactured exclusively with NAFTA originating parts or components 
  • D – Covers goods where the HS code for the product and its parts is the same and the manufacturer is allowed to use Regional Value Content to determine whether the good originates
  • E – HS code-specific Automatic Data Processing equipment 
  • F – Applies to certain “agricultural” products exported only to Mexico 

Once you have determined which criterion that product belongs into, select the letter in the Preference Criterion field in the Item record > Sales/Pricing tab > Shipping section. This requirement is triggered because NAFTA form requires these two fields. When the international shipment is NAFTA-based (which means the source and destination addresses are in NAFTA countries), the NAFTA form is required. NAFTA countries include United States of America, Canada and Mexico. After you print the shipping label for an order, FedEx generates the electronic trade documents and stores a PDF version on the Item Fulfillment record. You can use the print option, Print ETD Copy, available on the Item Fulfillment, if you want to print a paper copy of the trade documents for your reference.  

For further explanation of export solutions, please refer to https://www.export.gov/article?id=6-4-NAFTA-Preference-Criterion. If you want to learn more about shipping international or need help with the shipping integration, please contact Concentrus today to discuss your needs. 

 

 

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Tags: NetSuite, Reporting, NetSuite How To's, NetSuite Tips, Order Fulfillment, Shipping, NAFTA

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