What GAO found
Government agencies used three primary mechanisms to coordinate the implementation, verification, and enforcement of the new U.S.-Mexico-Canada Agreement (USMCA) rules of origin for automotive supplies.
- The Interagency Motor Vehicle Committee, chaired by the Office of the United States Trade Representative (USTR), provides advice and oversight of the USMCA's provisions regarding motor vehicle supplies.
- The USMCA Center provided guidance to stakeholders and facilitated verification activities from its establishment in March 2020 until its closure in February 2023.
- Customs and Border Protection (CBP) and the Department of Labor (DOL) jointly developed guidance on the certification and verification process to ensure that a product's labor value content (LVC) meets requirements. , shared information.
GAO evaluated the effectiveness of continued adjustments to selected key collaboration practices identified in previous GAO work.
GAO’s Key Interagency Collaboration Practices
In its efforts to coordinate the implementation, enforcement, and verification of the new Automotive Origin Rules, the Interagency Automotive Committee generally adhered to six of the eight key collaborative practices identified in GAO's previous study. However, the committee partially followed two other of his practices. For example, the Commission did not develop written guidance to ensure accountability. Clearly articulated written guidance can improve communication, limit uncertainty for agencies and stakeholders, and help monitor progress toward the Commission's outcomes.
CBP and DOL generally follow all eight core collaboration practices while implementing the LVC certification process and planning LVC validation. Their LVC guidance details agency roles and responsibilities regarding these two processes, as well as other key collaboration practices. Additionally, GAO found that CBP is conducting these activities alone, resulting in a lack of significant interagency coordination regarding enforcement of the new rules of origin. Officials said CBP has not yet implemented some requirements as the final version of the rules of origin awaits approval.
Why GAO conducted this study
USMCA, which replaced the North American Free Trade Agreement, went into effect in July 2020. The changes were important because they tightened rules of origin for auto parts and could have far-reaching implications for trade, regulators and industry officials said. The USMCA Implementation Act includes provisions for GAO to review the effectiveness of coordination among U.S. government agencies regarding the implementation, enforcement, and verification of motor vehicle rules of origin and USMCA customs procedures for motor vehicle products.
In this report, GAO examines (1) what mechanisms U.S. government agencies are using to coordinate on new rules of origin; (2) the extent to which relevant agencies are effectively coordinating the implementation, enforcement, and verification of new regulations and customs procedures; GAO reviewed laws and documents, interviewed government agencies, labor, and industry stakeholders, and reviewed the Interagency Automotive Committee for key interagency cooperative practices identified in GAO's previous work. We analyzed responses from nine participating government agencies.
