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Legal Guide

The North American Free Trade Agreement (“NAFTA”) among Canada, the US and Mexico, contains provisions aimed at ensuring that product standards, certification and testing procedures, do not create unnecessary barriers to North American trade in goods and some services. The basic principle is that a NAFTA country is not to maintain or introduce any standards-related measures or procedures of product testing, or certification that would create unnecessary obstacles to trade. Measures or procedures designed to protect health, safety, environmental or consumer interests, are deemed not to be unnecessary obstacles to trade, as long as they do not operate to exclude products of a NAFTA country, where those products would otherwise meet the permitted domestic regulatory objectives.

The NAFTA does not require that Canadian, US and Mexican standards be identical, only that domestic standards and product approval procedures be applied equally to goods originating in any NAFTA country.

Of great practical importance to the introduction of products into new markets are often a foreign country’s requirements for testing and approval of those products. Under the Canada-US Free Trade Agreement, those two countries agreed not to require that testing facilities, inspection agencies or certification bodies, be located or established within the importing country. The NAFTA contains a similar provision, albeit more qualified, vis-à-vis Mexico.

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