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US, Mexico, and Canada open first joint review of USMCA trade pact

US, Mexico, and Canada open first joint review of USMCA trade pact

Rule Changes

A July 1 deadline forces the three governments to decide whether to lock in the deal for another 16 years or start a countdown to its 2036 expiration

Today: Joint review formally opens

Overview

The trade deal covering roughly $1.8 trillion in yearly commerce between the United States, Mexico, and Canada came with a built-in deadline. That deadline is now. On July 1, 2026, the three governments formally opened the first joint review of the United States-Mexico-Canada Agreement (USMCA), and they have to decide whether to keep it alive for another 16 years.

Agree, and the pact runs to 2042 with the next review in 2032. Fail to agree, and the deal drops into a cycle of annual reviews that can run until 2036, when it can expire. The review lands while the US is separately pressing Mexico to require that half of every North American car's content come from American factories.

Why it matters

If the three governments can't agree to extend, North American supply chains face a decade of annual uncertainty over whether duty-free trade survives past 2036.

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Key Indicators

$1.8T
Annual trilateral trade
Estimated yearly trade in goods and services governed by the pact.
16 years
Extension term at stake
A unanimous yes extends the deal to 2042; the term is fixed in the treaty.
75% → 82%
Proposed auto content rule
US negotiators want to raise the regional value content threshold for cars from 75% to 82%.
2036
Possible termination year
If no consensus is ever reached in annual reviews, the deal can end July 1, 2036.
~70%
Chinese-brand share of Mexico EV sales
Industry trackers' 2025 estimate, a flashpoint in US concerns about a China 'backdoor'.

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People Involved

Jamieson Greer
Jamieson Greer
Leading the US negotiating effort
 Marcelo Ebrard
Marcelo Ebrard
Leading Mexico's negotiations
 Claudia Sheinbaum
Claudia Sheinbaum
Publicly backing a full 16-year extension
 Mark Carney
Mark Carney
Taking a defensive posture toward US demands

Organizations Involved

Office of the United States Trade Representative
Office of the United States Trade Representative
Federal Agency
Driving the US side of the review

The federal office that negotiates US trade agreements and is running Washington's push to tighten USMCA's auto and enforcement rules.
FT
USMCA Free Trade Commission
Trilateral Trade Body
Convenes the joint review

The trilateral body of trade ministers that oversees the agreement and formally convenes the joint review required under Article 34.7.

Timeline

July 2020 July 2026

6 events Latest: Today
Tap a bar to jump to that date

  1. Joint review formally opens

    Today Milestone

    The three governments open the first mandatory review and start deciding whether to extend the pact 16 years.

  2. US demands 50% US content in autos

    Negotiation

    In Mexico City talks, US negotiators seek half of car content from US plants and an 82% regional threshold.

  3. US and Mexico launch bilateral talks

    Negotiation

    Greer and Ebrard begin scoping rounds on rules of origin, supply chains, and foreign-investment review.

  4. USTR reports to Congress

    Process

    The US Trade Representative delivers its assessment and recommendations to lawmakers.

  5. US opens public consultations

    Process

    The US Trade Representative starts gathering input from industry and the public ahead of the review.

  6. USMCA enters into force

    Milestone

    The pact replaces NAFTA and starts a six-year clock to its first mandatory review.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

August 2017 – November 2018

NAFTA renegotiation becomes USMCA (2017–2018)

President Trump called NAFTA the worst trade deal ever and threatened to withdraw. After 13 months of tense talks, the US, Mexico, and Canada agreed on a replacement. The new deal raised auto content rules and added a sunset clause that created the very review now underway.

Then

The three countries signed the USMCA in late 2018; it took effect July 1, 2020.

Now

The sunset clause built into that deal is what forces the 2026 review and the 16-year extension decision.

Why this matters now

The current review runs on rules written in 2018. The same auto-content fight that dominated then is back at the center now.

1987 – 1988

Canada-US Free Trade Agreement and the 1988 election

The US and Canada negotiated a free trade deal that became the biggest issue in Canada's 1988 federal election. Critics warned it would erode Canadian sovereignty. Prime Minister Brian Mulroney won and the deal took effect in 1989, later folding into NAFTA.

Then

The agreement opened most US-Canada trade to duty-free treatment.

Now

It set the template for NAFTA and decades of deep North American integration.

Why this matters now

It shows how trade terms become questions of national control. Carney's line that Washington can't dictate terms echoes that older fight.

January 1994

The original NAFTA takes effect (1994)

NAFTA linked the US, Mexico, and Canada into one duty-free zone. It reshaped manufacturing, sending auto and parts plants across the Mexican border and knitting supply chains together over three decades.

Then

Trade among the three countries grew sharply through the 1990s and 2000s.

Now

It built the integrated auto supply chain that makes today's 50% US-content demand so disruptive.

Why this matters now

The deep integration NAFTA created is exactly why a sharp change to content rules now is hard to unwind without hurting all three economies.

Sources

(8)
+2
Brookings Institution Center for Strategic and International Studies Congressional Research Service The Globe and Mail The Detroit News Office of the United States Trade Representative Baker Institute Congressional Research Service