As published by the Canadian Society of Customs Brokers:
We have prepared hightlights of the new NAFTA Agreement for our members, as follows:
- The new agreement is named the United States-Mexico-Canada Agreement (USMCA);
- To qualify for preferential treatment, automobiles will require 75% North American content, up from the existing 62.5% (by 2020, in all countries);
- At least 30% of the workers producing a vehicle must earn $16.00 USD per hour (by 2020); by 2023, this raises incrementally to 40% (in all countries);
- The US is introducing a quota system to protect Mexico and Canada from any future tariffs applied to vehicles and parts. Each country has a “side letter agreement”;
- Canadian supply management continues to exist but US dairy producers will have greater market access in Canada;
- Chapter 11 is gone; Chapter 19 (now Chapter 31) remains for dispute settlements;
- US steel tariffs remain in place;
- Chapter 7 introduces new de minimis levels for all three countries: US and Mexico, at least $100 USD; Canada, at least C$150 for customs duties and C$40 for taxes.
It is important to note that the new agreement has been made in principle and must be ratified by the three countries' legislative bodies and processes. The text of the new agreement is available on the USTR website.
We will continue to review the full terms of the texts and provide updates as they become available.