March 17, 2020

USMCA Bill Passed by Canadians – USTR Notifies Congress that USMCA will go into effect June 1st  (From Wendt & Temples)

The Canadian House of Commons and Senate approved USMCA enabling legislation on Friday, and royal assent was given shortly thereafter, starting the 90-day period wherein the parties must draft uniform regulations to govern the agreement, including those addressing how automobiles and automotive products will qualify for reduced tariffs. The parties must notify each other when this process is completed in each country in an exchange of letters. The agreement is to go into effect on the first day of the third month following the last such notification. USTR Lighthizer notified Congress of the June 1st date before the parties have met any of these obligations, so some feel this date is ambitious, especially considering the communications and work challenges the countries face from the Coronavirus. The automotive industry has expressed concern that there are no draft uniform automotive rules of origin regulations, and that they should be in place before the agreement goes into effect. Others are concerned about Mexico’s ability to implement any of the many changes to its labor laws contained in the Labor Chapter provisions in this time frame when so much government effort is directed at controlling the virus.

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