Protecting the USMCA from Harmful Chinese Investment Act
- Sponsor
- Sen. McCormick, David [R-PA]
- Committees
- Finance Committee (primary)
- Last action
- Sep 18, 2025
Bottom line
This bill aims to strengthen North American national security by encouraging Canada and Mexico to implement robust foreign investment screening processes akin to the U.S. CFIUS framework, specifically targeting investments from nonmarket economy countries like China.
What it actually does
This bill directs the United States Trade Representative (USTR) to advocate for Canada and Mexico to establish legislative and regulatory frameworks for reviewing foreign investments for national security risks, similar to the U.S. Committee on Foreign Investment in the United States (CFIUS). It also seeks to establish a mechanism for USMCA countries to coordinate on shared threats from investments by nonmarket economy countries, such as the People's Republic of China, during the next joint review of the United States-Mexico-Canada Agreement.
Proponents argue
Proponents argue that this bill is essential for strengthening the collective national security interests of the United States, Mexico, and Canada by creating a unified approach to screening foreign investments from nonmarket economy countries. They contend that harmonizing investment review mechanisms will protect critical North American supply chains and infrastructure from strategic threats, thereby safeguarding millions of jobs and advancing shared security goals.
Opponents contend
Potential opponents might argue that this bill could be perceived as an overreach into the sovereign economic policies of Canada and Mexico, potentially straining diplomatic relations or creating unnecessary barriers to legitimate foreign investment. They might also contend that existing national mechanisms in Canada and Mexico are sufficient, or that a harmonized approach might not adequately address each country's unique economic and security considerations.
The bill is exceptionally short and clearly written, making it highly accessible for a quick and thorough review by any interested reader.
Section 2(b)
Joint Review Negotiation Objective
This provision mandates that during the first joint review conducted under the United States-Mexico-Canada Agreement (USMCA) after the bill's enactment, the U.S. Trade Representative (USTR) must advocate for two key objectives. First, each USMCA country (Canada and Mexico) should implement a legislative and regulatory framework for reviewing foreign investments for national security risks that is similar to the framework established under section 721 of the Defense Production Act of 1950 (which governs CFIUS). Second, the USTR must advocate for the establishment of a mechanism for USMCA countries to coordinate to address shared threats from investments by nonmarket economy countries.
Supporters argue
Supporters argue this provision is crucial for creating a unified and robust front against strategic investments by adversarial nonmarket economies, thereby safeguarding critical North American supply chains and national security interests across the continent. It ensures that all USMCA partners are equipped to address shared threats.
Critics contend
Critics might contend that this provision could be perceived as an overreach into the sovereign regulatory authority of Canada and Mexico, potentially straining diplomatic relations or creating unnecessary hurdles for legitimate foreign investment. They may argue that each country should determine its own national security investment review processes.
Tradeoffs
The tension lies between strengthening collective national security through harmonized investment screening and respecting the sovereign economic policies and regulatory autonomy of Canada and Mexico. It also balances the desire for open investment with the need to protect critical infrastructure from specific threats.