The government is considering how quickly it can get through a legislative fix to U.S.-Mexico-Canada Agreement implementation provisions that allow for duty refunds on post-importation preference claims, but not a refund of merchandise processing fees, said Maya Kumar, director of textiles and trade agreements at CBP. She said on May 22 that CBP officials “do not think that was the intent of the law.” Kumar, who was speaking at the National Association of Foreign-Trade Zones virtual conference, said that if it's at all possible, CBP would like to see that fixed by Congress before USMCA's entry into force July 1. “We’re trying to work with [the office of the U.S. Trade Representative] as well as Congress and see how quickly they can do that,” she said.
Even as UPS officials warned traders that the date of entry into force for the U.S.-Mexico-Canada Agreement will not be postponed because of the COVID-19 pandemic responses, they said all the details needed to comply won't be ready by July 1. Penny Naas, senior vice president for international public affairs at UPS, said it's not just the auto rules of origin that are “going to be provisional” in USMCA. She said that government officials will still be working on some other areas after it goes into effect. The global shipping company is in close contact with the Office of the U.S. Trade Representative.
CBP will be “implementing new requirements in ACE for processing entries subject to the new U.S.-Mexico-Canada trilateral trade agreement (USMCA)” on July 1, the agency said in an updated ACE deployment schedule. That's the same day the USMCA takes effect. CBP also has determined it will deploy Electronic Vessel Manifest Confidentiality in ACE on May 22, and it removed “Analytical Formula for Continuous Bond Sufficiency due to change in project scope,” according to the change log.
A former AFL-CIO attorney has joined the House Ways and Means Committee trade staff to help oversee the U.S.-Mexico-Canada Agreement, Chairman Richard Neal, D-Mass., announced May 18. “Critical to the USMCA’s success is its proper implementation, particularly of its rigorous general and labor enforcement mechanisms,” he said. “I am delighted to welcome Ms. [Kelly Marie] Fay Rodríguez to the Ways and Means Committee trade staff. Her legal background and experience organizing and engaging with workers and the labor community in the United States and overseas make her a valuable complement to our existing team of talented professionals.”
The complexity of the auto rules of origin in both NAFTA and the U.S.-Mexico-Canada Agreement are the result of what one observer calls the "political preoccupation" with retaining domestic auto manufacturing. Eric Miller, president of Rideau Potomac Strategy Group, noted that in NAFTA, that resulted in the tracing list, and in USMCA, that resulted in the labor value content and higher North American value targets, including for specific parts.
International Trade Today is providing readers with some of the top stories for May 11-15 in case they were missed.
Many details needed for the uniform regulations and the final implementing instructions for the U.S.-Mexico-Canada Agreement remain under discussion, agency officials said on May 14. Many specifics have not been agreed to, either between Mexico, Canada and the U.S., between the Office of the U.S. Trade Representative and the auto industry, or between CBP and USTR. “There's still even discussions with USTR and the [auto] industry on what constitutes a core part,” Maya Kumar, director for textiles and trade agreements, told members of the trade community on a conference call.
While the U.S.-Mexico-Canada Agreement allows importers to certify goods as deserving tariff benefits -- not just producers or exporters -- KPMG warned webcast listeners that if the importer and producer aren't related parties, it could be a mistake. Andrew Doornaert told listeners on May 11, “It would be a risk if you’re just relying on the exporter’s old NAFTA certificate.”
The Democratic members of the House Ways and Means Committee have told the leaders of CBP and the Department of Homeland Security that the failure to establish the Forced Labor Enforcement Task Force by the April 28 deadline in statute is unacceptable.
CBP is using a new center focused on implementation of the U.S.-Mexico-Canada Agreement to help with the process, the agency said in a May 11 news release. “Staffed with CBP experts from operational, legal, and audit disciplines, as well as with virtual representatives from Canadian and Mexican customs authorities, the USMCA Center is a cornerstone of CBP’s USMCA implementation plan and will serve as a central communication hub for CBP and the private sector community, including traders, brokers, freight forwarders and producers, ensuring a smooth and efficient transition from the North American Free Trade Agreement to USMCA,” it said.