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U.S. Government Plows Ahead on Canadian USMCA Compliance

February 1, 2023

NMPF lauded the administration’s Jan. 31 announcement that the U.S. had requested a second U.S. Mexico Canada Agreement (USMCA) panel to evaluate Canada’s compliance with its USMCA dairy market access obligations. The decision pushes forward the dispute settlement process, slightly more than a month after the U.S. requested consultations with Canada on an expanded set of USMCA dairy tariff-rate quota (TRQ) commitment violations.

Since USMCA’s implementation, Canada has continually flouted the agreement’s TRQ provisions, giving preferential treatment to Canadian processors at the expense of American dairy exporters and Canadian consumers. When this breach was initially confirmed by the first USMCA dispute panel, Canada responded by making only insignificant changes to its TRQ policies. This latest move challenges the persistent problems remaining in Canada’s dairy TRQ system.

NMPF and USDEC have worked closely with the U.S. Trade Representative and USDA throughout the dispute to support their case and demonstrate Canada’s lack of compliance with its USMCA commitments.