Canada looks to trade talks after US Supreme Court tosses Trump's tariffs

February 21, 2026

Following the US Supreme Court's decision to overturn President Trump's global tariffs imposed under emergency powers, Canada experienced only limited relief as most trade-impacting levies remain in place. While the court struck down tariffs initially justified by fentanyl concerns, approximately 85% of trade was already exempt under the existing US-Canada-Mexico trade agreement (USMCA), and Trump quickly replaced them with a new 10% global tariff maintaining similar exemptions. Canada's primary concern now centers on the upcoming USMCA review deadline this summer, with Trump administration officials signaling preference for separate bilateral agreements rather than renewing the trilateral deal.

Who is affected

Canada, Mexico, and China (subject to tariffs)
Canadian manufacturers and exporters
US-Canada Trade Minister Dominic LeBlanc and his office
US Trade Representative Jamieson Greer
The Trump administration and White House
Canadian steel, aluminum, and automobile sectors
American media companies including Netflix and Spotify (affected by Canadian Online Streaming Act)
Canadian business groups including Canadian Manufacturers & Exporters and CEO Dennis Darby
Ontario province (whose anti-tariff advertisement caused trade talk suspension)
Over 500 million people in the USMCA market

What action is being taken

The White House is implementing a new 10% global tariff to replace the struck-down IEEPA duties, taking effect on Tuesday
Canada is working to build trade ties outside the US with a goal of doubling non-US exports by 2035
The Trump administration is maintaining tariffs on steel, aluminum, and automobiles
The USMCA exemption continues under the new 10% tariff

Why it matters

This matters because Canada's economy is deeply integrated with the United States, which purchases approximately 75% of Canadian exports, making trade stability crucial for Canadian manufacturers and businesses. The upcoming USMCA review represents a critical juncture that could fundamentally reshape North American trade relationships that have existed since the early 1990s, affecting a market of over 500 million people. The Trump administration's preference for bilateral rather than trilateral agreements threatens to fragment the integrated North American economy, creating ongoing uncertainty that disrupts business planning and investment decisions on both sides of the border.

What's next

All three USMCA partners must decide this summer whether to extend the deal ahead of a July 1 deadline
LeBlanc will meet with US Trade Representative Jamieson Greer in the coming weeks to discuss the review talks
USMCA review negotiations are expected to intensify ahead of the July 1 deadline
The new 10% global tariff will take effect on Tuesday

Read full article from source: BBC