On July 1, 2020,  the US Department of Labor published in the Federal Register an interim final rule (IFR) issuing regulations necessary to administer the high-wage components of the labor value content requirements as set forth in section 202A of that United States-Mexico-Canada Agreement Implementation Act (the “Act”).  The interim final rule is effective on July 1, 2020. Interested persons are invited to submit written comments by August 31, 2020.

The Act requires that to receive preferential tariff treatment, a producer of a covered vehicle must file a certification that the production of the covered vehicle meets the high-wage components of the labor value content (LVC) requirements. The Act authorizes the Secretary of Labor (“Secretary”), in consultation with the Commissioner of US Customs and Border Protection (CBP), to check the certification for omissions or errors and to verify whether a covered vehicle is in compliance with the high-wage components of the LVC requirements. This IFR implements the Act’s requirements and establishes procedures for producers to follow concerning the high-wage components of the LVC requirements. Any entity seeking preferential tariff treatment when importing covered vehicles into the United States must comply with the Department’s regulations set forth in this IFR, including for plants located in Mexico and Canada that it uses to satisfy the high-wage components of the LVC requirements. In addition:

  • The IFR details what information the producer submits to CBP in its certification that the Department will review for omissions or errors and defines the scope of conducting verifications and the process by which the Secretary will conduct them.
  • The IFR explains producers’ recordkeeping responsibilities and the scope of the Secretary’s authority to inspect such records
  • The IFR also provides for an administrative review process of the Department’s analysis and findings concerning a producer’s compliance with the high-wage components of the LVC requirements.
  • The IFR also describes the Department’s whistleblower enforcement processes.

Questions of interpretation and/or enforcement of the agency’s regulations may be emailed to [email protected].