On August 31, after a week of talks, Canada and the United States failed to reach agreement on a new NAFTA that aligns with the bilateral U.S.-Mexico agreement reached on August 27. Among the key outstanding issues is the U.S. objective of opening up Canada’s dairy market and the Canadian objective of maintaining Chapter 19 of the original NAFTA’s dispute settlement for antidumping and countervailing duty cases. Canada will resume negotiations with the U.S. on September 5.

Despite the breakdown in talks, the Trump administration notified to Congress its intent to sign an agreement with Mexico, noting also the possible inclusion of Canada if agreement is eventually reached. The notification begins the 90-day timeline under Trade Promotion Authority (TPA) after which the administration can, according to USTR, legally sign an agreement with both Mexico and Canada. Although there are some legal questions as to whether adding Canada after the notification would fulfill TPA notification requirements, it is not likely to face significant challenge (most would like to see Canada included in the agreement).

60 days prior to signature, however, the Trump administration is still required under TPA to publish the text of the new NAFTA agreement, meaning a text must be agreed to and released by October 1 in order to achieve the administration’s goal of a signed agreement before December 1, when Mexican President Enrique Pena Nieto’s term ends. This likely means that Canada and the U.S. would have to agree on terms by the start of October, if not before.

If no agreement with Canada is reached, it remains possible that the Trump Administration would seek to terminate the existing NAFTA and replace it with the August 27 bilateral U.S.-Mexico agreement. This of course would raise the significant legal and political concerns noted in our August 29 post.

 

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Photo of Daniel Cannistra Daniel Cannistra

Dan Cannistra is a partner in the firm’s Washington, D.C. office. His practice focuses on legislative, executive and regulatory representation of domestic and international clients on a broad spectrum of international trade matters. Dan has represented domestic and foreign companies in over 75

Dan Cannistra is a partner in the firm’s Washington, D.C. office. His practice focuses on legislative, executive and regulatory representation of domestic and international clients on a broad spectrum of international trade matters. Dan has represented domestic and foreign companies in over 75 U.S. antidumping and countervailing duty cases before the U.S. Department of Commerce and the U.S. International Trade Commission under the Tariff Act of 1930. Many of these matters involved appeals to the U.S. Court of International Trade, the U.S. Court of Appeals for the Federal Circuit, binational panels under the North American Free Trade Agreement (NAFTA), and dispute settlement proceedings before the World Trade Organization (WTO). Dan has also represented clients in antidumping proceedings in the European Union, Canada, Mexico, Brazil, India, Thailand, Singapore, Guatemala and Taiwan.

Prior to joining Crowell & Moring, Dan was a director in a national accounting firm providing customs and international trade guidance to multinational clients related to the supply and distribution of goods and services across international borders. Areas of specialization included antidumping and countervailing duties and policy, trade remedies and litigation, free trade agreements and negotiations, classification and valuation, and international trade and development.

Dan’s government appointments include service to U.S. Trade Representative on the roster of international trade practitioners to resolve antidumping disputes involving NAFTA members. For the European Commission, Dan provided advice and training on international trade and antidumping methodology and practice. In addition, Dan has served as an international trade consultant to the governments of Guatemala and Singapore, providing technical advice to these governments on the application of international trade regulations consistent with international law and World Trade Organization agreements and the General Agreement on Tariffs and Trade, Agreement on Antidumping.