Commonly dubbed NAFTA 2.0, Canada's new trade agreement with the United States and Mexico, the United States-Mexico-Canada Agreement, U.S.MCA, was signed literally hours before the deadline on September 30, 2018. Expected to be ratified by each country by late November, initially little was know about the agreement. During the past few weeks, details have continued to emerge on the trade agreement. Here are some highlights of U.S.MCA as they pertain to cross-border business.
Highlights of U.S.MCA
Note: Points 1 - 3 most significantly impact immigration law.
- TNs (Trade National visas) covered under NAFTA Chapter 16, which let Canadian businesses hire skilled American and Mexican workers in more than 60 professional categories on temporary work permits, were not significantly changed.
The list of 66 professions under the agreement wasn’t updated in the U.S.MCA. It has not been updated since 1994. This list includes occupations like doctor, lawyer, scientist, accountant, economist, and teacher, but it does not include any professions in today’s software and technology industries, which have made up the majority of emerging markets over the last ten years.
- Improved working conditions throughout North America, and a "level playing field for Canadian workers and businesses by committing U.S.MCA Parties to high labour standards, including with respect to minimum wages, and preventing them waiving their domestic labour laws in order to encourage trade or investment."
- Canada can pursue trade agreements with China after notifying their trading partners if they engage in trade talks with any "non-market economies."
- The extension of copyright protection in Canada from 50 to 70 years in line with the U.S. and European Union.
- Increase the threshold for online order duty and taxes for Canadian businesses from CAD$20 to CAD$40, which is good for online businesses but not for brick and mortar stores.
- Increase protection for new “biologic” drug products to 10 years, which is expected to increase the cost and availability of generic drugs.
- The pact includes a guarantee against U.S.-imposed tariffs in the automotive sector.
U.S.MCA proposes a 16-year agreement, renewable following a six-year review.