Last updated November 2026. This page was rewritten after the July 1 joint review, the July 20 Section 338 proclamations, and the August 22 start of Section 338 duties. Earlier versions predicted the agreement would be extended. It wasn’t.
On July 1, 2026, the United States declined to renew the USMCA in its current form.
The agreement didn’t end. It moved into a cycle of annual reviews that runs to 2036, and for most importers, nothing about daily customs filing changed that morning. Your certificates are still valid. Your rules of origin are unchanged. Duty-free treatment for qualifying goods continues.
What did change is the assumption sitting underneath all of it. For six years, “USMCA compliant” was shorthand for “enters duty-free.” Nineteen days after the review, that stopped being categorically true.
What USMCA Compliance Means
USMCA compliance means a good meets the United States-Mexico-Canada Agreement’s rules of origin and qualifies for preferential duty-free treatment between the three countries. It requires correct tariff classification, satisfying the product-specific origin rule, holding a valid certification of origin with all nine required data elements, and keeping supporting records for five years.
That definition hasn’t moved since 2020. What’s moved is everything around it.
What Actually Happened on July 1
The USMCA Free Trade Commission held the mandatory six-year joint review required under Article 34.7. The United States declined to confirm its intention to extend the agreement for another 16 years, stating it did not agree to renew the USMCA in its current form.
That triggered the annual review process under Article 34.7.4. What it means in practice:
- The agreement stays fully in force. It runs to July 1, 2036 unless the parties agree to extend it.
- A 16-year extension is still available at any point, through written confirmation by the three heads of government.
- Reviews now happen every year instead of every six. The next is in 2027, and USTR is already taking public comments for it until January 12, 2027.
- Nothing about your filing changed. Same rules, same certificates, same procedures.
Bilateral negotiations between the U.S. and Mexico have run in parallel. Round one met in Mexico City in late May and covered automotive rules of origin, steel and aluminum, and economic security. Round two met in Washington in mid-June and moved into industrial goods, agriculture, labor, and the environment. Round three concluded in Mexico City on July 23. Both governments reported progress on steel and aluminum, automotive rules of origin, labor, agriculture, economic security and electronic payment services, and a shared concern about non-member countries benefiting from the agreement without carrying its obligations.
Round four was set for Washington in September, then pushed back more than once. Mexico’s economy secretary has since said it will take place before the end of 2026. The sticking point is the same one it has been all year: the U.S. demand for more U.S.-specific content in vehicles. The U.S. trade representative has also said the talks will “probably” be bilateral, so expect separate U.S.-Mexico and U.S.-Canada tracks rather than one three-way negotiation.
Mexico’s economy ministry says the number of open U.S. concerns has narrowed from 54 to 14. That’s progress, but the shape of the remaining 14 matters more than the count.
If you’re unsure how the review affects your product lines, our tariff consulting team can assess your exposure before the next round.
What USMCA Compliance No Longer Protects You From
This is the part most compliance guidance still hasn’t caught up with, and it’s the reason to re-run landed cost models on Canadian goods now rather than next quarter.
On July 20, 2026, three presidential proclamations invoked Section 338 of the Tariff Act of 1930 to impose an additional 50% duty on certain Canadian goods. The duties were due August 19. The evening before, a further proclamation suspended them for three days while talks continued. No deal came, and the duties took effect at 12:01 a.m. Eastern on August 22, 2026.
The three proclamations track three disputes, motor vehicles, alcoholic beverages and dairy, but the coverage does not follow those labels. The proclamation tied to the automotive dispute reaches a broad list of other goods: cement, seeds, clothing, fishing rods, swimming pools, hockey equipment. The importer most likely to be caught is the one who checked the auto and dairy lists, concluded the exposure was manageable, and moved on.
None of the proclamations contains a USMCA carve-out. A valid certificate of origin does not exempt a covered good. USMCA qualification on its own buys nothing here.
The lists have already changed twice
Don’t treat the July annexes as the final word:
- September 8 (effective September 15): more dairy and wood products, furniture and motorboats were added, and some items were removed. The updated lists also pulled in some goods already under Section 232, with the 232 duty applying on top. The original rule that Section 232 goods were excluded no longer holds across the board.
- October 23 (effective October 30): plywood sheets, some paper products, certain machinery and refrigeration equipment, and certain packing crates were removed. Cocoa powder, some paper products, valves, carpets and waste products were added.
Energy, potash, fish and critical minerals have stayed outside the duties so far.
Some goods are now barred, not just tariffed
Section 338 also lets the President go past a tariff to an outright import ban, and that has now happened. Proclamations signed September 8 barred the importation of certain Canadian alcoholic beverages, certain dairy products, molasses and motorcycles, effective September 29. On those lines there is no duty to model. The goods can’t enter.
