Law360 is providing free access to its coronavirus coverage to make sure all members of the legal community have accurate information in this time of uncertainty and change. Use the form below to sign up for any of our weekly newsletters. Signing up for any of our section newsletters will opt you in to the weekly Coronavirus briefing.
Sign up for our International Trade newsletter
You must correct or enter the following before you can sign up:
Thank You!
Law360 (March 30, 2020, 7:09 PM EDT) -- Nineteen members of the Senate Finance Committee on Monday warned the Trump administration against trying to implement its new trade deal with Canada and Mexico too quickly in light of the novel coronavirus outbreak's ravaging of U.S. businesses.
Committee Chairman Chuck Grassley, R-Iowa, and ranking member Ron Wyden, D-Ore., spearheaded a letter that implored U.S. Trade Representative Robert Lighthizer to back off the White House's apparent plan to bring the U.S.-Mexico-Canada Agreement into force by June 1 as the country deals with the blowback of a global pandemic.
"USMCA should not enter into force prematurely — particularly in light of the COVID-19 pandemic — and thereby deny American farmers, workers and businesses its intended benefits," they wrote. "We ask you to delay the proposed June 1 entry into force and work with Congress and stakeholders to determine a more feasible timeline."
All three governments have ratified the USMCA, and are now working on the alignment of their domestic regulations to put the deal into force. It is a highly technical and complicated process, particularly for the motor vehicle industry, which saw a drastic rewrite of the North American Free Trade Agreement's automotive rules of origin.
To implement the deal by June 1, the U.S., Mexico and Canada would all have to issue notifications in the next two days that their regulations have been updated to comply with the USMCA text.
Businesses that will have to abide by those new rules are simply swamped by the coronavirus and the effect it is having on the national workforce, the senators said.
"The COVID-19 pandemic has impacted governments, businesses, workers and farmers globally, leaving little, if any, time and resources to prepare for a smooth transition to USMCA," the senators wrote, adding that a June 1 deadline would be "highly aggressive" even without the coronavirus crisis.
The USTR did not immediately respond to a request for comment Monday.
The agency has not publicly confirmed its intention to implement the agreement by June 1, but Grassley himself took to the Senate floor two weeks ago to begin warning the administration against that plan. The chairman's letter secured support from both sides of the aisle, with 19 of the Finance Committee's 28 members signing on.
Negotiations for the USMCA wrapped up in 2018, but the Trump administration spent much of the following year in subsequent negotiations with congressional Democrats who wanted to strengthen the deal's labor, environmental and drug pricing provisions.
Those talks produced a new version of the deal that earned the support of the AFL-CIO and numerous other unions that helped the agreement sail through Congress.
With the USMCA poised to replace the controversial NAFTA, the lawmakers are urging the White House to be particularly vigilant in ensuring that its dutifully enacted and enforced.
"A long experience of incomplete and inadequate implementation by trade agreement partners has taught us that the United States must do this work on the front end to ensure that the words on paper deliver genuine benefits to Americans, including our farmers, workers and businesses," the senators wrote.
--Editing by Stephen Berg.
For a reprint of this article, please contact reprints@law360.com.
