NAFTA to CUSMA – Canada keeps the change only to the name

NAFTA to CUSMA

Here’s a news related to Canada immigration for which you will need to know some basics about certain terms that are important to immigration affairs between Canada and the US.

NAFTA

The North American Free Trade Agreement (NAFTA) is an agreement that was brought into effect to promote trade relations between the US, Canada, and Mexico. The agreement removed most of the tariffs on trade between these 3 countries. The benefits of NAFTA went to many industries, particularly automobiles, textiles, and agriculture. Many tariffs related to these industries were discontinued gradually between January 1, 1994, and January 1, 2008.

CUSMA

The Canada-United States-Mexico Agreement (CUSMA) was created on July 1, 2020, is a new agreement that follows its predecessor NAFTA. It aims at preserving important elements helping to maintain and promote trading relations between the 3 countries: the US, Canada, and Mexico. The agreement has formed a strong foundation for Canada’s prosperity by benefitting from the virtues of liberalization of trade between nations.

LMIA

A Labor Market Impact Assessment (LMIA) is a certain document that an employer in Canada may need to procure before hiring a foreign worker. It basically establishes the need for the employer to look for foreign workers, willing to work in Canada, to fill job vacancies as there is no Canadian native or permanent resident available to man the job position. A positive LMIA is also called a confirmation letter.

The big news!

Even after the CUSMA coming into force from July 1, 2020, the rules on the temporary entry for business people underwent no change. The Immigration, Refugees and Citizenship Canada (IRCC) has confirmed that CUSMA treats LMIA and exemptions on work permits just like how NAFTA did. This is practically just a matter of name change.

With CUSMA a reality now, US President Donald Trump has fulfilled his election promise to renegotiate NAFTA.

From the perspective of Canada immigration, CUSMA has not made any difference. But it definitely has affected significant areas like:

  • Environment
  • Dispute settlement
  • Copyright, digital trade, e-commerce
  • Labor rights
  • Dairy, chicken, and eggs
  • Automobiles

The provisions related to immigration in Canada are covered under the IMP (International Mobility Program). So, business people who are citizens of Mexico and the US are given exemption from the requirements of LMIA while entering Canada. This is applicable when they are arriving in Canada for activities related to trade of goods or services, or making investments.

This will be reciprocated in the same way for Canadians who enter the other 2 countries for the same purpose.

4 categories of business people are created by CUSMA. They are:

  • Traders and investors
  • Intra-company transferees
  • Professionals
  • Business visitors

Even under CUSMA, the terms related to intra-company transferees will remain the same. Intra-company transferees involve employees, executives, or managers with specialized knowledge coming from Mexican or US companies who are transferred to Canadian business that is linked to these companies.

Such intra-company transferees are exempt from LMIA though they need a work permit. So is the case with traders and investors.

If you are looking to Study, Work, Visit, Invest or Migrate to Canada, talk to Y-Axis, the World’s No.1 Immigration & Visa Company.

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Anshul Singhal

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