CUSMA has been the backbone of Canada's trade relationship with its largest partners since it came into force on July 1, 2020. But with its first formal review scheduled in 2026, uncertainty is growing among Canadian businesses about what comes next.
Understanding where CUSMA stands now
It's important to separate headlines from legal reality. CUSMA remains in force until at least 2036, unless all three parties agree to extend it in the 2026 review. If they don't agree to extend, the agreement doesn't instantly disappear — it shifts into annual joint reviews, offering repeated opportunities to extend before 2036. Any country can also withdraw with six months' notice, which would immediately shift tariff arrangements. CUSMA isn't going away immediately, but its future beyond 2026 is uncertain, and businesses need to adapt.
1. Assess your exposure to CUSMA preferences
Start by understanding how much you rely on the benefits CUSMA currently provides. Catalog products and services shipped under CUSMA rules, verify compliance including tariff classifications and rules of origin, and work with a customs broker to pre-validate qualified shipments.
2. Scenario-plan for multiple outcomes
Because CUSMA's future is conditional, savvy companies build "what-if" models for withdrawal or termination, or annual joint reviews with no extension yet — including cost modelling for potential tariffs, supply-chain contingencies, and alternative markets.
3. Diversify markets and supply chains
Even in the best case, global trade is becoming more competitive and less predictable. Consider expanding into CPTPP markets, exploring bilateral agreements, and strengthening relationships with suppliers and distributors outside North America. See our breakdown of provincial U.S. export dependency for where this matters most.
4. Engage in policy and industry consultations
Governments are actively soliciting input. Participate in trade policy consultations, join industry associations that submit feedback, and share your own experiences with trade challenges.
5. Build strategic tariff and cost planning
With tariff risk on the table — including talk of U.S. tariffs applying even to some formerly duty-free goods — update pricing models with tariff scenarios, evaluate how duties affect competitiveness, and plan mitigation strategies like foreign trade zones or tariff engineering.
Prepare to adapt
The 2026 CUSMA review isn't a single event — it's the beginning of a strategic planning horizon. Know your reliance on CUSMA, scenario-plan for multiple futures, diversify your markets, engage in policy conversations, and stress-test tariffs and supply chains. Companies that prepare proactively can turn this uncertainty into a catalyst for smarter, more resilient growth.
Evaluate your export readiness now, before changes take effect.
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