Get tougher with Canada on USMCA, senators urge

WASHINGTON - A pair of senior U.S. senators is urging the Biden administration to get tough with Canada for "flouting" obligations to its North American trade partners.

Democrat Sen. Ron Wyden of Oregon and Republican Sen. Mike Crapo lay out their concerns in a letter to U.S. Trade Representative Katherine Tai.

The letter says American dairy producers still aren't getting the access to the Canadian market they're entitled to under the U.S.-Mexico-Canada Agreement.

It also describes Canada's planned digital services tax as discriminatory and raises similar concerns about new legislation to regulate online streaming and news.

All three, the senators say, would give preferential treatment to Canadian content and deny U.S. tech companies fair access to the market north of the border.

The letter comes after meetings this week in San Diego between U.S., Canadian and Mexican trade emissaries, as well as the North American Leaders' Summit in Mexico City earlier this month.

The USMCA, referred to in Canada as CUSMA, has been at the centre of a number of bilateral and trilateral disputes since it went into effect in the summer of 2020.

"Three years later, it is disappointing that Canada and Mexico have failed to come into full compliance with the agreement — and, in some cases, have flouted their obligations," the senators write.

"USTR must take decisive action to ensure full compliance with the agreement and with dispute settlement panel findings. It is critical to ensure that every chapter of USMCA is fully and timely enforced."

Canada and Mexico have their own issues with how the U.S. is interpreting the deal, which was signed in 2018 after protracted trilateral efforts to replace NAFTA.

As the Mexico City summit wrapped up, a dispute panel ruled against the U.S. over how it interprets the rules that determine the origin of core automotive components.

It remains unclear whether the U.S. plans to comply with that decision.