Where this stands
The Congressional Research Service puts coverage at about $20 billion of Canadian goods, roughly 5% of U.S. imports from Canada, and that figure has held steady through the list changes. Most Canadian export value still enters duty-free under USMCA, so this is not a collapse of the agreement’s value. It’s a hole in it, in specific product lines, that a certificate cannot patch.
Canada retaliated with its own tariffs on U.S. goods from September 8, matched dollar for dollar at roughly C$27.5 billion. On August 24, the President also said on social media that tariffs on Canadian cars, trucks, auto parts and steel would rise to 50% on January 1, 2027. That is a statement, not yet a proclamation, but automotive importers should plan around it.
The duties are now in court. An importer, Gellert Global Group, challenged them at the Court of International Trade on October 20. And Section 338 carries no expiration date: the duties stay until the President decides the discrimination has ended.
What to do about it
Check your HTS codes against the current lists, then check again each time they’re amended. Not the product category. The specific subheadings. Our licensed customs brokers can run your HTS list against the lists in force and tell you which lines are exposed.
If you use a foreign trade zone, covered goods must be admitted under Privileged Foreign Status. If you’re holding inventory in bonded warehousing, confirm the admission status of anything that could be covered.
Keep your Section 338 entry records. With the duties now being challenged in court, those entries belong in the same preserve-for-refund file as your Section 122 and Section 301 entries.
Who Is Actually Responsible for Your USMCA Claim
Worth being blunt about this, because importers get it wrong constantly and it is expensive when they do.
Your customs broker is not deciding whether your goods qualify. You are. A USMCA claim rests on information only the importer and the supplier hold: the bill of materials, the origin of every input, the production process, the value build-up. A broker transmits the preference claim on the entry using what you provide. No broker can verify a rule of origin against data it has never seen, and none should be certifying one on your behalf.
That distinction only surfaces when CBP asks. In a verification, CBP goes to the importer of record. You produce the certification, the bill of materials, and five years of records. If nobody at your company owns that file, the claim is exposed no matter who filed the entry.
So treat origin as a sourcing and compliance function you own, and treat your broker as the party who classifies the goods correctly, files accurately, and tells you when something on your HTS list turns up in a new annex. Different jobs. Confusing them is how importers arrive at a verification with nothing to hand over.
What Replaced the Section 122 Surcharge
The 10% global import surcharge imposed under Section 122 of the Trade Act of 1974 took effect February 24, 2026 and expired by operation of law at 12:01 a.m. Eastern on July 24, 2026. The statute caps such a surcharge at 150 days unless Congress extends it, and no extension passed.
USMCA-qualifying goods were exempt throughout, which is a large part of why utilization climbed so sharply. Among Mexican exporters it went from 44.8% in January 2025 to 85% in January 2026.
Two things importers get wrong about the expiry:
A surcharge ending doesn’t mean your bill shrinks. For goods that never qualified under USMCA, the 10% layer coming off didn’t return them to zero, because the replacement arrived the same minute. USTR announced final action in its forced-labor Section 301 investigations on July 23, effective 12:01 a.m. Eastern on July 24. There was no gap. The duties run in two tiers, 10% and 12.5%, across 60 economies. Canada and Mexico sit in the 10% tier.
USMCA-qualifying goods from Canada and Mexico are exempt. The exemption applies even where the USMCA preference indicator doesn’t appear on the specific tariff line. Goods already under Section 232 are also outside it. That makes Section 301 the second tariff action in a row built around USMCA origin, which is the strongest argument on this page for getting your qualification right.
Section 301 has no statutory rate cap and no sunset. If you treated the 10% surcharge as a temporary line item, treat this one as the baseline. If you source from China as well as North America, our coverage of Section 301 tariffs on Chinese imports explains how those layers stack.
Both actions are in court
The Section 301 duties are being challenged at the Court of International Trade in a consolidated case brought by small importers and 25 states. The court heard argument on September 30 and asked for further briefing in October. It has not ruled, and CBP keeps collecting in the meantime.
The Section 122 surcharge is a step further along. The Court of International Trade held it unlawful in May, the Federal Circuit stayed that ruling in June, and the appeal is still pending. If the courts ultimately void it, entries from February 24 through July 23 become refund candidates.
In both cases the paperwork is what makes a refund possible. Keep your entry records, and know your protest deadlines: a protest has to be filed within 180 days of each entry’s liquidation, and once that passes the refund right on that entry is gone.
Section 232 duties are untouched by any of this. Steel, aluminum and copper articles remain at 50%, autos at 25%.
How to Qualify Your Goods
Five steps, in order. Most disqualifications happen at step two or step three.
Step 1: Classify the product
Determine the correct HTS code. The classification decides which origin rule applies, so an error here invalidates everything downstream. HTS classification review is where most compliance projects should start.
