There is a new Free Trade Agreement (FTA) in town, and it goes by the name of the Canada-United States-Mexico Agreement (CUSMA). This agreement replaces NAFTA, which was put into place back in 1994. The main difference between CUSMA and NAFTA is that CUSMA allows for more categories. In this article, we will explore four types of CUSMA categories: intra-company transfers, professionals, investors, and traders. Stay tuned for more information on this newly revamped FTA!
What is the Canada-United States-Mexico Agreement?
The Canada-United States-Mexico Agreement (CUSMA) is a newly renegotiated and revamped version of the North American Free Trade Agreement (NAFTA). CUSMA came into effect on July first, 2020. The agreement makes it easier for eligible citizens of the United States and Mexico to come work or conduct business in Canada.
Under CUSMA, there are four types of categories that allow for such mobility: intra-company transfers, professionals, investors, and traders. Let’s take a closer look at each one.
An intra-company transfer is when an employee of a company based in the United States or Mexico is transferred to a branch or subsidiary of that same company in Canada on a temporary basis. In order to be eligible for this type of transfer, the employee must have worked for the company for at least one continuous year prior to the transfer. The employee must also be coming to Canada to work in a managerial, executive, or specialized knowledge position.
For the professional category, you must have a pre-arranged job offer or a contract in one of the targeted professions in Canada. There are 63 professions total that is eligible under CUSMA. Some examples include engineers, accountants, and medical doctors. Certain professions require educational credentials and proof of experience in their field in order to be eligible. The work permits can be valid for up to three years and can be renewed an unlimited number of times, as long as the applicant continues to meet the eligibility requirements.
The investor category is for U.S. and Mexican citizens who are looking to invest in a new or existing Canadian business. If the investor is an employee, then they must be an executive, supervisory or have essential skills.
The trader category is for U.S. and Mexican citizens who are engaged in substantial trade in goods or services between Canada and the United States or Mexico. To be eligible, applicants must meet certain criteria set out by CUSMA, which include having a majority ownership stake in the trading company and conducting more than 50% of the company’s international trade with Canada.
The Benefits of Free Trade Agreements
Free trade agreements like CUSMA offer several benefits to businesses and workers in the United States, Mexico, and Canada. These benefits include:
Increased Access To Markets
Free trade agreements provide companies with increased access to foreign markets. This can lead to new opportunities for business growth and expansion.
Reduced Tariffs And Other Trade Barriers
Tariffs and other trade barriers, such as quotas, can be reduced or eliminated through free trade agreements. This makes it easier and cheaper for businesses to export goods and services to foreign markets.
Improved Labour Mobility
Free trade agreements can make it easier for workers to move between countries in order to take advantage of job opportunities. This can help businesses find the skilled workers they need in order to be successful.
Increased access to foreign markets can attract foreign investment using free trade agreements. This can lead to new jobs and economic growth in the United States, Mexico, and Canada.
Want To Know More About CUSMA?
If you want more information on the Canada-United States-Mexico Agreement, you can visit the Government of Canada’s website. The website includes information on the agreement, like the latest news, investing in Canada with CUSMA, and more.
CUSMA is a great opportunity for those who are looking to work or invest in Canada. If you think you might be eligible, we encourage you to take a closer look at the agreement and see if it’s right for you.