Skip to content
Tariffi
Trade Agreements

What is USMCA?

United States-Mexico-Canada Agreement — the trade agreement that replaced NAFTA in 2020, governing North American trade. In the context of U.S. customs and tariff recovery, understanding usmca is essential for navigating the CAPE refund process and ensuring accurate duty assessment.

Definition

The United States-Mexico-Canada Agreement (USMCA) is the trade agreement governing commerce between the three North American countries. It replaced NAFTA on July 1, 2020, after years of negotiation. Key changes from NAFTA include stricter auto rules of origin (75% regional value content, up from 62.5%), new digital trade provisions, stronger labor and environmental standards, a 16-year sunset clause with periodic review, and enhanced intellectual property protections. USMCA allows qualifying goods to enter duty-free or at preferential rates between member countries.

How USMCA Relates to Tariff Refunds

USMCA preferential treatment reduces or eliminates duties on qualifying goods from Mexico and Canada. These preferential duties are separate from IEEPA and Section 301 tariffs (which primarily target China). If goods from Mexico or Canada are incorrectly denied USMCA treatment and pay the full MFN rate, the remedy is typically a protest or reconciliation, not a CAPE claim.

Example

An auto manufacturer imports engines from Mexico that meet the USMCA 75% regional value content rule. The engines enter duty-free under USMCA. If the manufacturer also imports components from China subject to Section 301, those Chinese components are CAPE-eligible while the Mexican engines are not (they already entered duty-free).

Frequently Asked Questions

Do I need a certificate of origin for USMCA?
USMCA uses a 'certification of origin' (not the traditional certificate). It can be self-certified by the exporter, producer, or importer — no government agency stamp is required.
Does USMCA affect Section 301 tariffs?
USMCA covers trade between the U.S., Mexico, and Canada. Section 301 tariffs primarily target China. The two programs address different trade relationships.

Related Terms

NAFTANorth American Free Trade Agreement — the predecessor trade agreement to USMCA, governing trade between the U.S., Mexico, and Canada from 1994 to 2020.Certificate of OriginDocument certifying the country where goods were manufactured, required for preferential tariff treatment.Most Favored NationThe normal (NTR) tariff rate applied to imports from WTO member countries, also called Normal Trade Relations.TariffA tax imposed on imported goods, used to protect domestic industries, raise revenue, or enforce trade policy.DutyA tax imposed by the government on imported goods, based on the HTS classification and country of origin.

Legal References

  • USMCA Implementation Act (2020)
  • 19 CFR Part 182 — USMCA Rules of Origin

Ready to recover your tariff overpayments?

Upload your ES-003 and see how much you could recover — no advance fees, no commitment.

Start your claim

Questions? support@tariffi.io