USMCA implementation July 1st!

Posted by Jay Devers
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With an express goal to bring manufacturing back to the United States, the USMCA trade agreement will go into effect on July 1, 2020. With several important changes in the new iteration, USCBP will be offering a help center staffed with experts for those concerned they won’t have enough time or guidance on the implementation procedure. Official implementation instructions haven’t been sent out yet but interim instructions are available and Bestway has an overview of the most critical updates you’ll need to know.

Updated de minimis thresholds:

  • Canada – $150 CAD for customs and $40 CAD for taxes
  • USA – $800 USD
  • Mexico – $117 USD for customs and $50 USD for taxes

Sunset Clause

  • A 16-year full term on the USMCA
  • After 6 years – review to extend, vacate or renegotiate

Automobiles

Enhanced Regional Value Content for

  • Total car – 75%
  • Core parts – 75%
  • Principal parts – 70%
  • Complementary parts – 65%

Labor requiring $16 per hour average pay

  • Automobiles – 40%
  • Light Trucks – 45%

Certificate of origin rules

  • Importers will no longer need to submit a formal certification document.
  • Commercial invoices can now be used as documentation of the certificate of origin
  • Importers, exporters, or producers of the goods can create documentation

As explained in the interim implementation instructions published April 16th, “Section 202 of the USMCA Implementation Act specifies the rules of origin used to determine whether a good qualifies as an originating good under the Agreement. The HTSUS will be amended to include GN 11, which includes both the general and specific rules of origin, definitions, and other related provisions.” GN 11 can be found in the HTSUS 2014.

Though there may be changes and updates in the official implementation rules, we feel confident that the overview will help everyone start the process for compliance once the USMCA goes into effect. We recommend that any questions be directed to Bestway so we can all get off on the right foot and not be crushed for time when the USMCA arrives. Your Bestway representatives are here to be a resource for you and if we can’t answer a question, we know where to go to find the answer. Our experience is at your service.

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