CUSMA (Canada–United States–Mexico Agreement)

What it means

CUSMA is the free trade agreement between Canada, the United States, and Mexico that replaced NAFTA in 2020 (sometimes called USMCA, or "the new NAFTA"). Goods that meet its rules of origin — broadly, having enough North American content — can often cross those borders tariff-free.

Why it matters

Whether a product qualifies as CUSMA-compliant has historically been a major factor in whether it faces tariffs at all, though it isn't an absolute guarantee — some tariff actions have applied even to CUSMA-compliant goods.

Common misunderstandings

• •CUSMA compliance has protected against most, but not every, tariff action — it isn't an unconditional shield in every case.
• •The agreement is scheduled for periodic review by all three countries, which can change its rules over time.

Where you'll see it

In trade policy coverage, and in customs paperwork determining whether a shipment qualifies for tariff-free treatment.