S. 2861: Protecting the USMCA from Harmful Chinese Investment Act

This bill, titled the "Protecting the USMCA from Harmful Chinese Investment Act," aims to enhance the review of foreign investments in the United States, Canada, and Mexico, particularly from nonmarket economy countries like China. Here are the key points of the bill:

Purpose of the Bill

The bill's main objective is to direct the United States Trade Representative to ensure that the review processes for foreign investments in the member countries of the United States-Mexico-Canada Agreement (USMCA) are aligned and robust enough to protect national security interests.

Support for North American Trade

• The United States, Canada, and Mexico have significant trade relations, with trade between them amounting to approximately $1 trillion.
• The USMCA is essential for maintaining strong economic ties and supply chains that support jobs in these countries.

National Security Considerations

• Given the close economic relationship among these three countries, it is important for each country to have strong mechanisms for reviewing foreign investments for potential national security risks.
• The bill emphasizes the need for Canada and Mexico to establish their own legislative and regulatory frameworks for this purpose, similar to the U.S. system managed by the Committee on Foreign Investment in the United States (CFIUS).

Objectives during Joint Reviews

During the first joint review under the USMCA after the bill is enacted, the Trade Representative will advocate for:

• All USMCA countries to implement effective frameworks for reviewing foreign investments.
• A system for these countries to coordinate on shared threats posed by investments from nonmarket economies.

Technical Assistance

The bill provides for the Trade Representative to collaborate with the Secretary of the Treasury and the Secretary of State to offer technical assistance to Canada and Mexico. This assistance may include:

• Expert advice to help establish foreign investment review frameworks.
• Training programs for officials in the USMCA countries.
• Financial support for setting up these frameworks.

Definitions

The bill clarifies several terms, including:

• Joint review: Refers to a collaborative examination of trade and investment policies under the USMCA.
• Nonmarket economy country: A term used for countries with economies that do not operate on free-market principles.
• Trade Representative: The official in charge of overseeing U.S. trade policy.
• USMCA: The trade agreement between the United States, Canada, and Mexico.

Relevant Companies

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