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United States, Mexico and Canada Agreement (USMCA)

The United States, Mexico and Canada signed the USMCA, the successor to NAFTA, on Nov. 30, 2018, and a revised version of the agreement was signed Dec. 10, 2019. All three countries ratified the agreement, the U.S. House of Representatives approved the USMCA on Dec. 19, 2019 and the U.S. Senate approved the agreement on Jan. 16, 2020. On January 29, 2020 President Trump signed into law the United States, Mexico and Canada Agreement (USMCA) replacing and modernizing the 25-year old North American Free Trade Agreement (NAFTA).

The most significant changes found in the USMCA include new laws on intellectual property and digital trade, as well as, updated chapters on financial services, labor and the

environment. However, noticeably absent in the push for modernization are changes to the Immigration Chapter of the old NAFTA.

TN Visa

The TN nonimmigrant visa classification permits qualified Canadian and Mexican citizens to seek temporary entry into the United States to engage in business activities at a professional level. Among the types of professionals eligible to seek admission as TN nonimmigrants are accountants, engineers, lawyers, pharmacists, scientists and teachers.

Canada and the US both claim that the new Agreement benefits workers in both countries. There are however, both clear winners and losers. While the preservation of the TN Visa is a victory for professionals on the list of eligible occupations many of whom feared that President Trump would cancel the Visa program entirely. President Trump had claimed that he would end the program in order to promote his “Buy American, Hire American” initiative, or at least restrict the list of professions and limit visa renewals.

Despite an attempt by Canada and Mexico to expand the TN Professions List to include professions that did not exist in 1994 (when NAFTA was approved) and bring it into the 21st Century, the Immigration Chapter remains untouched and in desperate need of updating. Such professions include those in the IT Sector who remain excluded and this represents a loss for digital or tech workers.

Both Canada and the US claim that the revamped trade agreement benefits workers in both countries, however there are some clear winners and losers in regards to the unchanged visa provisions.

Canadian businesses can continue to hire skilled American and Mexican workers without having to comply with complicated Labor Market Impact Assessment. This means that employers need not provide evidence that a Canadian cannot fill the position. Similarly, certain Canadian professionals may continue to work in the US without a visa.

Buy American and Hire American Executive Order

The “Buy American and Hire American” Executive Order (BAHA) signed by President Trump on April 18, 2017 has widely impacted U.S. immigration generally, including the TN visa

classification and processing of L-1 Intracompany Transfer Petitions by Canadian citizens at the U.S. Ports-of-Entry.

Business travelers who seek admission to the US for business purposes including sales calls, trade shows, conferences, after-sales service etc. are now subject to greater scrutiny at the Border. BAHA has had a chilling effect on U.S. cross-border immigration. For example, there is increased scrutiny and harsher standards applied in the adjudication of work-sponsored petitions/applications filed on behalf of potential Canadian workers at the border.

Both employers and business travelers will be victims of BAHA. For employers, a refusal by CBP to adjudicate L-1 Intra-Company Transfer extensions at the border will result in an increase in the need to file Petitions with USCIS and pay the Filing Fees and $1,440 Premium Processing Fee to expedite processing, but with increasing demands by USCIS for further information in the form of Requests for Evidence, delays are expected.

Business travelers who need to frequently meet with counterparts or customers are now routinely questioned about the reason for and frequency of business travel. This will further impact US/Canada competitiveness.

Temporary Travel Restrictions due to Covid-19

The USMCA does not alter the temporary travel restrictions that are in effect as a result of the covid-19 pandemic that are in force at the US borders with Canada and Mexico. Admission restrictions for non-essential business travel will remain in place for the foreseeable future, as will restrictions on certain business visa categories that many Canadian and Mexican businesses are using to move their employees into critical positions in the US as a result of the problems caused by BAHA.

The increased immigration challenges caused by BAHA and other executive orders may leadone to question whether BAHA will actually make America great again.

However, it is not all doom and gloom.

With the implementation of the USMCA, U.S. farmers and ranchers are eager to realize the more than $2 billion in additional farm exports and $65 billion in gross domestic product the pact is expected to provide.

“This trade agreement comes at a critical time for farmers and ranchers. USMCA is an important step toward restoring the competitiveness of America’s farmers and ranchers, strengthening our trade relationships in North America and setting an example for agreements with other important trading partners,” American Farm Bureau President Zippy Duvall said in a statement.

According to the American Farm Bureau:

  • “the USMCA builds on important trade relationships in North America.

  • The agreement is expected to increase U.S. agricultural exports by $2 billion and result in a $65 billion increase in gross domestic product.

  • The agreement will provide new market access for American dairy and poultry products while preserving the zero-tariff platform on all other ag products.

  • In particular, the agreement gives U.S. dairy products access to an additional 3.6% of Canada’s dairy market – even better than what was proposed in the Trans-Pacific Partnership trade agreement.

  • U.S. wheat will be treated more fairly, thanks to Canada’s agreement to grade our wheat no less favorably than its own.

  • Mexico and the United States have also agreed that all grading standards for ag products will be non-discriminatory.

  • Additional provisions enhance science-based trading standards among the three nations as the basis for sanitary and phytosanitary measures for ag products, as well as progress in the area of geographic indications.

  • The agreement also includes measures that address cooperation, information sharing and other trade rules among the three nations related to agricultural biotechnology and gene editing.


ABOUT THE AUTHOR: Anthony Korda, Esq., is the owner of The Korda Law Firm with offices located in Naples, Florida; Beverly Hills, California, and a presence in London. He is admitted to the Bars of California and DC and is a Barrister of the Supreme Court of England & Wales, where he is authorized to accept Direct Access cases. LEARN MORE ABOUT ANTHONY


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