(Washington, D.C.) -- The U.S.-Mexico-Canada Trade Agreement took a step forward in the Senate with the Finance Committee passing it on.
Dan Ujczo is an International Trade and Customs Lawyer with Dickinson Wight in Columbus, Ohio. He says the fact that it moved out of the Senate Finance Committee is good news but it’s still hard to know when it will finally come up for a vote in the Senate.
“Several other committees, environment, labor, and a few others have said ‘hold on a second, we get our say too.’ We don’t expect any problems, but I think that’s adding a little bit more time, and then what will likely happen is impeachment comes into play here. So, as Speaker Pelosi puts forward the impeachment articles, USMCA will get pushed until after that, so I think we’re still looking at late January, maybe even early February, in the U.S. Senate.”
He expects all three countries to have finally ratified USMCA by late February or early May. There’s a three-month wait for it to go into effect after all three countries have officially approved the agreement, which likely puts it into effect around May 1.
In order to fully implement the agreement, the three countries have to iron out the uniform regulations that govern trade between the nations.
“Since about 60 percent of the original NAFTA has made its way into the USMCA, we don’t have to start from scratch. We’ll keep using those uniform regulations. But, for all of these provisions that have changed, and that’s 40-45 percent of the agreement, that process is underway as we speak. And, there’s a lot of work to do there, particularly in areas like autos. There are some issues on agriculture.”
There aren’t a lot of changes needed to the uniform regulations that govern agricultural trade.
“Certainly, tariffs aren’t moving, so that should be good news for everybody in the agricultural community. If you’re using NAFTA now and you have zero tariffs, you’re going to have zero tariffs going forward. There are some changes on sanitary-phytosanitary, so some of the inspection-type issues. There’s also some changes on customs, the type of paperwork you need to move the product across borders.”
Ujczo says it’s just a matter of when, not if USMCA will get passed and put into effect.
“I think one thing you can bank on right now is that USMCA will be ratified by the three countries sometime this winter and by the spring, it’s going to be coming into force, so that’s one thing you can take to the bank.”