Canada - Commercial Guide
Trade Agreements

Describes bilateral and multilateral trade agreements that this country is party to, including with the United States. Includes websites and other resources where U.S. companies can get more information on how to take advantage of these agreements.

Last published date: 2020-08-03

USMCA

The United States, Mexico, and Canada are parties to the United States–Mexico–Canada Agreement (USMCA), which entered in to force on July 1, 2020, replacing the North American Free Trade Agreement (NAFTA). Qualifying goods and services which had zero tariffs under NAFTA will remain at zero under USMCA. For additional information on tariffs, see the Trade Barriers section of this guide and/or visit the FTA Tariff Tool and the FTA Resources Toolbox on our FTA Help Center.

USMCA is a 21st century, high-standard trade agreement, supporting mutually beneficial trade resulting in freer markets, fairer trade, and robust economic growth in North America. The Agreement modernizes and rebalances U.S. trade relations with Mexico and Canada, and it reduces incentives to outsource by providing strong labor and environmental protections, innovative rules of origin, and revised investment provisions. The Agreement also brings labor and environment obligations into the core text of the agreement and makes them fully enforceable.

USMCA upgrades NAFTA in a number of key areas. For example, the USMCA establishes the strongest and most advanced provisions on intellectual property and digital trade ever included in a trade agreement. Updates to the Customs and Trade Facilitation Chapter will help reduce costs and bring greater predictability to cross-border transactions. Likewise, new chapters such as Good Regulatory Practices and SMEs will help to reduce and prevent non-tariff barriers through increased transparency, evidence-based decision-making, and whole-of-government internal coordination, and ​promote cooperation to help increase SME trade and investment opportunities, respectively. USMCA also includes a number of groundbreaking provisions to combat non-market practices— such as subsidies and currency manipulation—that have the potential to disadvantage U.S. workers and businesses. In addition, through updated rules of origin, the USMCA requires that 75% of auto content be produced in North America and that key auto core parts originate in North America.

For more information on the agreement, how to prepare for USMCA, differences between USMCA and NAFTA, new chapters, and more visit ITA’s USMCA webpage.