Canada-United States-Mexico Agreement (CUSMA)

The Canada-United States-Mexico Agreement (CUSMA) is a trade agreement among Canada, the United States and Mexico. It replaced the North American Free Trade Agreement (NAFTA) on July 1, 2020, as confirmed in Treasury Board Contracting Policy Notice 2020-2. The agreement was signed on November 30, 2018.

CUSMA sets rules in areas such as labour, customs and market access. For Canadian suppliers, the key point is that Canada is not a party to CUSMA's government-procurement chapter. That chapter applies only between the United States and Mexico, so CUSMA does not give Canadian firms bid rights in the way NAFTA once did.

What CUSMA replaced and when it took effect

CUSMA was signed on November 30, 2018, and entered into force on July 1, 2020. From that date it took the place of NAFTA. The Treasury Board Secretariat issued a contracting policy notice to tell federal departments about the replacement and what it meant for procurement policy.

Why Canada is outside the procurement chapter

Under NAFTA, Canada was bound by a procurement chapter. Under CUSMA, Treasury Board guidance explains that Canada is not a party to the government-procurement chapter, which applies only to Mexico and the United States. The CanadaBuys list of trade agreements likewise states that CUSMA's government-procurement obligations do not apply to Canada.

Market access still exists through other agreements. Canada's access to United States procurement is maintained principally through the World Trade Organization Agreement on Government Procurement (WTO GPA). Access to Mexican procurement is maintained through the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), as described in the Privy Council Office briefing on Bill C-4.

How CUSMA shows up in Canadian solicitations

CUSMA can still appear on CanadaBuys. Some tender notices list it alongside other agreements. One Public Works and Government Services Canada notice for a refresh of a standing offer arrangement named CUSMA, the WTO GPA, CETA, CPTPP, the Canadian Free Trade Agreement and several bilateral agreements.

Other notices state that CUSMA is exempt or does not apply, depending on the goods or services and the coverage of the agreements involved. An example is this CanadaBuys tender notice. The wording in each notice is what governs that procurement.

CUSMA is a North American trade agreement. It is not a NATO standard or a NATO acquisition framework.

The labour chapter and forced-labour clauses

CUSMA contains a comprehensive and enforceable labour chapter. Article 23.6 includes an obligation to prohibit the importation of goods produced wholly or partly by forced or compulsory labour, as described in a Public Services and Procurement Canada briefing. This led to amendments to Canada's Customs Tariff.

The resulting import prohibition applies to goods from all countries, not only the United States or Mexico, according to the Department of Finance supply chain report. Federal goods contracts include anti-forced-labour and code-of-conduct clauses that require suppliers and subcontractors to follow applicable laws and not supply prohibited goods. National Defence reports that its contracts resulting from specified procurement tools include forced-labour clauses from the Standard Contract Clause Inventory, as stated in the 2025-2026 public safety annual report.

What CUSMA means for a supplier bidding on Canadian public contracts

• Do not assume CUSMA creates Canadian bid rights. Canada is outside its procurement chapter.
• Read the solicitation and its incorporated clauses. Where CUSMA is listed, the notice controls how it applies. Where it is excluded, other agreements may govern.
• For goods, comply with Canadian import and supply-chain requirements, including the ban on goods produced wholly or partly by forced labour.
• Check contract clauses on forced labour and codes of conduct, and flow them down to subcontractors.