The following is an excerpt from a recent post by Melissa Miller Proctor of the Polsinelli on International blog.
On July 17, 2017, the USTR published a summary of its specific objectives for the renegotiation of the North American Free Trade Agreement (NAFTA) as required by the Bipartisan Congressional Trade Priorities and Accountability Act of 2015. In its July 17th notice, the USTR acknowledged that the NAFTA, since its entry into force in 1994, contributed to the linking of the continent through trade and provided new market access opportunities for American farmers and ranchers; however, the USTR also stated that the NAFTA created new problems for many American workers as a result of the increase in trade deficits and closing of U.S. factories. U.S. companies doing business in Canada and Mexico, whether sourcing or marketing goods in those markets, should take note of these latest developments, assess how any modifications made to the NAFTA could impact their cross-border operations, and consider reaching out to members of Congress and other Government decision-makers to ensure that their interests are fully protected.
By way of background, as we have reported previously, the USTR submitted a formal notification to Congress of the Administration’s specific negotiation objectives on May 18, 2017, following Robert Lighthizer’s confirmation. The USTR subsequently requested public comments from interested parties with regard to the modernization of the NAFTA and held a public hearing at the International Trade Commission. The USTR received more than 12,000 written responses and heard the testimony of more than 140 witnesses during the hearing, representing various industry sectors. The majority of comments that were submitted, as well as the testimony presented, reflected U.S. industries’ support of the NAFTA because of increased U.S. exports to Mexico and Canada since 1994. They also urged that negotiations should not jeopardize existing market access gains and that the key negotiating principle should be, “Do No Harm” as suggested previously by USTR Lighthizer during his testimony before a House of Representatives Committee in June.
The USTR noted that its specific negotiation objectives issued on July 17th reflect the input received from Congressional, agency and industry consultations, public comments, and testimony given at the hearing and that it will continue these consultations and will update the objectives as the negotiations proceed. Per the USTR’s specific negotiation objectives, the overall goals will be to break down barriers to American exports through the elimination of unfair subsidies, market-distorting practices by state owned enterprises, and burdensome restrictions of intellectual property. The USTR’s objectives will also target the modernization of the NAFTA to reflect 21st century standards, address America’s trade imbalances in North America, and ensure that the United States obtains more open, equitable, secure, and reciprocal market access…
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