What is 'North American Free Trade Agreement' in SAP SD - Sales and Distribution?

North American Free Trade Agreement - Overview

• Component: SD

• Component Name: Sales and Distribution

• Description: A trade treaty between the USA, Mexico, and Canada. This agreement allows special tariff treatment lower or free duty when exchanging commodities between these countries. The agreement eliminates tariffs and other trade barriers on approximately 10,000 goods over a period of 15 years beginning in 1994.

North American Free Trade Agreement - Details

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  Key Concepts: 
  The North American Free Trade Agreement (NAFTA) is a trade agreement between the United States, Canada, and Mexico that eliminates tariffs and other trade barriers between the three countries. It was signed in 1994 and has been in effect since January 1, 1994. In the context of SAP Sales and Distribution (SD), NAFTA is used to determine the applicable taxes and duties for goods traded between the three countries. 
  
  How to use it: 
  In SAP SD, NAFTA is used to determine the applicable taxes and duties for goods traded between the three countries. The system will automatically calculate the applicable taxes and duties based on the country of origin of the goods. The system will also check if any special rules or exemptions apply to the goods being traded. 
  
  Tips & Tricks: 
  When setting up a sales order in SAP SD, it is important to ensure that all relevant information regarding NAFTA is included in the order. This includes the country of origin of the goods, any special rules or exemptions that may apply, and any applicable taxes or duties. 
  
  Related Information: 
  For more information on NAFTA and its implications for SAP SD, please refer to SAP Help documentation or contact your local SAP representative.