Canada approves USMCA trade deal.

pexels-photo-374870

Photo by Burst on Pexels.com

While the US is focused on the Corona Virus (COVID-19), on Friday, Canada formally approved the United States-Mexico-Canada Agreement (USMCA), the last nation needed to implement the deal to replace the 25-year-old North American Free Trade Agreement (NAFTA).

The trade deal was ratified by the Mexican legislature last June, the US legislature this past January and formally ratified by Canada on Friday. The Canadian parliament is now shut down for five weeks in response to the coronavirus pandemic.

Contact experienced trade attorney David Hsu by phone/text at 832-896-6288 or by email at attorney.dave@yahoo.com, dh@gjatradelaw.com if you have any questions about how the new USMCA will impact you and your business!

Japan-US Trade Pact in effect starting January 1, 2020.

Japan - Fuji

Mt. Fuji in the background, source: Jane Chang

The Japan-U.S. trade agreement started in April 2019, and starting January 1st, comes into effect, resulting in an immediate cut in tariffs on American farm products and a variety of Japanese industrial goods. Unfortunately, the trade agreement does not include passenger cars and auto parts. In addition to a trade agreement, the US and Japan reached an agreement on digital trade. As the US pulled out of the Trans-Pacific Partnership, this trade agreement was crucial for continued US/Japan trade.

Some terms of the trade deal include a reduction in import duty of US beef from 38.5% to 26.6%, with the ultimate duty rate of 9% in 2033. Other duties on cheese, wine, pork will eventually reach zero. In return, US duties on Japanese air conditioner parts and fuel cells were also removed as part of the deal.

While this current trade deal does not address import duties on cars and parts from Japan, second round talks with Washington (set for April 2020) may result in a trade deal. But the United States maintains import duties on cars and auto parts from Japan, despite strong calls for their abolition by the Japanese side.

We have been keeping up with this new trade deal, if you are wondering how it may impact your business, give us a call or text at 832-896-6288 or send us an email to David Hsu at attorney.dave@yahoo.com or work official email: dh@gjatradelaw.com.

US – UK trade deal by end of the year?

pexels-photo-1906879

Photo by Alessio Cesario on Pexels.com

With the UK set to formally leave the EU at 11:00 pm next Friday, January 31st, both the US and the UK have expressed strong interest in forming their own trade deal expected to be reached by the end of the year.

The goal at the end of the year reflects a comment by US Treasury Secretary Mr. Mnuchin in December 31 stating he wanted an “aggressive timeline” and that “It’s an absolute priority of President Trump and we expect to complete that within this year.”

Besides the US, it is expected that the UK seek trade deals with world wide and even the EU. EU negotiator Michel Barnier mentioned that “We are looking at a possibility of a relationship in the trade side where we will have zero tariffs and zero quotas between the EU and UK.” This would be the first for any non EU party and would allow access to the 450 million people under the EU umbrella.

Senate passes USMCA, heads to Trump’s desk.

Donald_Trump_official_portrait

Official portrait of President Donald J. Trump, Friday, October 6, 2017. (Official White House photo by Shealah Craighead)

After passing through the House, the Senate just passed the USMCA trade deal by 89-10 vote. The new trade deal will now head to Trump’s desk for his signature.

Contact experienced trade attorney David Hsu if you have any questions on how the new trade deal will impact your business, phone/text 832-896-6288 or email attorney.dave@yahoo.com, dh@gjatradelaw.com.

Treasury Department no longer designates China a currency manipulator.

full frame shot of eye

Photo by Vladislav Reshetnyak on Pexels.com

Two days prior to signing Phase One of the US/China trade deal, the Treasury Department announced they were removing China’s designation as a currency manipulator.

The Trump administration designated China as a currency manipulator in August 2019 when Trump accused China of intentionally weakening their currency to make their goods cheaper for sale overseas in light of the then-new tariffs.

Since August, the Treasury Department claims China has made promises to stop devaluation and to promote transparency and accountability.

While the August 2019 label as a currency manipulator received bipartisan agreement, this new move has received criticism from Democrat Senators who argue the label of “currency manipulator” should not be used as a bargaining tool in the ongoing US/China trade war.

As the signing date of Phase One approaches, I expect the Trump administration to release further details in multiple parts.

Feel free to contact David Hsu directly by phone/text at 832-896-6288 to discuss your China, trade and import/export related issues or send an email to attorney.dave@yahoo.com, dh@gjatradelaw.com

US China set to sign a trade deal on Wednesday.

birds eye view photo of freight containers

Photo by Tom Fisk on Pexels.com

On January 15th, the US and China are expected to sign phase one of the new trade deal between the two nations. The deal is 86 pages long and the full content has not yet been released.

