2026 will be a crucial year to determine the continuity of the Treaty between Mexico, the United States and Canada, better known as USMCA; this first six-year review that is scheduled for July 1st, 2026 is a procedural verification that will allow determining the continuation of the trade agreement. Nevertheless, the political and economic context has transformed this review mechanism into a latent test that can put at risk the trade relationship of North America, since in this context the United States has expressed great concerns regarding the observance and enforcement of IP rights in our country. Although at first these concerns were merely commercial, now they have become inexplicably intertwined with the containment of China’s economic influence and the consolidated regional supply chains through “nearshoring”.
The Intellectual Property chapter will be a central axis where commercial, legal, and strategic tensions will be resolved, so the USMCA review will be crucial to define the future of the Treaty and competitiveness in North America. The outcome will determine if the USMCA is consolidated as a pillar of stability for the region or if a stage of uncertainty is generated that could neutralize the economic benefits that it has generated to date.
The legal framework of the 2026 review is supported by Article 34.7 of the USMCA; this provision is known as the “Review and Term Extension Clause” or more commonly the “Sunset Clause,” which is based on a cycle of reviews and extensions that determines the of the treaty’s longevity. The treaty has an initial term of 16 years with a six-year review by the USMCA Free Trade Commission, which is made up of representatives from the three countries. During the review, each country must express its desire to extend the treaty’s term for a new 16-year period, which would end on July 1, 2042, with a joint review in 2032. If one or more parties do not wish to extend the Treaty, it would not expire immediately, but would enter a “contingency” phase during which the Free Trade Commission must review the treaty “annually” for the remainder of the treaty’s term.
It should be clarified that the text of Article 34.7 establishes a “review” of the treaty, not a “renegotiation,” although any party may propose amendments at any time in accordance with Article 34.3. While the structure of Article 34.7 is an important foundation for the “review” of the Treaty, the United States, being the most powerful country in terms of economy, could threaten to withhold the extension in order to discuss issues it considers unresolved or unsatisfactory, and the practice of “review” would shift to “renegotiation” under pressure.
While each country has its own internal process to establish a position when the Treaty is reviewed, it is worth highlighting the Special 301 Report of 2025 issued by the United States Trade Representative (USTR), which evaluates the protection of IP rights in the United States’ trading partners. This report will be the United States’ negotiating plan but it also contains a list of problems that Mexico will have to resolve; among these problems it is worth mentioning: 1) The inclusion of Mexico on the “Priority Watch List,” which includes countries with serious IP deficiencies, such as China, Russia, Venezuela, Argentina, and Chile. 2) Failure to publish the implementation Regulations for the IP laws approved in 2020 and that would allow aligning Mexican legislation with the USMCA. The fact that these regulations have not been published creates a legal vacuum that mitigates the effective application of the laws; 3) Nonexistent criminal proceedings for trademark counterfeiting and the Attorney General’s Office (FGR) failure to publish statistics on IP enforcement over the past 5 years; 4) Ineffective border measures, as the National Customs Agency lacks ex officio authority to seize counterfeit goods; 5) Problems implementing the patent-sanitary registration linkage system, the protection of clinical trial data, especially for biological products, and mechanisms for adjusting patent validity to compensate for delays by the Authority; 6) High rates of digital piracy in music and video games. Therefore, our country must demonstrate verifiable and tangible progress way in these areas to achieve a smooth extension of the Treaty.
Among the actions our country has undertaken to demonstrate its commitment to intellectual property and to allow it to arrive strengthened at the USCMA review, the following stand out: i) The “cleanup operation” with major operations to seize millions of pounds of illegal merchandise originating from Asia, primarily China, in Mexico City and various states across the country, which earned special mention in the United States’ 301 Report. Mexico must maintain the frequency of these operations to avoid the imposition of tariffs from the United States; ii) The IMPI-COFEPRIS Agreement published in the Official Gazette of the Federation on March 6, 2025 to strengthen and make transparent the “linkage-sanitary registration” system. This agreement aims to prevent COFEPRIS from granting health registrations for generic drugs that could infringe current patents; iii) Legislative and diplomatic efforts to ensure that pending regulations currently in the final review stage by the Legal Counsel of the Federal Executive Branch are published as soon as possible.
The review of the USCMA will focus on three specific areas of industrial property due to their technical complexity and economic importance:
- PHARMACEUTICALS AND BIOLOGICS: The United States will thoroughly review the operation of the recent IMPI-COFEPRIS Agreement, the expeditiousness of consultations, and the effectiveness of the opposition mechanism that allows patent holders to express potential impacts during the processing of a health registration. It will also review the implementation and strict enforcement of the 10-year exclusivity period for test data for biologics, as well as the methodology used by our country to compensate for “unreasonable delays” in the process of granting a patent or obtaining a marketing authorization.
