The U.S. had no legal standing to impose safeguard tariffs on Canadian solar panels, a USMCA panel ruled in January. The panel report was made public on Feb. 15.
The U.S. is seeking formal consultations over how Mexico is enforcing laws aimed at protecting the endangered vaquita porpoise and the prohibition on the sale of the totoaba fish, after other discussions did not produce enough progress, officials from the Office of the U.S. Trade Representative said. These consultations are under the environmental chapter of the USMCA, not the dispute settlement chapter, but if the countries were not able to reach a negotiated settlement, the U.S. could table a dispute that could ultimately lead to tariffs, if the panel ruled against Mexico.
The Office of the U.S. Trade Representative is inviting submissions on how USMCA is working in the automotive goods arena, "including the implementation and enforcement of the USMCA rules of origin for automotive goods" and whether the accord's automotive provisions "are relevant in light of technological and production advances." Comments can be submitted through March 28 in docket number USTR-2022-0001.
The tariff on most imported solar panels will drop to 14.75% at 12:01 a.m. on Feb. 7, and bifacial solar panels will continue to be exempt from the global safeguard, a presidential proclamation Feb. 4 says. The tariff rate quota threshold for solar cells will also double from 2.5 GW to 5 GW, making it unlikely any imported cells will be subject to the tariff.
The rapid response mechanism of USMCA overturned the initial union election at the General Motors pickup truck plant in Silao, Mexico, and despite Democrats' concern that the election would also be marred by intimidation (see 2201280018), workers overwhelmingly chose an independent union. The AFL-CIO issued a statement that said: "Together, in a democratic union, workers will advocate for higher wages and improved health and safety standards at the Silao facility, helping to set new standards in the automobile industry. The election itself set a hard-won precedent and came only after workers voted to throw out a previous contract that had poor benefits and was negotiated without the workers’ input. Workers overcame gross intimidation and election meddling, and their triumph is an example of what happens when workers stand together. This vote represents a rejection of the past and a new era for Mexican workers’ right to associate freely."
House Ways and Means Trade Subcommittee Chairman Rep. Earl Blumenauer, D-Ore., said he and colleagues Reps. Dan Kildee, D-Mich., and Bill Pascrell, D-N.J., "are alarmed by reports of continued harassment, intimidation, and violence against independent union activists in the General Motors’ (GM) auto plant in Silao, Mexico leading up to next week’s union election." The congressmen noted that a previous vote in Silao was overturned through consultations under USMCA's rapid response mechanism, and they say that unless GM and Mexican officials immediately act, the agreement to rerun the election could be pointless.
All 14 of the Republicans on the Senate Finance Committee are telling colleagues in their chamber that providing a $12,500 incentive to purchase union-made, U.S.-assembled electric vehicles will spur foreign retaliation against American auto exports. The House version of Build Back Better offers a $7,500 refundable tax credit for any electric vehicle purchase -- the same amount as current law, but makes it refundable and does not phase it out for leading manufacturers. Currently, Tesla and General Motors vehicles are no longer eligible for the credits. But in order to receive $12,500, the car or truck would need to include a U.S.-assembled battery and be made by union workers in the United States.
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A dispute panel that will consider whether the U.S. interpretation of auto rules of origin is too stringent will have Mexico and Canada on the too-strict side of the argument and the U.S. defending itself alone.
After the first USMCA deputies meeting, Mexico, Canada and the U.S. issued a joint statement saying that they are scrutinizing the implementation of the prohibition on importing goods made with forced labor. They also discussed environmental law enforcement cooperation, and training planned this year for small businesses so they can access the treaty's benefits. All said "though there have been challenges, progress continues to be made under the Agreement."