Following the May 18, 2017 notification to Congress of the Trump Administration's intent to renegotiate the North American Free Trade Agreement (NAFTA), US Trade Representative (USTR) Robert Lighthizer published a notice in the May 23, 2017 Federal Register seeking public input into the development of US negotiating objectives and positions. 82 Fed. Reg. 23,699. Comments are due by June 12, 2017, and a public hearing is set for June 27, 2017. Comments and requests to testify orally at the hearing may be submitted at www.regulations.gov, using the docket number USTR-2017-0006.

Comments on "any matter relevant to the modernization of NAFTA" are invited. In particular, comments are invited on specific items. Notably, the list is significantly longer than the list of "new" provisions contained in the May 18 Congressional notification letter. The list includes:

— General and product-specific negotiation objectives
— Economic costs and benefits of removing remaining tariff and non-tariff barriers
— Treatment of specific goods
— Customs and trade facilitation issues
— Rules of origin and origin procedures
— Unwarranted sanitary and phytosanitary measures and technical barriers to trade imposed by Canada or Mexico
— Barriers to trade in services
— Digital trade issues
— Intellectual property issues
— Competition-related matters
— Government procurement
— Environmental issues
— Labor issues
— Issues of particular relevance to small and medium-sized businesses
— Trade remedies
— State-owned enterprises

Comments will be open to public inspection, with the exception of information that is properly marked as business confidential.

Actions for businesses

Businesses trading within North America will want to use this window of opportunity to express their points of view on whether specific changes to NAFTA would be beneficial, problematic or acceptable. Input can be provided throughout the process, but the input provided during the development of negotiating positions could have the most impact. As part of the TPA process, for example, the USTR will release more detailed negotiation objectives 30 days before negotiations begin. This in turn drives the very short timeframe for public comments specified in the May 23 Federal Register notice.

Understanding the effect of possible changes will allow a business to develop a strategy to "preserve or improve" current treatment. With this understood, businesses can plan how best to communicate with any or all of the three NAFTA counties, keeping in mind the negotiating objectives of each. For details on the approach to assessing a company's NAFTA profile, see Tax Alert 2017-820.

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