- COMBATING ONLINE PIRACY: Mexico is one of the countries with the highest rates of digital piracy worldwide, including illegal downloading and streaming of music, movies, television series, and video games, which results in millions of dollars in losses for the creative industries. Therefore, the efficiency and speed of the “notice and takedown” procedure adopted by Mexico in the USCMA will be severely evaluated in the 2026 review. The lack of implementing regulations detailing the procedure and the absence of effective measures against repeat offenders, such as account termination, will also be addressed. Another issue that will be reviewed is the digital sale of counterfeit products that are physically delivered.
- TRADEMARKS AND BORDERS: The United States has consistently complained about the lack of a robust and proactive system in the fight against trademark counterfeiting, since, as already mentioned, the Customs Authority cannot act ex officio at the border and there are almost no criminal proceedings against trademark counterfeiters. Another important point will be the containment of unfair trade practices perceived by the United States, since the majority of counterfeit goods distributed in Mexico originate in Asia, primarily China. Finally, the review of the USCMA will also focus on ensuring that the previously mentioned “Operation Cleanup” contributes to a systematic change in laws that allow for a greater number of criminal convictions for counterfeiting and not just temporary actions that criminal networks can exploit to continue operating.
The USMCA review will also consider the potential triangulation of Chinese products reaching the U.S. market, as the United States fears that China will use Mexico to process and minimally assemble Chinese products that would then be shipped to the United States as a way to avoid tariffs imposed on Chinese products. Therefore, Mexico must be stricter regarding Chinese investments and imports. Otherwise, the United States could force Mexico to apply mirror measures, meaning that our country could apply the same US tariffs to Chinese products, which would place Mexico in a delicate diplomatic situation.
The nearshoring phenomenon also plays an important role in the upcoming USMCA review, as Mexico is seen as a primary destination for foreign direct investment, driven by the need for more secure and resilient supply chain. For nearshoring to be viable, a robust and reliable IP system is required where high-value-added companies can be certain that their IP rights will be rigorously protected. In this context, and given that it is also important for the United States to secure its supply chains and reduce its dependence on Asia, nearshoring becomes a central and extremely important point in the USMCA review, since the more manufacturing processes are moved to Mexico, the more valuable IP rights become, thus generating exhaustive surveillance by US companies and zero tolerance for any loopholes that could violate them.
Experts envision several scenarios that for the USMCA review next year, some with zero or low probability, others with intermediate probability. However, the most likely scenario is one in which the United States agrees to the extension of the agreement after a difficult negotiation process in which Mexico commits to specific, verifiable IP compliance, as well as to clear policies regarding Chinese investment. Even if the extension is granted, it will not be exempt from future friction and threat from the United States.
In order for our country to achieve the best possible outcome in this review, it will be necessary to publish the pending regulations immediately; submit progress reports by the USMCA Intellectual Property Rights Committee; and present documentation and evidence that the country’s productive sectors are meticulously complying with the USMCA rules, especially the automotive sector, which is a key element in this review, to name some actions that encompass internal policy, diplomacy, and collaboration with the private sector.
Without a doubt, the 2026 revision of the USMCA will pave the way for a new, more demanding North American trade relationship, one in which Mexico will have to demonstrate its ability to fulfill the IP commitments it made in 2020, as the United States made clear in its 301 report that IP is a fundamental aspect of the Agreement’s continuation under its current terms. While the path forward is not easy for Mexico, it will be surmountable as long as it rigorously implements its laws and is able to position IP protection as a fundamental pillar of its economic development model.
References:
1- Revisión T-MEC 2026 – OBSERVATORIO LEGISLATIVO DE ASUNTOS GLOBALES
2- United States – Mexico – Canada Agreement (USMCA) Sunset Clause Review and Term Extension – sre.gob.mx
https://embamex.sre.gob.mx/eua/images/stories/economicos/nafta_chapters/Sunset_.pdf
3- Revisión del TMEC en 2026 enfrenta desafíos y tensiones según representante de Comercio Exterior de EE. UU. – Cancham
4- Tres temas cruciales en la revisión del T-MEC en 2026 – THE LOGISTICS WORLD
5- Los riesgos y oportunidades de la revisión del TMEC – Forbes México
https://forbes.com.mx/los-riesgos-y-oportunidades-de-la-revision-del-tmec/
6- Revisión del T-MEC en 2026 ¿cómo deben prepararse las empresas? – Cluster Industrial
https://clusterindustrial.com.mx/revision-del-t-mec-en-2026-como-deben-prepararse-las-empresas/
Margarita Guerrero
mguerrero@uhthoff.com.mx
