USMCA, Labor Attachés, Labor Law enforcement, Rapid Response Mechanism,

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USMCA developments and Mexico-China Business Forum – The Trading Room

20 Dec , 2019  

USMCA in a Week

A few days after the protocol amending USMCA was signed, a new controversy arose between Mexico and the USA at the weekend due to USMCA’s implementing act in the USA. 

In essence, Mexican negotiator, Jesus Seade, wrote a letter stating that Mexico considered that the legislation went “beyond” the protocol since the USA was considering to include “labor inspectors” in Mexico. 

In response, USTR mentioned that the USMCA’s authorized “domestic measures” such as having “Attachés”. In fact, US attachés currently operate in Mexico in different sectors or matters, such as agricultural, commerce, among others.  

How will the US Attachés function?

The existence of a maximum of 5 labor Attachés is planned, according to the USTR response and US legislation. The Attachés “will work with their Mexican counterparts, workers, and civil society groups on implementation of the Mexican labor reform, including by providing technical assistance and disbursing capacity building funds, and provide assistance to the new U.S. government interagency labor committee.” 

Undersecretary Seade thanked the “clarity” of USTR’s response, considered that the Attachées will be 90% harmless and pointed out that the Attachées would abide by Mexican law.

Rapid Response Mechanism

The Modification Protocol to USMCA provides for Facility-Specific Rapid Response Labor Mechanism, which will operate independently.

Our labor expert, Rafael Alday, prepared an alert (only available in Spanish), addressing this mechanism briefly.

Under this context, it is clear that Mexico will have comprehensive monitoring of compliance with labor laws, particularly on unions and collective bargaining rights. In the same vein, Ricardo Ramírez, a former member of the WTO Appellate Body, said that never before a system so intrusive and with strict surveillance of labor legislation in another country had been established.

A Strong First Step

On Tuesday, the USMCA implementation act was approved by the Committee on Ways and Means of the House of Representatives, meanwhile, the House approved the act yesterday. Now, the Senate needs to vote on the act, but this will occur after the impeachment process that US President Donald Trump is facing according to media outlets.

The Mexican Minister of Economy mentioned in Twitter that the US Senate will vote on January 2020.  

Sources:

https://ustr.gov/about-us/policy-offices/press-office/press-releases/2019/december/ustr-responds-mexico-usmca

https://www.eluniversal.com.mx/opinion/ricardo-ramirez-hernandez/t-mec-me-acabo-de-enterar

https://elfinanciero.com.mx/economia/camara-de-representantes-de-eu-ratifica-el-t-mec

 

Mexico-China Business Forum

This Monday, VTZ and Adrián Vázquez participated in the Mexico-China Economic and Commercial Cooperation Forum organized by the Mexican Business Council for Foreign Trade, Investment and Technology (acronym COMCE) and the Chinese Council for the Promotion of International Trade (CCPIT). Detailed information about the plenary is available here.

 

Sources:

https://www.jornada.com.mx/ultimas/economia/2019/12/16/abriran-oficina-de-enlace-entre-empresarios-chinos-y-mexicanos-4595.html

 

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