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CHAPTER SIXTEEN

(TEMPORARY ENTRY FOR BUSINESS PERSONS)

OF THE

NORTH AMERICAN FREE TRADE AGREEMENT (NAFTA)

What is Chapter Sixteen of the NAFTA and what does it do?

Who benefits from Chapter Sixteen of the NAFTA?

How can Chapter Sixteen of the NAFTA help me or my company?

Can the U.S. Government help me if I have a problem?

How can I get more information?

What is Chapter Sixteen of the NAFTA and what does it do?

Under Chapter Sixteen of the North American Free Trade Agreement (NAFTA), the three NAFTA countries - the United States, Canada and Mexico - agreed to facilitate the temporary entry of each other's business persons. The provisions of this Chapter apply to business visitors, treaty traders and investors, intra-company transferees and certain professionals.

The NAFTA entered into force on January 1, 1994. It has no expiration date.

Who benefits from Chapter Sixteen of the NAFTA?

A U.S. business person in one of the categories covered by Chapter Sixteen who will be engaged in trade of goods, provision of services, or the conduct of investment activities in Canada or Mexico can benefit from this Chapter. So can an American company or other organization that needs the services of qualifying Canadian or Mexican business persons for temporary periods.

How can Chapter Sixteen of the NAFTA help me or my company?

Chapter Sixteen simplifies admission procedures, and in some cases eases the requirements for prior approvals and labor certifications, for business persons from NAFTA countries. To benefit from the Chapter's provisions, the business person must be a citizen of a NAFTA country and must otherwise comply with the immigration requirements of the country where he/she will be engaged in business activity (for example, requirements relating to public health and safety or to national security). "Temporary entry" is defined in the Chapter as entry without the intent to establish permanent residence. Temporary entry can be refused if it could adversely affect the settlement of a labor dispute in progress at the person's intended place of employment, or the employment of any person involved in such a dispute.

To benefit from the provisions of Chapter Sixteen, a NAFTA citizen must be able to qualify as one of four types of business persons:

Business Visitors

A business visitor is a person engaged in international business activities related to research and design, growth, manufacture and production, marketing, sales, distribution, after-sales service (provided it is pursuant to a warranty or service contract), and other general services (like financial services, public relations, tourism and translation services). Appendix 1603 A.1. lists the qualifying business activities that are covered by Chapter Sixteen. The business visitor must be able to demonstrate that the primary source of remuneration is from outside the country he/she seeks to enter, and that his/her principal place of business will remain outside that country.

For temporary entry into Canada, a business visitor from the United States or Mexico generally does not need to obtain immigration documentation as long as he/she meets the qualifications described above. The visitor will be asked at the border for a statement of purpose and length of stay.

For temporary entry into Mexico, a business visitor from Canada or the United States must complete an FMN (Formulario Migratorio NAFTA) form, which is available at no cost at all ports-of-entry and is valid for 30 days. A business visitor who wishes to remain longer than 30 days must obtain a business visa which is valid for multiple entries for one year and can be renewed for four additional years, when a new visa must be requested.

For temporary entry into the United States, a business visitor from Canada does not need a visa, but he/she must submit evidence to U.S. immigration officials at the port-of-entry which shows that he/she qualifies as a business visitor under Chapter Sixteen. A Mexican business visitor must obtain a nonimmigrant (B-1) visa or a Border Crossing Card from a U.S. embassy or consulate before applying for admission at a port-of-entry. Canadian and Mexican business visitors may be admitted for the period necessary to engage in the intended activity, not to exceed one year. The stay can be extended by filing a petition at a local office of the U.S. Immigration and Naturalization Service.

Treaty Traders and Investors

A treaty trader is a person in a supervisory or executive position, or one that involves essential skills, who is seeking to carry on substantial trade in goods or services (at least 50% of the international trade of the trading entity) principally between the NAFTA country of which he/she is a citizen and the other NAFTA country which he/she wishes to enter. A treaty investor is a person in a supervisory or executive position, or one that involves essential skills, who seeks to establish, develop or administer an investment, or to provide advice or key technical services to the operation of an investment. The business person or his/her company must have committed, or must be in the process of committing, a substantial amount of capital to the investment. For entry into the United States, at least 50% of the business must be owned by a Mexican or Canadian citizen (or citizens).

For temporary entry into Canada, a trader or investor from the United States or Mexico must complete an Application for Employment Authorization form and an Application for Trader/Investor Status at a Canadian embassy or consulate before leaving for Canada.

For temporary entry into Mexico, a trader or investor from Canada or the United States must obtain a business visa from a Mexican embassy or consulate, or in Mexico. This visa is valid for multiple entries for one year and can be renewed for four additional years, when a new visa may be obtained.

For temporary entry into the United States, a trader or investor from Canada or Mexico must obtain a Treaty Trader (E-1) or Treaty Investor (E-2) nonimmigrant visa from a U.S. embassy or consulate before applying for admission at a port-of-entry.

Intra-Company Transferees

An intra-company transferee is a person employed in a managerial or executive position, or one that requires specialized knowledge, at a company in a NAFTA country who will be providing services to a parent, branch, subsidiary or affiliate of that company in another NAFTA country. The person must have been employed in his/her company for at least one of the three years preceding an application for temporary entry.