According to Barron’s, citing a former Trump administration trade negotiator, the deal will cover 5 areas:

1.  Commitment from China to stop forced technology transfers.

2. Process for China to create judicial proceedings to enforce trade law secrets, patent extensions for US pharmaceuticals.

3. No further currency manipulation

4. Commitment by China to buy more agricultural products.

5. Use science-based risk assessment when determining whether to ban US imports.

Will post more details as soon as they are confirmed. If you have any questions about the trade deal or general import and export questions, contact David Hsu by phone/text at 832-896-6288 or by email at attorney.dave@yahoo.com, dh@gjatradelaw.com.

US China Trade Deal as of 12/13/2019.

Donald_Trump_official_portrait

Official portrait of President Donald J. Trump, Friday, October 6, 2017. (Official White House photo by Shealah Craighead)

As you are aware, the Trump administration has confirmed a trade deal with China has been reached.

Phase one of the trade deal was just announced:

-List 1 remains at 25%

-List 2 remains at 25%

-List 3 remains at 25%

-List 4b is gone (4b was initially scheduled to take effect December 15th, and included consumer electronics such as cell phones, laptops, computers, etc.).

-“Most” (not all) of List 4a is going to drop to 7.5%.

We will monitor the Federal Register for what specifically is being reduced. If you have any further questions, contact experienced trade attorney David Hsu for immediate help by phone/text at 832-896-6288 or by email at attorney.dave@yahoo.com, dh@gjatradelaw.com.

U.S. House passes USMCA, next stop the Senate.

flag of canada

Photo by Social Soup Social Media on Pexels.com

As you are aware, the U.S. House of Representatives passed an updated version of the USMCA earlier this week. The passage by the House includes revisions to an agreement initially agreed to by the US, Mexico and Canada in September 2018.

The next step for the USMCA is the Senate, where it is not expected to be put to a vote until 2020.

What are some of the changes in the USMCA versus NAFTA?

  • If autos are to qualify for no tariffs, then 75% of the components must be manufactured in Canada, Mexico or the United States (currently at 62.5%).
  • 30% of the work on the vehicle must be performed by individuals making $16 or more per hour, with a 40% requirement in 2023.
  • The new agreement allows works in Mexico to unionize.
  • The definition of steel and aluminum for Mexico in regards to the automotive rules of origin includes “melted and poured” in North America.
  • USMCA will be subject to mandatory review every 6 years, if all parties agree, then there is a 16 year period for review, with subsequent reviews every 16 years.

If you have any further questions how your business may be impacted by the USMCA if and when it is passed next year, contact experienced trade attorney David Hsu by phone/text at 832-896-6288 or by email at attorney.dave@yahoo.com or dh@gjatradelaw.com.

India says they will not join the largest free trade deal – the Regional Comprehensive Economic Partnership (RCEP).

photo of woman standing on balcony

Photo by Abhishek Saini on Pexels.com

Yesterday, India’s Prime Minister, Narendra Modi announced India would not join the Regional Comprehensive Economic Partnership (RCEP).

The RSCEP is a proposed trade deal among 16 countries and has been discussed for the past 7 years and the subject of over 28 rounds of discussion. The RCEP was believed to be the “largest trade deal” because both China and India were expected to participate. China, India and 14-other nations in the RCEP would account for 40% of the world’s GDP.

In a public statement, the government of India cited several reasons to withdraw from the RCEP: (1) India wanted stronger wording on rules of origin, (2) change in the base year for the reduction of duties to be 2019 instead of 2014 and (3) for companies investing in India to procure a certain percentage of local input materials.

The remaining 15 countries have vowed to continue efforts to pass the RCEP with India’s involvement.

Do you have any general trade or customs law questions? Contact David Hsu by phone/text at 832-896-6288 or by email at attorney.dave@yahoo.com, dh@gjatradelaw.com.

China leading the way for new trade deal with ASEAN nations.

ancient architecture art asia

Photo by icon0.com on Pexels.com

This week, the 10 members of the Association of Southeast Asian Nations (ASEAN) are meeting in Bangkok, Thailand and one main focus will be the creation of a free-trade pact that will cover 50% of the world’s population and 40% of the world’s commerce. The ASEAN nations hope to enact the Regional Comprehensive Economic Partnership (RCEP), a trade deal that covers a territory from India to New Zealand.
In negotiation for the past few years, the current US China trade war is pushing the effort to create the RCEP. Will post any updates as available.
Do you have any trade or customs law questions, contact your trade and customs attorney David Hsu by phone/text at 832-896-6288 or by email at attorney.dave@yahoo.com, dh@gjatradelaw.com.