Newly assembled autos are parked on the Toyota Motor Manufacturing plant in Baja California, Tijuana, Mexico Could 31, 2019. REUTERS/Jorge Duenes
August 21, 2021
By Sharay Angulo
MEXICO CITY (Reuters) – Mexico sought formal session with the US on Friday over the interpretation and software of harder content material guidelines for vehicles set out within the USMCA commerce pact.
In Could, Mexico voiced disagreement over the problem in a three-way on-line digital assembly when it cited variations with the US strategies. Canada and Mexico use extra versatile interpretations.
“Mexico has recognized a divergent place between our governments on the interpretation of … provisions on guidelines of origin for the automotive sector,” Economic system Minister Tatiana Clouthier stated in a letter.
In her letter on Friday to U.S. Commerce Consultant Katherine Tai, Clouthier stated Mexico needed to keep away from or resolve a potential dispute.
The US-Mexico-Canada Settlement (USMCA), the successor to the North American Free Commerce Settlement (NAFTA), requires 75% North American content material for a car to be thought of as being from North America.
The identical share will apply for so-called important components from July 1, 2023, up from 69% now, and in comparison with 62.5% beneath the earlier commerce pact.
However as soon as the extent of important components hits 75%, it’s thought of 100% and ought to be counted as such in the direction of the general worth of the auto, Mexico says.
Its request for session is the primary non-contentious stage of a dispute decision mechanism supplied for in Chapter 31 of the pact, with an trade professional saying such talks have to be held inside 30 days, on this case by Sept. 20.
The US is reviewing the request, stated U.S. Commerce Consultant spokesman Adam Hodge.
“We’re reviewing Mexico’s request for consultations and stay dedicated to completely implementing the USMCA, together with the robust auto regional content material necessities to which all of us agreed,” he stated.
(Reporting by Sharay Angulo; Extra reporting by Andrea Shalal; Enhancing by Clarence Fernandez)