USMCA

Date: October 17, 2019

Background:

In August 2017, the United States began negotiations with Canada and Mexico to update and replace the current North American Free Trade Agreement (NAFTA). The parties conducted several negotiating rounds that culminated in a draft agreement just over a year later in October 2018.

On November 30, 2018, the final text of the United States-Mexico-Canada Agreement (USMCA) was signed by President Donald Trump, President Enrique Peña Nieto and Prime Minister Justin Trudeau.

Status:

The most significant changes under the USMCA were related to the automotive specific rules of origin (ROO) that overhauled the regional value content (RVC) requirements, created a matrix of parts categories, vehicle applications, and increased the RVC values. The new ROO also includes two new compliance requirements for vehicle producers – steel and aluminum requirements and labor value content requirement – both of which have market implications for vehicle suppliers.

  • May 2, 2019 – MEMA issued a statement urging the Congress to pass the USMCA:

    “MEMA supports and urges the U.S. Congress to pass without delay. The USMCA will provide economic certainty and opportunity for manufacturing growth in the United States and throughout the region. This economic certainty is essential for U.S. suppliers to advance the safety and fuel efficiency technologies required to be competitive in the global mobility marketplace.”

  • May 16, 2019 – President Trump issues a proclamation lifting Sec. 232 Steel and Aluminum Tariffs for imported steel and aluminum from Canada and Mexico

  • May 29, 2019 – Canada introduced legislation in its Parliament, but was not acted upon before the body adjourned for the summer

  • May 30, 2019 – Trump Administration sent a Draft Statement of Administrative Action to the Congress, which is required as part of the Trade Promotion Authority process

  • June 19, 2019 – Mexican Senate approves legislation ratifying USMCA in a special session

During the Summer of 2019, USTR Robert Lighthizer and Deputy USTR C.J. Mahoney led efforts to conduct regular engagement with Capitol Hill in preparation for USMCA legislation. The U.S. House of Representatives Speaker Nancy Pelosi formed a USMCA Working Group made up of eight Democrats to interface with the Administration on key issues important to them, specifically labor, environment, drugs, and enforcement.

  • Sept. 11, 2019 – MEMA hosted a “Pass USMCA!” Fly-In event for member companies; over 40 meetings were held with key congressional offices urging support for the agreement

    • Visit MEMA’s Action Center here and urge your Member of Congress to support USMCA

    • Also, follow @MEMADC on Twitter and re-tweet and like our trade policy messages

MEMA Staff Contacts:

Ann Wilson and Leigh Merino
 

USMCA-Resources:

 

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