On January 29, 2020, the President signed legislation implementing the United States–Mexico–Canada Agreement (USMCA). The USMCA entered into force July 1, 2020, modernizing and replacing the North American Free Trade Agreement (NAFTA).
USMCA’s monitoring and enforcement provisions improve on NAFTA’s dispute settlement mechanisms. The United States, Mexico, and Canada have agreed to close the loopholes in the NAFTA that allowed parties to block the formation of panels. In addition, the USMCA’s labor and environment provisions are fully incorporated into the main text of the agreement and subject to an updated dispute settlement mechanism.
USTR is committed to enforcing the modernized, high-standards rules of USMCA. In 2020, the United States pursued its first action under USMCA Chapter 31 (Dispute Settlement). In December 2020, the United States requested consultations with Canada regarding Canada’s administration of 14 of its dairy tariff-rate quotas (TRQs).
The Dispute Settlement chapter establishes a first-of-its-kind United States-Mexico Rapid Response Labor Mechanism, providing for monitoring and expedited enforcement of labor rights to ensure effective implementation of Mexico’s landmark labor reform at particular facilities while respecting sovereignty and due process.
Further, USMCA Chapter 10 provides review and dispute settlement procedures in antidumping and countervailing duty matters.
Additional information on USMCA is available here.
