Much-awaited USMCA auto regulations released

On June 3, the U.S. Mexico-Canada Agreement (USMCA) uniform regulations for automotive rules of origin were published, a much-awaited step ahead of the USMCA going into effect July 2, 2020. The regulations include specific formulas and information on how automakers must comply with the new, stricter rules to qualify for reduced tariffs under USMCA. U.S. automakers have less than a month to implement the new rules unless they petition for a longer transition period.  Some automakers will likely apply for transition plans, which may last up to five years. Automakers are working to comply with the requirement that a significant portion of auto content be made with high-wage labor, as well as stricter rules for regional value content (i.e., percent of auto content made in North America) and steel and aluminum sourcing. Mexico has also published the uniform regulations tied to other industries.

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