Trade & Tariff Resource Centre

We would like to provide an update on new U.S. trade measures announced this afternoon. Late today, President Trump signed three proclamations under Section 338 of the U.S. Tariff Act of 1930, imposing new 50 percent tariffs on a broad range of Canadian goods. The measures are being introduced in response to Canada's treatment of U.S. motor vehicles, alcoholic beverages, and dairy products, and are scheduled to take effect on August 19, 2026.

The U.S. decision to move away from automatically extending CUSMA and instead require annual reviews has introduced a new layer of uncertainty into North American trade relations.

Key developments:

• The United States has opted not to proceed with a 16-year extension of CUSMA at this stage, instead triggering a framework of ongoing annual reviews of the agreement.
• In response, the Canadian government is actively seeking clarity on how the revised review process will operate and what it means for future negotiations.
• Despite the change in posture, CUSMA remains fully in force and is scheduled to remain active until 2036, unless otherwise renegotiated.

Implications and considerations:

• The shift increases policy and trade uncertainty, particularly around long-term investment planning and cross-border supply chains.
• Key areas of sensitivity include rules of origin, automotive production, steel and aluminum trade, and digital trade measures, which have been recurring points of tension.
• While tariff-free access for most goods remains intact under the current agreement, the new review structure could create more frequent leverage points for renegotiation or dispute.

Canadian position:

• Canada continues to emphasize the importance of stability, predictability, and trilateral cooperation within the agreement.
• Officials are maintaining engagement with U.S. and Mexican counterparts to better define how the review mechanism will be applied in practice.

Bottom line:
CUSMA is not being terminated, but the shift to annual reviews signals a more fluid and potentially more contentious trade environment going forward, with increased emphasis on ongoing negotiation rather than long-term certainty.

• U.S. importers that paid the tariffs
• Customs brokers acting on behalf of the importer

• It acted as the importer of record into the U.S. (for example, through a U.S. entity or subsidiary), or
• It has a commercial agreement where a U.S. importer passes through the refund

• Canadian exporters without importer of record status cannot apply directly
• Consumers and downstream businesses are not eligible

• Companies, or their U.S. affiliates, that imported coffee into the U.S. and paid tariffs directly may be eligible
• Where a U.S. distributor acted as importer of record, that entity must file the claim, not the Canadian exporter