Step 2: Find the applicable rule of origin
USMCA uses product-specific rules that vary by chapter. The common methods are tariff shift, which requires non-originating inputs to change classification during manufacturing, and regional value content, which requires a minimum percentage of value from North America. RVC is calculated using either the transaction value method or the net cost method, and the choice affects the outcome.
Step 3: Trace component sourcing
Identify the origin of every significant input. Pay particular attention to Chinese components, which can affect USMCA eligibility and Section 301 exposure at the same time. This is where U.S. concern about Chinese investment in Mexican manufacturing bites, and it’s a live negotiating issue. Companies restructuring around it often end up moving goods through cross trade arrangements that carry their own documentation requirements.
Step 4: Prepare the certification of origin
USMCA requires no specific form, but the certification must carry all nine required data elements covering the certifier, exporter, producer, importer, description of goods, and origin criteria. Format is flexible. Completeness isn’t. Our guide to how to complete a USMCA certificate of origin walks through each element. Note that the importer of record carries the legal responsibility for the claim, not the supplier who prepared the paperwork.
Step 5: Keep the records
Five years minimum. CBP can audit at any point in that window, and incomplete records mean denied claims, duties owed with interest, and potential penalties.
Not sure how your goods are classified, or which new tariff lists they fall under? Request a quote and our licensed brokers will review your HTS list line by line.
Where Importers Lose the Benefit
No certificate at entry
If the certification isn’t in hand when the entry is filed, the shipment may not be eligible for preference even when the goods genuinely qualify. This is the most common and most avoidable loss on this list, and it’s a frequent cause of the delays covered in our guide to how long customs clearance takes.
Applying the wrong origin standard
The substantial transformation test used for most imports doesn’t govern within the USMCA region. Companies applying it disqualify themselves from a benefit they’d earned.
Untracked Chinese content
Components sourced from China and assembled in Mexico create double exposure: they can break USMCA eligibility and trigger Section 301 at once.
Assuming the certificate covers everything
Since August 22, for Canadian goods on the Section 338 lists, it doesn’t. For a few lines it doesn’t even get the goods in the door.
Letting certifications go stale
Product composition changes. Suppliers change. A certification that was accurate two years ago may not describe what you’re importing today.
When USMCA Goods Are Also FDA-Regulated
Origin and admissibility are separate questions, and qualifying under USMCA does nothing to satisfy another agency.
FDA-regulated goods from Mexico or Canada still need FDA clearance, and food and beverages still require Prior Notice before arrival, plus FSVP for most food importers. A shipment can be perfectly USMCA-qualifying and still sit at the port because Prior Notice was filed late. Our guide to FDA import requirements covers the filings and timing in detail.
This overlap is most common in food transport, pharmaceutical transport, and medical device transport, where two sets of requirements attach to the same entry.
Automotive Faces the Largest Change
The automotive rules are already the most demanding in the agreement. Moving from NAFTA to USMCA raised the regional value content threshold from 62.5% to 75% and added two requirements that didn’t exist before: labor value content, which requires a share of content to be produced by workers earning at least $16 per hour, and North American steel and aluminum procurement.
The U.S. is pushing further. Washington’s asks include lifting the automotive RVC threshold to 82%, requiring at least half of a vehicle’s value to be sourced in the United States specifically rather than regionally, and tightening verification on the rule that 70% of a producer’s steel and aluminum come from North America. The U.S.-content demand is the issue that has held up the fourth U.S.-Mexico round.
Canada is a separate front. The September amendments brought some Section 232 automotive and metal goods onto the Section 338 lists, with both duties applying. Separately, the President has said tariffs on Canadian cars, trucks, parts and steel will rise to 50% on January 1, 2027.
None of that is settled. But the direction has been consistent across every negotiating round, and with annual reviews now the default, automotive sourcing decisions need to be made against a rulebook that can shift every year rather than every six.
Why Compliance Still Pays
Even with the Section 338 exception, the arithmetic favors qualifying.
Qualifying goods are exempt from the merchandise processing fee. That matters more than most importers realize, because it means USMCA can be worth claiming even when your MFN duty rate is already 0%. For high-volume importers, MPF savings alone can justify the compliance work.
Beyond that, compliance is a hedge. Section 122 exempted USMCA goods. The Section 301 forced-labor action that replaced it exempts them too: a qualifying Canadian or Mexican good pays nothing under it, while the same good without a valid claim pays 10%.
Nearly every tariff action of the past eighteen months has treated USMCA qualification as a dividing line, with Section 338 the notable exception. Companies that built the documentation infrastructure are positioned for whatever lands next. Companies that deferred run the same fire drill every time a proclamation drops.
What to Do Now
Now
Check every Canadian-origin HTS code against the current Section 338 lists, including the September and October amendments. Confirm none of your lines are on the import-ban lists. Re-run landed cost on anything covered. Confirm FTZ admissions are under Privileged Foreign Status.
