Dear NAFTZ Member and Advocates,
NAFTZ is fighting to make sure that a harmful, anti-FTZ provision from the old NAFTA trade agreement is not slipped back into the new U.S.-Mexico-Canada Agreement (USMCA) through a legislative maneuver known as a “technical correction.” We need your help to win this fight.
As many of you know, the bill to implement the original 1993 NAFTA included a restriction on manufacturing companies located in U.S. FTZ that prevented those companies’ products from qualifying for NAFTA preferential treatment when entered into the commerce of the United States. Under this restriction, a U.S.-based FTZ manufacturer making a product for U.S. consumption that complied with the NAFTA rules of origin was nonetheless required to pay U.S. duty on any non-NAFTA components. But the rules allow manufacturers in Canada and Mexico to ship to the U.S. duty free.
During the many months of NAFTA renegotiation and subsequent enactment of USMCA’s implementing legislation, NAFTZ repeatedly testified and argued for this harmful restriction to be repealed. Many NAFTZ members – grantees, operator/users and service providers – joined us in that effort. And ultimately, we succeeded. The USMCA bill that was signed into law earlier this year repealed all the old NAFTA bill, and no comparable provision was included in the new law.
Now, however, the Office of the United States Trade Representative (USTR) is trying to re-impose this restriction by inserting a similar provision in what is known as a “technical corrections” bill. USTR evidently claims that it was an oversight when they did not ask Congress to include the restriction in the USMCA bill.
We believe that without the harmful NAFTA restriction, the new USMCA can provide FTZ-based manufacturing firms with new opportunities to succeed throughout the nation. Now we need to convince members of the United States Senate and House of Representatives to stand up to USTR’s pressure and keep the FTZ Rules-of-Origin provision out of the technical corrections bill.
On August 31, NAFTZ sent a letter to the Chairmen and Ranking Minority Members of the Senate Finance Committee and the House Ways and Means Committee. They are the leaders who will decide who will win this fight. Will it be FTZs, or USTR? Now, as Congress prepares to return for a short September work session, we need to convince more Senators and Representatives to side with us and tell these leaders to do the right thing for FTZs and U.S. manufacturing.
Please join us in this effort. Please take a few moments and reach out to your own two U.S. Senators and your local Congressman or Congresswoman, and ask them to let the Senate Finance or House Ways and Means leaders know that they support FTZs and oppose USTR’s technical correction. Your participation can make a real difference.
On behalf of the NAFTZ Board of Directors, thank you for supporting FTZs in this very important effort.