The USMCA Agreement: What Comes Next?
The USMCA (United States-Mexico-Canada Agreement) has officially been signed into law by all three countries involved. But what happens next?
First, the agreement will enter its implementation period, which will take place over the next few months. During this time, each country will work to put the necessary measures in place to fully comply with the terms of the agreement. For example, Canada will need to change certain laws related to intellectual property and labor, while Mexico will need to establish a new labor court system.
Once the implementation period is complete, the agreement can be fully enacted. However, there are a few other steps that need to be taken before that can happen.
First, each country’s legislative body needs to approve the agreement. In the United States, this means that the USMCA will need to be ratified by Congress. This process is already underway, but it could take some time to complete.
Once Congress has ratified the agreement, it will take effect on the first day of the third month following ratification. This means that if Congress ratifies the USMCA in January, it would take effect on April 1.
It’s worth noting that the USMCA includes a sunset clause, which means that the agreement will expire after 16 years unless all three countries agree to extend it. This is a significant departure from the NAFTA (North American Free Trade Agreement), which had no such provision. There is also a review clause built into the USMCA that allows the three countries to assess the impacts of the agreement every six years.
In general, the USMCA is seen as an improvement over NAFTA, particularly in the areas of labor and environmental protections. However, it remains to be seen how effective the new agreement will be in practice.
If you’re a business that operates in North America, it’s important to stay abreast of the latest developments related to the USMCA. Keep an eye on the news and be prepared to adjust your operations as needed once the agreement is fully implemented.