USMCA will go into force on July 1, per U.S. trade rep

April 27, 2020

Tyson Fisher

|

Despite calls from several Congress members to delay the United States-Mexico-Canada Agreement, the U.S. trade representative said USMCA will be implemented as scheduled.

On Friday, April 24, U.S. Trade Representative Robert Lighthizer broke his silence regarding the implementation of USMCA. In a statement, Lighthizer said that USMCA will enter into force July 1.

Lighthizer notified Congress on April 24 that Canada and Mexico have done their parts in ensuring compliance with their respective commitments. Following that notification, the United States became the third country to notify the other two countries that it has completed its domestic procedures to implement the agreement, according to a USTR statement. Accordingly, this completed all steps required to launch enforcement of USMCA.

However, many in Congress believe that July is too soon to implement USMCA. In a letter dated March 30, 19 members of the Senate Finance Committee urged Lighthizer to delay the launch date. The letter states that COVID-19’s global disruption has left little time and resources to prepare for a smooth transition.

During a press briefing on April 9, President Donald Trump signaled that he will continue with USMCA as signed.

“Obviously the deal is different from the standpoint that production will be lower, but we have a deal,” Trump said. “It’s a signed deal.”

Subsequently, 31 members of the U.S. House of Representatives sent a letter to Lighthizer requesting flexibility of USMCA’s rules of origin requirements for automotive manufacturers.

“This targeted extension is necessary to allow the auto industry an appropriate adjustment period and account for delays caused by the COVID-19 pandemic,” the letter stated. “Alternatively, we ask that you seriously consider other accommodations or flexibilities that will allow the automotive sector to avoid being penalized by the new requirements upon the agreement’s entry into force.”

Contrary to those concerns, Lighthizer suggested that the current pandemic is a good reason to keep USMCA on schedule.

“The crisis and recovery from the COVID-19 pandemic demonstrates that now, more than ever, the United States should strive to increase manufacturing capacity and investment in North America,” Lighthizer said in a statement. “The USMCA’s entry into force is a landmark achievement in that effort.  Under President Trump’s leadership, USTR will continue working to ensure a smooth implementation of the USMCA so that American workers and businesses can enjoy the benefits of the new agreement.”

Related stories: