By Shiraz Ahmed, Sartorial Wealth

The trade deal that governs almost everything Canada sells to the United States is still alive. It just comes with a new yearly ritual now.

On July 1, the United States declined to extend CUSMA for another sixteen years. That sounds dramatic. What it actually did was flip the agreement into an annual review process. Every year, the three countries revisit the deal, until they either agree to extend it or it expires in 2036. Nothing about your rights changed on July 1. The certainty horizon did.

What happened, and what did not

Here is the part that gets lost in the headlines. The agreement remains fully in force. Preferential tariffs, rules of origin, investment protections, and dispute settlement all continue to operate exactly as before. The US Trade Representative cited the deal’s shortcomings and trade deficits as the reason for declining the longer extension. But declining a sixteen-year renewal is not the same as tearing up the deal. The rules that Canadian exporters and cross-border businesses rely on are still the rules today.

The Monday update

As of this morning, Canada is openly asking what the new process even looks like. Trade Minister Dominic LeBlanc said Canada is seeking clarity and called the annual review uncharted territory, adding that there is no more predictability about how it will work. He asked the US Trade Representative, jointly with Mexico’s economy secretary, how the reviews will be structured. He did not get an answer at the meeting, and the parties agreed to keep talking over the coming weeks. The next US-Mexico negotiating round is set for the week of July 20, and Canada has not yet begun text-based talks of its own.

The currency connection

Uncertainty has a price, and right now the loonie is paying part of it. The Canadian dollar has been trading near a 14-month low around 1.42 per US dollar, and analysts have pointed to CUSMA uncertainty as one reason they trimmed their forecasts and cooled their bets on Bank of Canada rate hikes. Trade is the overhang. For a cross-border household, that shows up in the exchange rate on every dollar you move across the border.

How to separate durable rules from annual noise

1. Know what is actually binding. Today, all of your CUSMA rights are intact. Plan around the rules as they exist, not around a worst case that has not happened.
2. Expect a yearly headline cycle. Each annual review will produce a wave of alarming coverage. Build the expectation of noise into your plan so the noise does not run your decisions.
3. Watch the loonie, not the tweets. The clearest, most immediate way trade uncertainty reaches your balance sheet is through the currency. That is the number worth tracking.
4. Keep cross-border structures flexible. If you own a business or assets on both sides, this is the year to make sure your structure can absorb change, rather than betting on any single outcome.

The deal is not dead. It is on an annual clock, and that clock will tick loudly every year. The job is to tell the difference between a genuine change in the rules and another round of noise. One deserves a decision. The other deserves a deep breath. Which one is driving your plan right now?

Frequently Asked Questions

Is CUSMA cancelled?

No. The United States declined to extend the agreement for a further sixteen-year term, which triggered an annual review process. The deal remains fully in force, with all tariffs, rules of origin, and protections still operating.

What does an annual review actually mean?

Instead of a single long extension, the three countries will now revisit the agreement each year. The process continues until they agree to extend it or it reaches its expiry. As of early July, even the governments involved say the exact process is still unclear.

When does CUSMA expire?

If no path to extend it is agreed, the agreement would expire in 2036. The sixteen-year extension that the United States declined would have carried it well beyond that date.

How does this affect the Canadian dollar?

Trade uncertainty has weighed on the loonie, which has traded near a 14-month low around 1.42 per US dollar. Analysts have cited CUSMA uncertainty as a reason for trimming their currency forecasts and reducing expectations of Bank of Canada rate hikes.

Should cross-border business owners change their plans?

Not reflexively. Today’s rules are unchanged. The prudent step is to keep cross-border structures flexible so they can absorb change over the multi-year review period, rather than making large bets on any single outcome.

Sources

Raymond James, “the Open” (subscription client newsletter, no public URL) | Global News (The Canadian Press) | BNN Bloomberg | White & Case | Canada’s National Observer

Disclaimer

This article is for general informational purposes only and reflects market conditions as of July 6, 2026. It is not investment, tax, or legal advice, and it does not account for your personal circumstances. Sartorial Wealth specializes in cross-border financial planning between Canada and the United States; we do not prepare tax returns. Markets and currency levels move quickly, and the figures cited may have changed since publication. Please speak with a qualified advisor before acting on anything here.