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Canada: Update on trade agreement with United States, Mexico

Canada: Trade agreement with United States, Mexico

Canadian importers and exporters need to consider how they will be affected by the pending trade agreement with the United States and Mexico.


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Leaders from all three countries agreed to final revisions to the United States-Mexico-Canada Agreement (USMCA) on 10 December 2019, meaning that the stage is set for the trade agreement to be considered by each country legislature. Once the legislative procedures to ratify the agreement are completed, the agreement—which Canada calls the “CUSMA”—would replace the North American Free Trade Agreement (NAFTA), and is currently expected to enter into force in 2021.

As a result, companies need to consider how to plan for the new trade agreement and specifically, companies in various industries need to:

  • Review the new rules of origin for their products
  • Validate product classifications and costing information
  • Understand the impact of new "de minimis" thresholds on cross-border transactions
  • Reassess the overall structure of their global supply chains

Read a December 2019 report [PDF 180 KB] prepared by the KPMG member firm in Canada

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