At a glance

  • The United States-Mexico-Canada Agreement (USMCA) will not take effect until it is ratified by Canada and all three signatory countries complete preparatory steps toward implementation.
  • Until the USMCA is implemented, NAFTA will remain in effect, including its labor mobility provisions.

A closer look

President Trump today signed H.R. 5430, the United States-Mexico-Canada Agreement Implementation Act, which ratifies the trade agreement that will soon replace the North American Free Trade Agreement (NAFTA). H.R. 5430 was passed by Congress on January 16.

The leaders of Canada, Mexico and the United States signed the USMCA in November 2018. The labor mobility provisions of the USMCA – which ease the cross-border movement of businesspersons, intracompany transferees, certain professionals, investors, and traders – are largely the same as those of NAFTA. At the time the three leaders signed the USMCA, House Democrats expressed concerns about some of its provisions, including those related to labor and environmental standards. Further negotiations in recent months have resulted in revisions on those issues. The labor mobility provisions of USMCA were not affected by those negotiations, however.

What's next for the USMCA

Canada began the USMCA ratification process earlier this week. Once it has ratified the pact, all three signatory countries must complete threshold obligations set forth in the agreement, after which the USMCA can be implemented.

Until the USMCA takes effect, the labor mobility provisions and procedures of NAFTA will remain in place.

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