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USMCA – de minimus increase

With the USMCA now in effect, many North American businesses are presented with a need to
change the way they conduct international business.  One of the changes introduced by the USMCA is an
increase in de minimis, involving the origins of inputs for products within the North American market.
NAFTA, the former North American agreement, held a de minimis of 7% but the USMCA has increased
that amount to 10%.  This threshold means that no more than 10% of either the total costs of the good or
the transaction value for the good can be made of non-North American inputs.  This 3% increase of de
minimis with USMCA entails a series of regulations but advantages.  Borderless Coverage helps clients
to comply with as well as capitalize on these changes.

Borderless Coverage is able to cater a less complicated processing procedure at customs with
goods that comply with the new de minimis provisions.  These compliant goods are less likely to be held
at customs and instead are due to arrive at their destination in a timelier fashion.  The Office of the United
States Trade Representatives recognizes this opportunity as a significant factor in the efficiency of supply
chains for small and medium sized enterprises, or SMEs, in the United States.  These new terms also
entail eased access into Mexico’s and Canada’s markets as a result of the lower production and delivery
costs.  Borderless Coverage’s team of international supply chain experts, consultants, and contract
negotiators utilize these de minimis provisions to not only check compliance with the USMCA but also
facilitate a more seamless international trade process for companies looking to enter the dynamic North
American market.