To qualify for NAFTA Criterion C, what is required of the goods?

To qualify for NAFTA Criterion C, which pertains to the rules of origin under the North American Free Trade Agreement, goods must be produced entirely from originating materials within the NAFTA countries. This means that all raw materials and components used in the production process must be sourced from Canada, Mexico, or the United States. The purpose of this criterion is to ensure that the goods not only have substantial transformation but also that they are fundamentally sourced from within the region, promoting trade between these countries and discouraging the import of non-regional materials.

This emphasis on using exclusively originating materials is crucial for businesses seeking to benefit from tariff reductions under NAFTA, as it ensures that the end products are considered North American and thereby entitled to preferential tariff treatment. In contrast, other options do not align with the requirements set forth in NAFTA Criterion C, as they either involve sourcing from outside the NAFTA region or do not stipulate the exclusive use of originating materials.