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The three parties to the United States – Mexico – Canada Agreement (USMCA) are beginning domestic consultations ahead of the scheduled 2026 joint review, which could lead to changes in the agreement.
For the United States, the Trump administration will likely withhold US renewal approval to compel a partial renegotiation of certain commitments through the joint review. The full scope of the US plan has not yet been developed, but initiatives under discussion in Washington include modifications to the automotive industry rules of origin, strengthened forced labor import prohibitions, new restrictions on Chinese companies in North America, and resolutions to ongoing USMCA implementation disputes.
The threatened levies would appear to violate the terms of the U.S.-Mexico-Canada Agreement (USMCA) on trade. The deal, which Trump signed into law, took effect in 2020 and continued the largely duty-free trade between the three North American countries; the deal will undergo a revision in 2026.
Warren Maruyama, former general counsel for the U.S. Trade Representative under President George H.W. Bush, said Trump could declare a national emergency, which would unlock the International Emergency Economic Powers Act and allow him to impose the tariffs with relative ease.
“If precedent is any indication, it’s a serious uphill fight” to challenge actions taken under that umbrella, Murayama said.
The tariffs could also prompt an early renegotiation of the USMCA, ahead of the planned 2026 review, trade experts said.
TYT Newsroom