Is your company interested in exporting or expanding your exports? If you said yes, you’re in luck. The United States-Mexico-Canada Agreement (USMCA) went into effect on July 1, 2020.
The USMCA specifically recognizes the fundamental role small businesses play in the North American economy. This is the first time that a U.S. Federal Trade Agreement has included a stand-alone chapter on small and medium-sized enterprises (SMEs). This chapter launches a new framework for ongoing small business dialogue and participation. With the establishment of information sharing tools and the help of a multinational, governmental based committee focused on SME issues, opportunities will continue to grow for small businesses.
Small business benefits don’t end with the USMCA chapter on small and medium-sized enterprises.
The USMCA also:
- Cuts the red tape for lower-value shipments (under $2,500) and increases de minimis levels for exports to Mexico and Canada, making it easier for small businesses to engage in cross-border trade.
- Reduces costs by making cross-border transactions easier and more predictable. The scope of advanced rulings by customs authorities is expanded along with an online searchable database for customs information and the expedited release of express shipments.
- Prohibits customs duties on products distributed electronically. This supports internet-enabled small businesses and e-commerce exports.
- Improves the protection of intellectual property (IP) rights by reducing the rules and regulations required and streamlining application procedures that impose undue burdens on small businesses.
- Eliminates the requirement to open a foreign office as a condition of doing business and encourages countries to avoid authorization procedures that impose excessive burdens on small businesses.
- Reduces or eliminates unnecessarily burdensome, duplicative, or divergent requirements placed upon small businesses when countries create new regulations.
You can learn more about the United States-Mexico-Canada Agreement (USMCA) from the Office of the United States Trade Representative (USTR).
Whether you are currently exporting or just thinking about it, the Export-Import Bank of the United States (EXIM) has export finance solutions to increase your company’s international sales. EXIM’s product line is designed to minimize your company’s risk of foreign buyer nonpayment when selling on open account credit terms and to provide access to vital working capital.