U.S. trade relations with China and Canada reach new stages

More U.S. tariffs possible after midterm elections

The November 3 midterm elections in the United States could mark the beginning of another active period for trade policy. Shippers should prepare for the possibility of additional Section 301 tariffs targeting goods from specific countries or other trade actions later this year and into 2027.

While new Congressional leadership could pursue limits on the White House’s tariff authority, such bills could be vetoed.

Phase 3 of U.S tariff refunds begins

For U.S. tariffs that were declared illegal, Phase 3 of refunds began for certain customs entries that were already liquidated and could not be processed under earlier phases. The process initially applies to importers that have pending cases before the Court of International Trade, with approximately 3,700 cases addressed through case-specific court orders.

Importers with pending litigation should work with counsel to identify eligible entries, confirm importer-of-record information, and prepare for submission requirements. Importers with finally liquidated entries that have not filed suit should review potential refunds and available options with counsel, as the current process does not automatically provide refunds to non-litigants.

China trade truce may continue

Near-term U.S.-China escalation risk has eased as the trade truce between the countries is expected to continue into January, providing greater predictability through the holiday shipping season. The U.S. administration has proposed extending the suspension of Section 301 maritime fees and related duties targeting China through January 9, 2027, allowing negotiations to continue.

U.S. modifies 50% tariffs on Canadian products

Effective October 30, 2026, the United States revised the list of Canadian products subject to the additional 50% Section 338 tariff. Certain plywood, paper products, machinery, refrigeration equipment, and packing containers were removed, while certain valves, carpets, and waste products were added.

U.S.-Mexico-Canada Agreement (USMCA) eligibility does not exempt covered products, and Section 232 tariffs may apply in addition to the 50% duty. U.S. importers should review affected classifications and landed costs.

Despite months of escalating tariffs and countermeasures such as these, the United States and Canada appear to be moving back toward negotiations. A deal tied to the USMCA remains the most commercially viable outcome for both countries and could provide greater certainty for integrated North American supply chains heading into 2027.

U.S. begins consultation for 2027 USMCA review

The Office of the U.S. Trade Representative has formally opened the public consultation process ahead of the 2027 review of USMCA. Following the July 2026 review, when the United States did not agree to extend the deal for another 16-year term, USMCA moved into annual reviews until all three countries agree to an extension or the deal expires in 2036.

Input is requested on issues including rules of origin, customs procedures, compliance, the North American investment environment, and regional competitiveness. Written comments and requests to participate in the public hearing are due January 12, 2027, making the consultation period an important step in defining the issues that will shape next year's review.

U.S. Customs considers expanded supply-chain disclosure

U.S. Customs is considering new requirements that could significantly expand the supply chain information importers provide to the government. Its Advance Notice of Proposed Rulemaking sought input on identifying additional parties involved in imported goods, collecting foreign export documentation, and potentially using new technology to improve supply chain traceability.

The stated objective is to better detect illegal transshipping, tariff evasion, and other customs violations.

These are not yet requirements. The rulemaking remains in the information-gathering stage, with public comments due December 1, 2026. Any eventual requirements would follow further rulemaking.

Three biotech companies added to forced labor list

On October 29, 2026, the Department of Homeland Security added three entities to the Uyghur Forced Labor Prevention Act Entity List: BGI Genomics Co., Ltd.; MGI Tech Co., Ltd.; and Shenzhen BGI Technology Co., Ltd.

The companies are associated with genetic sequencing technology, instruments, reagents, and related biotechnology products. U.S. importers should screen suppliers and supply chains for these entities. Goods produced wholly or partly by a listed entity may be prohibited from entering the United States unless requirements are met.

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