Before year-end
If Canadian autos, parts or steel are in your supply chain, model the January 1, 2027 increase the President has announced. If you want a say in the next review, USTR’s comment deadline is January 12, 2027.
This quarter
Keep all entry records from February 24 to July 23 in case Section 122 refunds materialize, and keep Section 301 and Section 338 entries on the same basis now that both are in court. Track liquidation dates so no protest deadline passes unnoticed. Audit existing USMCA certifications against current product composition. Identify which goods qualify today and which are close enough to qualify with a sourcing change.
Ongoing
Track the annual review cycle. Watch automotive rules of origin and steel and aluminum verification most closely. Reassess when product composition or supplier base changes, not on a calendar.
Want your HTS list screened against the Section 338 lists in force today? Request a quote and we will tell you which lines are exposed.
Jade International’s licensed customs brokers handle the entry side: tariff classification, transmitting the preference claim you certify, screening your HTS list against new tariff lists, foreign trade zone and bonded admission status, and protest filing where duties may be recoverable. Origin determination stays with you and your supplier, which is where USMCA puts it, and where the records have to live if CBP asks.
See how our tariff consulting services work, review our import and customs brokerage support, or request a quote.
Frequently Asked Questions
What does USMCA compliant mean?
USMCA compliant means a product meets the United States-Mexico-Canada Agreement’s rules of origin and qualifies for preferential duty-free treatment when traded between the U.S., Canada, and Mexico. It requires correct classification, satisfying the product-specific origin rule, a valid certification of origin with all nine data elements, and five years of supporting records.
Did USMCA end on July 1, 2026?
No. The United States declined to renew the agreement for another 16-year term, which triggered annual reviews. The agreement remains fully in force through July 1, 2036 unless the parties agree to extend it, and an extension remains available at any time by written confirmation from the three heads of government. The next review is in 2027.
Does USMCA still mean duty-free?
For most goods, yes. But since August 22, 2026, Section 338 duties of an additional 50% have applied to certain Canadian products, with no USMCA carve-out. A valid certificate of origin does not exempt a covered good, and a few products, including certain alcoholic beverages, dairy, molasses and motorcycles, can’t be imported from Canada at all. The lists have been amended twice, so check your HTS codes against the current version.
What products qualify for USMCA?
Goods wholly obtained or produced in North America generally qualify. Goods containing non-regional components qualify only if they meet the product-specific rule of origin, which typically requires either a minimum regional value content percentage or a specified change in tariff classification during manufacturing.
What are the nine required data elements on a USMCA certificate?
USMCA requires no prescribed form, but the certification must identify the certifier, exporter, producer, and importer, describe the goods, state the origin criteria, cover the blanket period where applicable, and carry an authorized signature and certification statement. Any format is acceptable provided all elements are present. See our step-by-step guide to completing a USMCA certificate of origin.
Is USMCA worth claiming if my duty rate is already 0%?
Often, yes. USMCA-qualifying imports are exempt from the merchandise processing fee, which applies to most formal entries regardless of duty rate. They’re also exempt from the Section 301 forced-labor tariff. For high-volume importers, those exemptions alone can outweigh the compliance effort.
What happened to the Section 122 surcharge?
The 10% global import surcharge expired by operation of law at 12:01 a.m. Eastern on July 24, 2026, 150 days after taking effect. USMCA-qualifying goods were exempt throughout. A Section 301 forced-labor tariff took effect the same moment, at 10% or 12.5% across 60 economies. USMCA-qualifying goods from Canada and Mexico are exempt from it; non-qualifying goods from both pay 10%. It has no rate cap and no sunset, and it is being challenged at the Court of International Trade.
Do USMCA goods still need FDA clearance?
Yes. USMCA governs origin and duty treatment, not admissibility. All FDA-regulated goods from Canada or Mexico still need FDA clearance, and food still requires Prior Notice and, in most cases, an FSVP. See our guide to FDA import requirements.
Will the automotive rules of origin change?
Possibly. The U.S. has proposed raising the RVC threshold from 75% to 82% and requiring at least 50% of a vehicle’s value to be sourced in the United States. Nothing is finalized, and the U.S.-content demand has held up the fourth U.S.-Mexico negotiating round, which Mexico now expects before the end of 2026.
Can Jade International help with USMCA compliance?
On the customs side, yes. Our licensed brokers classify your goods, transmit the preference claim you certify, screen your HTS list against new tariff actions like the Section 338 lists, advise on FTZ and bonded admission status, and file protests where duties may be recoverable. Determining whether a good meets its rule of origin is the importer’s responsibility under USMCA, and it depends on bill-of-materials and supplier data that sits with you. We will tell you what is visible from the entry file and where you will need your supplier to answer. Contact us for a consultation.
