International Trade Today is providing readers with some of the top stories for March 30 - April 3 in case they were missed.
USMCA
The U.S.-Mexico-Canada agreement is a free trade agreement between the three countries, also known as CUSMA in Canada and T-MEC in Mexico. Replacing the North American Free Trade Agreement (NAFTA) in 2020, the agreement contains a unique sunset provision where, after six years (in 2026), any of the three parties may decide not to continue the agreement in its current form and begin a period of up to 10 years where USMCA provisions may be renegotiated.
The Canadian government has sent its letter to the U.S. and Mexico certifying it is ready for the USMCA date of entry into force, Deputy Prime Minister Chrystia Freeland announced April 3, but a top Mexican official said his country did not certify it was ready by March 31, which means a June 1 date of entry into force is out of reach.
Nineteen of the 28 senators on the Finance Committee -- including Chairman Chuck Grassley, R-Iowa, and top Democrat Ron Wyden of Oregon -- told U.S. Trade Representative Robert Lighthizer that having the U.S.-Mexico-Canada Agreement start on June 1 is too soon.
The Commercial Customs Operations Advisory Committee (COAC) for CBP will next meet April 15, remotely, beginning at 1 p.m., CBP said in a notice. Comments are due in writing by April 14.
Canadian and Mexican politicians are sending different messages to their countries' journalists about how quickly the uniform regulations can be completed for the new NAFTA, now known as the U.S.-Mexico-Canada Agreement. A Canadian politician and a labor leader told a Canadian newspaper that a June 1 date of entry into force is unlikely, given how much remains to be done to be ready, and especially with the disruption caused by the coronavirus COVID-19 pandemic.
CBP should look at “extending the liquidation of all unliquidated entries by 90 or 180 days,” the Business Alliance for Customs Modernization told the agency in a March 23 letter. Those extensions “would help ensure that importers who may be eligible for duty refunds (e.g., based on Section 232 or Section 301 product exclusion approvals) do not miss opportunities to pursue such refunds administratively due to staffing issues caused by COVID-19.” BACM offered its support for deferring collections of customs duties and asked “that payments related to past liabilities, such as denied protests, also be temporarily deferred.” BACM suggested several other items it said “would help ease the burden on the trade community during this time.”
The American Association of Exporters and Importers is asking the Trump administration to help importers and exporters deal with the impact of COVID-19 response measures, whether that impact is a cash crunch, the effects of telework or business decisions made in response to delays in shipments from China. The group is asking the administration to extend the time to respond to regulatory notices that are paper based, including entry filings deadlines, because telecommuting makes it more difficult to manage the paper flow. It is also asking CBP to extend the protest period for customs duties and decisions.
The language of the U.S.-Mexico-Canada Agreement says that in order for the treaty to take effect on June 1 -- as U.S. officials have told Congress they want -- the countries would have to agree that they're ready 12 days from now. Kenneth Smith Ramos, a former top negotiator of the NAFTA rewrite, said the three countries cannot say they've completed their internal procedures by then. “#NotHappening,” he wrote in English at the end of a tweet in Spanish.
Claims that NAFTA was ripped up or that it was just a rebranding are wrong and paying attention to the changes could mean big savings for businesses, said Dickinson Wright Cross-Border Practice Chair Dan Ujczo during a March 17 Global Chamber webinar. Ujczo said that one polymer and chemicals company he talked to saw that changes from NAFTA to the U.S.-Mexico-Canada Agreement “are going to save us $17 million.” He urged businesses that use NAFTA to convene their purchasing, accounting and either in-house customs teams or customs brokers to investigate their supply chains, because he predicted that CBP will pay closer attention to rules of origin, and he said many companies are relying on slapdash rules of origin certificates from suppliers (see 2002190028).
Applications to become a panelist on a state-to-state dispute settlement panel for the U.S.-Mexico-Canada Agreement, or on a specialized labor panel, will be due by April 20, the Office of the U.S. Trade Representative said in a notice.