USMCA Agreement
The USMCA Agreement, effective October 2018, establishes new trade regulations between Canada, Mexico, and the United States, focusing on automotive, agricultural, and pharmaceutical sectors. This agreement aims to enhance market access and protect intellectual property while improving labor and environmental standards.
- Seventy-five percent of auto parts must be produced in North America to qualify for zero tariffs. Workers producing 40-45% of car parts must earn at least $16 per hour.
- Canada will provide greater market access for US dairy, poultry, and eggs, while the US will allow more Canadian dairy and sugar products.
- The agreement includes stronger patent protections and penalties for piracy, along with a process for addressing anti-dumping policies among the three nations.
The USMCA Agreement, effective from October 2018, is a trade pact between Canada, Mexico, and the United States. It aims to enhance trade relations and economic cooperation among the three countries, replacing the previous NAFTA agreement and introducing new provisions to benefit various sectors.
As of the beginning of October 2018, there is a new trade agreement between Canada, Mexico and the United States, which is called the USMCA Agreement (United States Mexico Canada). Highlighted below are some of the results of the agreement:
- Automotive Changes:
- 75% of auto parts must be made in North America, over time, to qualify for zero tariffs (Canada, Mexico, USA).
- 40-45% of car and truck parts must be made by workers earning at least $16 per hour.
- Agriculture:
- Canada will increase market access for US dairy, poultry, and eggs due to eliminating price increase policies on US dairy products.
- USA will allow more Canada dairy, peanuts and peanut products, and some sugar into their country.
- Pharmaceutical/Biotech: Stronger protections for patents and trademarks for 10 years before facing generic competition.
- Books/Software/Video: Added penalties are outlined for pirated movies while prohibiting duties on books, software, and video games.
- Other:
- Improved labor and environmental rights are included.
- A process remains in place to challenge each other’s anti-dumping policies and countervailing duties via a trilateral council.
- The three nations will review the agreement in 6 years.
These changes will be instituted at different times over the next few years. Gallagher Transport has over 25 years of importing and exporting experience and remain committed to staying ahead of changes that affect your business and your bottom line. Please let us know if we can assist with any trade needs for you or your business.
Call 303‑365‑1000 or email us anytime.