crs_reports: R48964

Congressional Research Service reports with summaries, authors, and topic classifications.

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R48964 USMCA Joint Review: Background on Prior Negotiations and Selected Issues for Congress 2026-06-02T04:00:00Z 2026-06-06T05:53:44Z Active Reports Kyla H. Kitamura, Christopher A. Casey, Shayerah I. Akhtar, Danielle M. Trachtenberg, Cathleen D. Cimino-Isaacs, Michael D. Sutherland Latin America, Caribbean & Canada, U.S. Trade Policy, U.S.-Mexico-Canada Agreement (USMCA), Major Economies & U.S. Trade Relations, Trade Agreements In 2026, the United States, Canada, and Mexico are scheduled to conduct a review of the United States-Mexico-Canada Agreement (USMCA) that could result in the revision or phasing out of the agreement. The review is the first of its kind in any U.S. Free Trade Agreement (FTA). Congress was heavily involved in shaping U.S. priorities during the negotiation of USMCA. Congress also approved USMCA and enacted legislation in 2020 to implement the agreement. In its oversight capacity, Congress may request consultations with the executive branch regarding USMCA implementation and the review process. Members of Congress may also consider whether—and, if so, to what extent—congressional priorities raised during the 2017-2019 USMCA negotiations have been addressed and/or implemented, and whether to pursue any changes to USMCA as part of the review process. Congress could also assess the advantages and disadvantages of comprehensive FTAs for the U.S. economy and the lessons learned from the negotiation, implementation, and review of USMCA. A key trade policy issue for Congress at the time of USMCA negotiations related to President Trump’s threats to potentially withdraw from the trilateral 1994 North American Free Trade Agreement (NAFTA), and what that might imply about shared or overlapping congressional-executive authorities on U.S. trade policy. Other issues that were a focus of congressional attention included adding a clause requiring periodic reviews of USMCA, the first such provision in a U.S. FTA; making changes to the rules for duty-free trade of automotive products; modernizing the agreement by including digital trade provisions and updating intellectual property rights protections; changing and removing some investor-state dispute settlement provisions; enhancing provisions related to labor and environment standards; modifying government procurement provisions; and determining whether to retain NAFTA’s binational dispute settlement mechanism. In response to concerns expressed by some Members and other policymakers, USMCA included a new nonmarket economy clause that requires a party to notify the other parties of any efforts to enter into an FTA with a nonmarket economy such as China. In August 2017, the United States, Mexico, and Canada officially launched the “renegotiation and modernization” of NAFTA. At the time of its negotiation in the 1990s, NAFTA was the most comprehensive free trade agreement (FTA) that the United States had negotiated. It eliminated nearly all tariffs and most nontariff barriers on trade within North America, and it contained novel provisions that influenced subsequent U.S. trade policy and U.S. FTAs. The negotiation and approval of NAFTA was widely debated in Congress, with proponents arguing that the agreement would help generate jobs and reduce income disparity, while opponents warned that the agreement would result in companies moving operations to Mexico, leading to U.S. job losses. U.S. stakeholder opinions on NAFTA remained divided more than two decades after the agreement went into effect. The renegotiation of NAFTA ultimately resulted in USMCA. Congress approved USMCA and enacted its implementing legislation under rules set out in the Bipartisan Congressional Trade Priorities and Accountability Act of 2015 (TPA-2015; P.L. 114-26, Title 1), which expired in 2021. In May 2017, the Trump Administration notified Congress of its intent to begin trade talks with Canada and Mexico, as required by TPA-2015. Negotiations officially began on August 16, 2017. In November 2018, the United States, Mexico, and Canada signed USMCA. In December 2019, the three parties signed a protocol to amend the agreement text, in part due to congressional pressure to revise certain provisions. In 2020, Congress passed, and the President signed, the United States-Mexico-Canada Agreement Implementation Act (P.L. 116-113), and USMCA entered into force on July 1, 2020, replacing NAFTA. The negotiations that led to that moment, and Congress’s role in them, help provide a roadmap of issues now facing Congress as the United States, Canada, and Mexico embark on a review of USMCA that could result in the revision or phasing out of the agreement. For additional information on the USMCA joint review process and the role of Congress, see CRS Report R48787, USMCA Joint Review: Process and Role of Congress. https://www.congress.gov/crs_external_products/R/PDF/R48964/R48964.4.pdf https://www.congress.gov/crs_external_products/R/HTML/R48964.html

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