A recent report from the Government Accountability Office finds that USTR should improve interagency coordination efforts to implement, verify, and enforce the new automotive rules of origin under the United States-Mexico-Canada Agreement. USTR said that it looks forward to implementing the GAO’s recommendations.

The report examined the mechanisms used by U.S. agencies to coordinate on the new rules of origin and the extent to which relevant agencies are effectively coordinating the implementation, enforcement, and verification of the new rules and customs procedures. As part of this process, the GAO reviewed legislation and documents, interviewed agency and labor and industry stakeholders, and analyzed responses from nine agencies that participate on the Interagency Autos Committee against leading interagency collaboration practices.

The GAO found that in its efforts to coordinate on the implementation, enforcement, and verification of the new automotive rules of origin the Interagency Autos Committee generally followed six of the eight leading collaboration practices, as identified in the GAO’s prior work. However, the committee partially followed two other practices. For example, it has not developed clearly articulated written guidance, which could improve communication, limit uncertainty for agencies and stakeholders, and aid in the monitoring of progress toward committee outcomes.

The GAO further found that U.S. Customs and Border Protection and the Department of Labor have generally followed all eight of the leading collaboration practices during their implementation of the labor value content certification process and planning for LVC verifications. Their LVC guidance details the agencies’ roles and responsibilities, as well as other leading collaboration practices, for these two processes. In addition, the GAO found that no significant interagency coordination takes place for enforcement of the new rules of origin because CBP alone conducts those activities. According to officials, CBP has not yet enforced some of the requirements because the final set of rules of origin regulations are awaiting approval.

In light of these findings, the GAO is recommending that USTR, as chair of the Interagency Autos Committee, work with committee members to develop written guidance that helps ensure accountability and reflects other leading collaboration practices, as appropriate. The guidance should include defining how the committee tracks, monitors, and communicates progress towards outcomes, such as providing recommendations for future modifications to the USMCA rules of origin.

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