Trade Compliance

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U.S. Government Seeking Public Input on NAFTA Renegotiation

Posted May 31, 2017


Earlier this month, the Trump administration formally notified Congress of its intent to renegotiate the North American Free Trade Agreement. In accordance with provisions of the trade promotion authority granted in 2015 (aka Trade Priorities and Accountability Act), the notification kicks off a 90-day consultation period with lawmakers and sets in motion the process of entering into discussions with Canada and Mexico later this summer.

Observing that NAFTA was negotiated 25 years ago, the notice states that “while our economy and businesses have considerably over that period, NAFTA has not.”

Many chapters are outdated and do not reflect modern standards. For example, digital trade was in its infancy when NAFTA was enacted. In addition, and consistent with the negotiating objectives in the Trade Priorities and Accountability Act, our aim is that NAFTA be modernized to include new provisions to address intellectual property rights, regulatory practices, state-owned enterprises, services, customs procedures, sanitary and phytosanitary measures, labor, environmental, and small and medium enterprises. Moreover, establishing effective implementation and aggressive enforcement of the commitments made by our trading partners under our trade agreements is vital to the success of those agreements and should be improved in the context of NAFTA.

As part of the 90-day consultation process, the U.S. Trade Representative recently published a Federal Register Notice soliciting public input on the renegotiation. In this regard, the administration is seeking comments on a total of seventeen topics including general and product-specific negotiating objectives, as well as comments on specific provisions that will help inform the direction, focus, and content of the NAFTA talks. The topics on which the administration is seeking input are as follows:

(a) General and product-specific negotiating objectives for Canada and Mexico in the context of a NAFTA modernization.

(b) Economic costs and benefits to U.S. producers and consumers of removal of any remaining tariffs and removal or reduction of non-tariff barriers on articles traded with Canada and Mexico.

(c) Treatment of specific goods (described by HTSUS numbers), including comments on:  1) Product-specific import or export interests or barriers; 2) Experience with particular measures that should be addressed in negotiations; and 3) Addressing any remaining tariffs on articles traded with Canada, including ways to address export priorities and import sensitivities related to Canada and Mexico in the context of the NAFTA.

(d) Customs and trade facilitation issues that should be addressed in the negotiations.

(e) Appropriate modifications to rules of origin or origin procedures for NAFTA qualifying goods.

(f) Any unwarranted sanitary and phytosanitary measures and technical barriers to trade imposed by Canada and Mexico that should be addressed in the negotiations.

(g) Relevant barriers to trade in services between the United States and Canada and Mexico that should be addressed in the negotiations.

(h) Relevant digital trade issues that should be addressed in the negotiations.

(i) Relevant trade-related intellectual property rights issues that should be addressed in the negotiations.

(j) Relevant investment issues that should be addressed in the negotiations.

(k) Relevant competition-related matters that should be addressed in the negotiations.

(l) Relevant government procurement issues that should be addressed in the negotiations.

(m) Relevant environmental issues that should be addressed in the negotiations.

(n) Relevant labor issues that should be addressed in the negotiations.

(o) Issues of particular relevance to small and medium-sized businesses that should be addressed in the negotiations.

(p) Relevant trade remedy issues that should be addressed in the negotiations.

(q) Relevant state-owned enterprise issues that should be addressed in the negotiations.

Written comments must be submitted to the Office of the U.S. Trade Representative no later than Monday, June 12, 2017 (click here for more detailed information and submission instructions).

Following the comment period, a public hearing will be held at the U.S. International Trade Commission.