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Richard Mojica Quoted on Foreign Trade Zone Treatment Under the USMCA in Inside U.S. Trade

Subtitle
"Companies Operating in Foreign Trade Zones to Gain Preferential Treatment Under USMCA"

Inside U.S. Trade

Richard Mojica was quoted on the preferential treatment benefit for U.S. manufacturers operating in U.S foreign trade zones under the U.S.-Mexico-Canada Agreement (USMCA). Under NAFTA, U.S. manufacturers operating in U.S foreign trade zones were prohibited from receiving preferential treatment. Mojica said the NAFTA provision, which will not be included in the USMCA, put U.S. companies "at a disadvantage" because Canada and Mexico have no such restrictions. Since 2017, the National Association of Foreign Trade Zones (NAFTZ) has called for the elimination of the provision claiming it hinders U.S. companies from competing with Canada and Mexico. Mojica believes the provision "was purposely kept out of the USMCA's implementing legislation in response to NAFTZ's efforts to have it removed." He stated, "NAFTZ’s argument that this language disadvantages U.S. manufacturers probably resonated strongly. Therefore, I do not think that the language will be reintroduced."