This blog series provides Baker McKenzie’s insights and strategic advice on the 2026 USMCA review, including how businesses should prepare for changes to this trilateral agreement. Baker McKenzie’s North American customs team includes trade professionals, attorneys and economists in Canada, the US and Mexico. We have a reputation for delivering strategic and practical advice to optimize supply chains under the USMCA, foster compliance, and address commercial concerns arising from Chapter 31 disputes.
A trilateral agreement has been the bedrock of North American trade for over three decades. After a US-led effort to review the NAFTA arguing that it no longer reflected the economic realities of the trading partners, the agreement was re-born, the USMCA/T-MEC/CUSMCA and remains one of the largest global trading blocs, representing almost 20% of global GDP. In 2025, trilateral trade in goods between Canada, the United States, and Mexico is estimated to be in the range of USD 1.7–1.9 trillion. In 2026, the USMCA is up for a ‘joint review’, which will largely determine its immediate and longer term future (2026 Review).
Given the continued US perception of trade imbalances with Canada and Mexico, interpretive issues precipitating Chapter 31 dispute resolution, unilateral tariff action by the US (including in the face of 232 side letters), the outcome of the 2026 Review is uncertain. While the US may be posturing a renegotiation and not a review, Canada and Mexico are poised to address historical frictions as implementation shortcomings and not structural flaws of the text of the agreement. The following outcomes remain possible: (1) expiration in 2036; (2) a revised USMCA, renewed until at least 2042; or (3) unilateral withdrawal outside the terms of the agreement.
Review Timeline
Article 34.7 obligates the Parties to undertake a mandatory “joint review” every six years. While sometimes referred to as a “sunset clause”, it is review and extend provision, the first of its kind in a US FTA, while Mexico and Canada have similar reviews under the Trans-Pacific Partnership. The USMCA entered into force on July 1, 2020, for a 16-year term. July 2026 marks six years since the USMCA entered into force, triggering the first joint review. While the text of the USMCA provides certain parameters and domestic implementing legislation may provide specific actions, there is no precedent for this review process.
The USMCA obligates the Parties to meet in July 2026 to review the USMCA. Practically speaking, the review has been underway since Parties launched consultations and hearings, canvassing the general public for their views on the operation of the USMCA to date.
Come July, we expect that the Parties will convene for a more formal review process (i.e. a series of meetings/negotiations) to discuss revisions to the text of the agreement and the possibility of side letters to resolve ongoing bilateral tariff disputes (i.e. US tariffs on Canadian origin goods and s. 232 tariffs impacting Canadian and Mexican origin goods). Mexico and Canada may cautiously approach the issue of s. 232 measures and extracting guarantees using side letters given the US decision to ignore existing side letters determining the application of s. 232 tariffs for Canadian origin steel/aluminum.
Should a party fail to extend the USCMA during the 2026 Review, the Parties will be required to conduct annual reviews until all parties agree to extend the USMCA for another 16-year period (triggering a new six-year review process) or until its termination in 2036. Article 34.6 covers unilateral withdrawal, provided that the withdrawing party provides notice (six months) to the remaining Parties.
Consultations and ongoing domestic review processes
All Parties have launched consultation processes to canvass the public on the operation of the USMCA:
US: On September 17, 2025, the US Trade Representative (USTR) published a Federal Register notice launching public consultations (closed November 3, 2025) and a public hearing (December 3-5 2025) seeking testimony from industry, unions and the general public at large. On December 5, 2025 (closed January 7, 2026), the USTR launched public consultations targeted on trade in automotive goods to assist with a report due July 1, 2026 to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives. On December 17, 2025, the US Trade Representative reported to the House Ways and Means and Senate Finance Committees, advising that the USTR received 1,541 comments during its consultation, many calling for the USMCA to be extended, but with “improvements”. This report served as the statutorily required congressional notification and assessment of the USMCA.
Canada: The House of Commons Standing Committee on International Trade (CIIT) commenced a study of the USMCA in 2024. In fall 2025, CIIT held public hearings to hear from business groups, think tanks, and experts. The CIIT’s review remains ongoing. Global Affairs Canada launched public consultations on September 20 (closed November 3, 2025). While the official consultation is now closed, GAC continues to accept submissions. Submissions remain confidential at this time.
Mexico: On September 17, 2025, Mexico’s Ministry of the Economy launched consultations (closed November 16, 2025). Submissions remain confidential at this time.
How North American businesses can prepare for July 2026
North American businesses with USMCA reliant supply-chains should consider the following proactive steps to prepare for the lead up and outcome to the July 2026 Review meetings.
- Engage with domestic and North American industry associations and/or chambers of commerce to understand their key positions and lobbying efforts. Be mindful that member interests can diverge, which may constrain official submissions on the operational benefits/disadvantages of the USMCA. For example, an industry association may include resellers of a widget manufactured in different countries and domestic manufacturers of the same widget. While one member may benefit from duty free access to USMCA widgets, the rules of origin for the same widget may have perceived shortcomings.
- Follow, or continue to follow, internal government processes in your home jurisdiction(s).
- Watch for announcements on the official format of the review and the official positions of each Party.
- Coordinate high-level risk management reviews of your supply chain to determine the impact of a loss of USMCA preferential tariff treatment should origin rules be amended.
