Does USMCA exempt you from Section 122?

Yes, but only if the goods actually qualify. USMCA-originating goods from Canada and Mexico are generally carved out of the Section 122 baseline surcharge, provided they meet the USMCA rules of origin and the importer holds a valid certificate of origin. Shipping from a Canadian or Mexican address is not, by itself, enough. A product that was made in China, routed through Monterrey for repackaging, and trucked across the border still owes the surcharge — because it never became a USMCA-originating good in the first place.

That distinction trips up a lot of importers who assume the exemption is about geography. It isn't. It's about origin, and origin has to be earned and documented, not assumed. Here's how the carve-out actually works, what counts as a qualifying good, and what a USMCA certificate of origin needs to contain to survive a CBP review.

What Section 122 is, in brief

Section 122 of the Trade Act of 1974 gives the President authority to impose a temporary import surcharge, capped at 15%, to address a balance-of-payments problem. In February 2026 the administration invoked it to impose a 10% ad valorem surcharge on imports generally, after the Supreme Court's ruling on the earlier IEEPA-based tariffs. The measure carries a statutory 150-day limit from its effective date, so its exact status shifts on its own schedule — always check the current Federal Register proclamation and any subsequent extension before you rely on a specific rate or expiry date.

How the USMCA carve-out actually works

The proclamation that imposed the Section 122 surcharge exempted goods that enter duty-free under USMCA — the agreement referenced in General Note 11 to the Harmonized Tariff Schedule. That note is the legal home of USMCA preference: it lists the rules a good has to satisfy to be treated as originating in the US, Canada or Mexico. If a product meets those rules and is properly certified, it's outside the surcharge. If it doesn't, the surcharge applies regardless of which port or land crossing it entered through.

This is also why the carve-out is narrower than it sounds. USMCA doesn't wave through everything crossing the northern or southern border — only the subset of goods that were actually produced, or sufficiently transformed, within the three-country bloc under the agreement's specific rules. A Seattle outdoor-gear importer sourcing tents assembled in Tijuana from Chinese-cut fabric panels needs to check the applicable product-specific rule before assuming the Mexican assembly step clears the bar. In many cases, simple cut-and-sew assembly of foreign fabric doesn't meet the USMCA textile rules of origin, even though the finished tents leave from a Mexican factory.

What counts as a USMCA-originating good?

USMCA rules of origin work through a handful of origin criteria, and every qualifying good has to satisfy at least one of them. The agreement's product-specific rules (found in Annex 4-B) tell you which criterion applies to a given HS heading — a T-shirt and a car engine are judged by completely different tests. At a plain-English level, the main categories look like this.

Automotive goods run on their own, stricter version of this system — regional value content thresholds, labour-value content requirements, and steel and aluminum purchasing rules that go well beyond the general tests above. If you import vehicles or auto parts, treat that as its own compliance project rather than assuming the general table applies.

What do I actually need on a USMCA certificate of origin?

There's no official government form for this anymore. The old NAFTA-style Certificate of Origin and CBP Form 434 stopped being accepted when USMCA replaced NAFTA in 2020. What CBP requires instead is a set of nine specific data elements, which can appear on almost any document — a standalone certificate, a commercial invoice, or a packing list, as long as everything is there and legible.

• Certifier — whether the importer, exporter, or producer is making the certification.
• Exporter name, address and, where applicable, tax ID.
• Producer name and address, if different from the exporter.
• Importer name and address.
• A description of the good and its HS classification, detailed enough to identify it.
• The origin criterion the good qualifies under (matching the categories above).
• A blanket period, if the certification covers multiple shipments of identical goods over up to twelve months.
• An authorised signature and date.
• A statement certifying the good is originating and the certifier accepts responsibility for the claim.

The paperwork burden dropped, but the accuracy burden didn't. A one-page invoice with all nine elements holds up fine in a CBP review. A missing origin criterion or an unsigned blanket period doesn't — and that's still the single most common reason we see USMCA claims get denied at verification.

One quirk worth knowing: the certificate doesn't have to travel with the shipment. The importer just has to be able to produce it — along with the underlying bill of materials, production records, or supplier declarations that support the origin claim — if CBP asks. Many importers keep a standing blanket certificate on file with a regular supplier and update it annually, rather than generating a new one for every container.

Where importers actually lose the exemption

In practice, the Section 122 USMCA carve-out gets lost in a handful of predictable ways, and none of them are exotic loopholes CBP hasn't seen before.

1. Transshipment — goods made elsewhere are routed through Canada or Mexico with minimal processing, hoping the border crossing alone confers origin. It doesn't.
2. Insufficient transformation — a genuine manufacturing step happens in Mexico or Canada, but it falls short of the specific tariff-shift or RVC rule for that HS heading.
3. Missing or incomplete certification — the shipment would qualify, but the importer can't produce a certificate with all nine data elements when CBP asks.
4. Confusing preferential origin with non-preferential origin — a good can be "Made in Mexico" for country-of-origin marking purposes without meeting the tighter USMCA rules of origin needed for tariff preference.

The stakes here are real money, not paperwork trivia. On a container of goods valued at $150,000, a 10% surcharge that shouldn't have applied is $15,000 — and if it should have applied and you claimed the exemption anyway, that's a false preference claim CBP can penalise separately from the duty itself.

Does the exemption cover everything from Canada and Mexico?

No — and this is the second trap after transshipment. The Section 122 carve-out is specific to that one measure. It doesn't extend to Section 232 steel and aluminum tariffs, which apply based on the material content of the product rather than USMCA origin. A Canadian-made aluminum extrusion can be genuinely USMCA-originating, fully exempt from Section 122, and still carry a Section 232 duty on the same entry. Treat every applicable tariff programme as its own question with its own origin and product tests, rather than assuming one exemption clears the whole stack.

Getting this right before you file

If you import from Canada or Mexico, the practical sequence is straightforward. Classify the good to its HS heading, find the applicable product-specific rule in Annex 4-B, confirm your supply chain actually meets it, and get a properly formatted certificate of origin on file before the goods move — not scrambled together after a CBP request. None of that is a formality you can skip because the goods feel North American; CBP verification requests on USMCA claims are common, and the burden of proof sits with the importer, not the agency.

Section 122's rate, scope and expiry are all live policy details that have moved more than once since the surcharge was first imposed in February 2026. Nothing here should be read as a customs ruling or legal advice — for a specific shipment, verify the current proclamation status against the Federal Register and, for a binding origin determination, consult a licensed customs broker or request a CBP ruling.