For temporary entry into Canada, an intra-company transferee from the United States or Mexico must complete an Application for Employment Authorization form at a Canadian embassy or consulate before leaving for Canada, or apply directly at a Canadian port-of-entry. The employment authorization is initially issued for one year, and extensions may be granted in increments of two years.

For temporary entry into Mexico, an intra-company transferee from Canada or the United States must obtain a business visa from a Mexican embassy or consulate, or in Mexico. This visa is valid for multiple entries for one year and can be renewed for four additional years, when a new visa may be obtained.

For temporary entry into the United States, the U.S. or foreign company that employs a transferee from Canada or Mexico must file a petition with the U.S. Immigration and Naturalization Service on his/her behalf in order to obtain Temporary Worker status. A petition for an intra-company transferee from Canada may be filed in advance or at the port-of-entry, and he/she is not required to obtain a non-immigrant (L-1) visa. A petition for an intra-company transferee from Mexico must be filed in advance, and he/she must also obtain a non-immigrant (L-1) visa.

Professionals

Citizens from one NAFTA country who will be rendering professional-level services for an entity in another NAFTA country may qualify for temporary entry as a NAFTA professional. Only certain professions qualify for entry as NAFTA professionals. These are listed in Appendix 1603.D.1. NAFTA professionals must meet the minimum education requirements set out in the Appendix and must comply with any applicable licensing requirements to engage in a particular profession. The minimum education requirement for the profession is in most cases a Bachelors Degree or its equivalent, and the degree must be a prerequisite for employment in the position offered. The NAFTA temporary entry provisions do not authorize a professional to establish a business or practice in another NAFTA country in which he/she will be self-employed. This does not preclude self-employed professionals from seeking temporary entry under NAFTA to provide pre-arranged professional services for another entity.

NAFTA professionals must demonstrate to the country that they wish to enter that they do not intend to remain permanently. Along with a letter from his/her prospective employer offering a job that conforms to the NAFTA list of professions, an applicant will be required to submit information and supporting documentation concerning his/her educational background and credentials, remuneration arrangements and length of stay. NAFTA professionals are granted temporary entry for a period of one year, which is renewable in single year increments.

For temporary entry into Canada, a professional from the United States or Mexico must apply for Employment Authorization at a Canadian embassy or consulate, or at a port-of-entry.

For temporary entry into Mexico, a professional from Canada or the United States must obtain a business visa from a Mexican embassy or consulate, or in Mexico. The visa is valid for multiple entries for one year and can be renewed for four additional years, when a new visa may be obtained.

For temporary entry into the United States, a professional from Canada must present proper documentation at the port-of-entry describing the professional-level activity that the person will be performing as well as evidence that the person meets the educational qualifications and evidence that he/she meets licensing requirements, if any. For a professional from Mexico, the U.S. employer is currently required to file a labor condition application with the U.S. Department of Labor, and the employer must obtain a NAFTA professional (TN) visa from a consular office. In 2004, the requirements for a labor certification and INS classification will be eliminated.

There is no limit on the number of Canadian professionals who can be admitted to the United States under Chapter Sixteen. For Mexicans, a limit was set at 5,500 initial approvals per year for a transition period of ten years (until 2004).

Can the U.S. Government help me if I have a problem?

Yes. If you believe, in the course of conducting business with Canada or Mexico, that the Canadian or Mexican government has failed to comply with the provisions of Chapter Sixteen of the NAFTA regarding temporary entry of business persons, contact the Office of Trade Agreements Negotiations and Compliance's hotline at the U.S. Department of Commerce. The Center can help you understand your rights under Chapter Sixteen and can alert the relevant U.S. Government officials to help you resolve your problem. The U.S. Government can, if appropriate, raise the particular facts of your situation with Canadian or Mexican authorities and ask them to review the matter. However, you should be aware that the dispute settlement provisions of the NAFTA are not available for particular cases unless the matter involves a pattern of practice and the business person has exhausted the available administrative remedies.

How can I get more information?

The complete text of Chapter Sixteen (Temporary Entry of Business Persons) of the NAFTA is available on the Office of Trade Agreements Negotiations and Compliance's web site.

If you have questions about Chapter Sixteen or how to use it, you can e-mail the Office of Trade Agreements Negotiations and Compliance, which will forward your message to the Commerce Department's Designated Monitoring Officer for this NAFTA Chapter. You can also contact the Designated Monitoring Officer at the following address:

Designated Monitoring Officer -

NAFTA Chapter 16 (Temporary Entry)

Office of North America

U.S. Department of Commerce

14th Street & Constitution Avenue, N.W.

Washington, D.C. 20230

Phone: (202) 482 - 1547

Fax: (202) 482 - 5865

Other useful information is available on the following web sites:

The NAFTA Web Site of the Office of NAFTA and Inter-American Affairs at the U.S. Department of Commerce contains additional details on temporary entry of business persons under the NAFTA as well as other documents and background information on the NAFTA and on doing business in Canada and Mexico.

The web site of the U.S. Citizenship and Immigration Services contains detailed information on the laws and regulations relating to entry into the United States.