The U.S. Trade Representative announced the appointment of USMCA state-to-state dispute panelists July 1:
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.
Drawback filers should not file any USMCA drawback claims at this time, CBP said in a CSMS message. Some technical changes to ACE need to be made before CBP can accept USMCA claims, and the agency will send out another CSMS message when they have been deployed. “Please continue to file NAFTA drawback claims, if applicable, under the NAFTA requirements,” CBP said. Filers will not be allowed to commingle NAFTA and USMCA imports on the same drawback claim. “The date of entry determines which agreement controls, not the date of claim,” it said.
The U.S. named six panelists for the Rapid Response Labor Mechanism, for the enforcement of USMCA labor protections:
CBP issued its final USMCA implementing instructions late June 30, it said in a CSMS message issued late that day. “These USMCA Implementing Instructions replace the Updated USMCA Interim Implementing Instructions issued on June 16, 2020, and provide guidance on the new requirements under the USMCA, including information on USMCA entry, compliance, rules-of-origin, origin certifications, new auto requirements, textile requirements, and other requirements for claiming USMCA preferential treatment for goods,” CBP said. “Effective July 1, 2020, the North American Free Trade Agreement (NAFTA) terminates and the USMCA enters into force.”
CBP is issuing an interim final rule to implement rules of origin provisions for the U.S.-Mexico-Canada Agreement that will take effect July 1. The interim rule creates new Part 182 to the customs regulations for USMCA, and amends existing NAFTA regulations under 19 CFR Part 181 so that they no longer apply to entries on or after July 1. Most of 19 CFR Part 182 is vacant, but CBP says it will fill out the regulations over the coming year. Comments on the interim regulations are due Aug. 31.
International Trade Today is providing readers with some of the top stories for June 22-26 in case they were missed.
Senate Finance Committee Chairman Chuck Grassley, R-Iowa, celebrated the switchover from NAFTA to the U.S.-Mexico-Canada Agreement -- coming July 1 -- but also talked about a trade irritant with Canada and one with Mexico in a conference call with reporters June 30.
CBP is issuing a notice amending its National Customs Automation Program reconciliation test to provide for the filing of post-importation claims under 19 USC 1520(d) -- also known as 520(d) claims -- for U.S.-Canada-Mexico Agreement treatment beginning on July 1. As with 520(d) claims for NAFTA and other free trade agreements, importers of entries flagged for USMCA must file their reconciliation entries within 12 months of the earliest import date for the flag. Post-importation refunds of merchandise processing fees (MPF) are not currently allowed under USMCA, but CBP says importers may “wish to flag USMCA entries for the possibility of MPF refunds for a post-importation USMCA claim, as CBP will provide for refunds consistent with any legislative changes.” For goods entered prior to July 1, the date when USMCA takes effect, importers may continue to submit post-importation NAFTA claims. “Since importers may file post-importation claims at any time within one year after the date of importation, no post-importation claims for NAFTA preference will be accepted after June 30, 2021,” CBP said.
CBP created Harmonized System Update (HSU) 2005 June 29, containing 124,980 Automated Broker Interface records and 24,925 Harmonized Tariff Schedule records, it said in a CSMS message. The update includes changes necessary to implement the U.S.-Mexico-Canada Agreement and to support the automation of softwood lumber assessments. The update also covers modifications mandated by the 484 F Committee (the Committee for Statistical Annotation of Tariff Schedules) and recent Section 301 tariff exclusions. Further information: Jennifer Keeling, Jennifer.L.Keeling@cbp.dhs.gov.
The Office of the U.S. Trade Representative is establishing a new tariff-rate quota for imports of sugar-containing products from Canada under the U.S.-Mexico-Canada Agreement, it said in a notice. Effective July 1, the TRQ will allow imports at an in-quota rate of up to 9,600 metric tons of sugar-containing products, as defined in Annex 2-B to USMCA. USTR will require export certificates issued by the Canadian government for goods entered under the TRQ. “No SCP that is the product of Canada will be permitted entry under the in-quota tariff rate established for imports of SCPs from Canada, unless at the time of entry the person entering the SCP makes a declaration to [CBP], in the form and manner prescribed by CBP, that a valid export certificate is in effect for the SCP,” USTR said in the notice. The certificate requirement will remain in effect going forward unless USTR issues a determination that export certificates will not be required in any given year.