International Trade Today is providing readers with some of the top stories from Aug. 24-28 in case they were missed. All articles can be found by searching on the titles or by clicking on the hyperlinked reference number.
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.
Daimler Trucks North America is raising alarms on changes to the steel and aluminum purchases requirement, the ability to use accumulation for regional value content with non-originating parts, and the treatment of returned goods within the USMCA. The company also identified ambiguities with the labor value content rule, and errors and omissions in tariff classifications in Note 11 that cause problems for compliance.
Twenty-three senators from both political parties urged U.S. Trade Representative Robert Lighthizer and Agriculture Secretary Sonny Perdue to press Canada to uphold its promises to give U.S. dairy exporters more market access. In a letter, released by Sen. Tina Smith, D-Minn., Aug. 26, they said that they agree with concerns about enforcement of USMCA dairy provisions expressed in a July letter sent by House members (see 2007020040), and that they are concerned that Canada's plans to fill its quotas are not consistent with those provisions. “Canada must not be permitted to effectively recreate the harmful impacts of Canada’s highly trade-distortive Classes 6 and 7 milk pricing programs,” the Aug. 25 letter said. “Canada must ... clearly establish prices for any new classes based on the end use of dairy products, and ensure that export surcharges for certain dairy products are implemented properly.”
International Trade Today is providing readers with some of the top stories from Aug. 17-21 in case they were missed. All articles can be found by searching on the titles or by clicking on the hyperlinked reference number.
The Customs Rulings Online Search System (CROSS) was updated Aug. 24. The following headquarters rulings were modified recently, according to CBP:
More companies are seeking drawback payments as the economic slowdown has increased the importance of cash on hand, CBP officials and industry executives said during the American Association of Exporters and Importers virtual conference Aug. 20. “In general, I would say COVID's had a major impact on our businesses and it's also made our company even more focused on getting cash in the door,” said Kathleen Palma, senior executive for international trade compliance at GE. “One of the levers that our leadership has been looking at has been drawback.” At the same time, Palma expects that because the company is bringing in fewer shipments, that will be reflected in fewer drawback claims going forward.
During the second of two hearings aimed at satisfying primarily Florida and Georgia farmers frustrated with lost market share to Mexican competitors, officials from the Commerce Department, the U.S. Department of Agriculture and the Office of the U.S. Trade Representative on Aug. 20 heard vastly different views of how Mexican vegetable and fruit producers deserve to be treated (see 2008180034). Blueberry, zucchini, cucumber and bell pepper farmers from Georgia testified again and again that Mexicans can sell these items cheaper than they can, because of much lower labor prices, because of stricter environmental regulations in the U.S., and because Mexican producers have gotten government help to build shade houses, greenhouses and hoop houses.
While many expect a President Joe Biden to be less protectionist than President Donald Trump, Michael Smart, a managing director at Rock Creek Global Advisors and former international trade counsel for Democrats on the Senate Finance Committee, wasn't ready to say that Biden would roll back tariffs on either China or Europe, though he did say that Biden wouldn't “go after the European Union” as Trump has. He said that a Trump or a Biden administration would have the same focus on expanding Buy American rules, which cover government procurement.
Several trade groups representing businesses would like the USMCA's rapid labor mechanism for dealing with Mexico labor violations to be far less rapid, according to their suggestions on how the process should go. The National Foreign Trade Council, the Retail Industry Leaders Association and the National Retail Federation submitted nearly identical comments to the Office of the U.S. Trade Representative, which posted them publicly late on Aug. 17. They said that those arguing that Mexicans' rights to collective bargaining and freedom of association are being abridged by an employer should “be required to exhaust all other avenues prior to filing petitions.”
International Trade Today is providing readers with some of the top stories from Aug. 10-14 in case they were missed. All articles can be found by searching on the titles or by clicking on the hyperlinked reference number.