The source for trade compliance news

CBP's Smith Sees Opportunities, 'Heavy Lift' Ahead for Implementation of USMCA Changes From NAFTA

Outside the most complicated issues to be implemented as part of the U.S.-Mexico-Canada Agreement, such as rules of origin, CBP also sees new “opportunities that are touched on in the agreement,” said Brenda Smith, executive assistant commissioner of CBP’s Office of Trade, during a Jan. 29 interview. “For example, there's some guidance around establishing single windows, there are opportunities for us to validate through site visits compliance with all customs laws and that's a much broader scope than it was before,” she said. President Donald Trump signed the implementing bill into law the same day, though Canada still must give its final approval, and implementing actions must be completed by all countries before USMCA can take effect.

There also are provisions in USMCA on forced labor that were not in NAFTA, including both a “pretty significant add that's directed at coordination within the U.S. government” and “language around expectations for Canada and Mexico,” she said. Those “opportunities” are things that CBP will focus on once “we get past the first rush of 'This is what you have to do on day one,'” she said. After that, there will be more discussion of “how can we, through collaboration with the Canadians and Mexicans, figure out how we as customs administrations can best administer the agreement and drive 21st century customs and trade forward using those new areas.”

CBP is still working through the specifics for high profile provisions, such as labor wage content requirements and rules of origin for automobiles, she said. “The rough estimates are that 80 percent of the agreement is essentially the same, with significant change in the remaining 20 [percent], and a lot of the change is around the automotive industry, as well as -- and this has gotten a lot of profile -- the labor issues.”

While the regulatory and automation changes are not minimal, CBP has some recent experience in putting in place major changes, Smith said. “Not only have we done it for NAFTA,” but also the implementation of ACE, something that Smith was heavily involved in. “We've kind of got this machine going,” she said. Maya Kamar, who heads the Textiles and Trade Agreements Division “is our lead for this” and is “working very closely across the agency,” Smith said. There's also a strong network across the Centers of Excellence and Expertise, she said.

The “uniform regulations and the implementing regulations” will be a “pretty heavy lift,” she said. “We'll start with communication and move into education. We are having lots of interagency conversations.” In fact, Smith noted that, during the interview, she received an email from the Office of the U.S. Trade Representative asking about a congressionally mandated part of the deal that USTR was not familiar with. “Those sorts of interagency conversations are well underway,” she said.