Today the Trump Administration sent a letter notifying Congress of its intent to renegotiate NAFTA. The notification was required by the Bipartisan Congressional Trade Priorities and Accountability Act of 2015 (TPA). By complying with this and other requirements in TPA, legislation required to implement a renegotiated NAFTA will be subject to streamlined procedures in Congress.
The Administration may now initiate negotiations with Canada and Mexico 90 or more days after sending the letter. The Administration is required by TPA to continue to consult with the House Ways & Means Committee and the Senate Finance Committee, as well as the House Advisory Group on Negotiations and the Senate Advisory Group on Negotiations. In addition, at least 30 days before initiating negotiations, a detailed and comprehensive summary of the negotiation’s specific objectives and how a renegotiated NAFTA would further those objectives and benefit the United States must be published on the U.S. Trade Representative website.
Unlike the draft of the letter that was leaked several weeks ago, the notification letter does not give much detail on the Administration’s objectives in renegotiating NAFTA other than to update and modernize the agreement. The letter says that the Administration will seek new provisions to address intellectual property rights, regulatory practices, state-owned enterprises, services, customs procedures, sanitary and phytosanitary measures, labor, environment, and small and medium enterprises. The Administration earlier raised concerns about NAFTA’s rules of origin provisions and dispute mechanism for trade remedy cases, but neither are mentioned in the letter.
The Administration has said that a renegotiated NAFTA will be the template for future agreements, possibly with the United Kingdom and Japan. Thus, it will be important for interested parties to engage in the negotiations, even if their issues are not prominent in NAFTA.