United States Trade Representative announced that in accordance with the United States-Mexico-Canada Agreement (USMCA), the United States has formally invoked the Rapid Response Labor Mechanism (RRM), to review whether workers at the Teklas Automotive facility in Aguascalientes are being denied the right to freedom of association and collective bargaining.

The RRM petition was filed by La Liga Sindical Obrera Mexicana (LSOM), an independent Mexican union, and the International Lawyers Attending Workers Network (ILAW Network), due to alleged threats and dismisses to its workers in retaliation for undertaking union organizing activities.

It is important to note that the USMCA, sets forth the following remedies or sanctions for those companies that deny the right to freedom of association of its workers:

• Suspension of preferential tariff treatment for goods manufactured at the Facility or the imposition of penalties on goods manufactured at or services provided by the Facility.
• Suspension of preferential tariff treatment for such goods.
• Imposition of penalties on such goods or services.
• Denial of entry of such goods to US or Canada.

Consequently, we suggest that if you have any business or commercial relationship with Teklas Automotive stay tuned for information related to this RRM. Furthermore, if any time there is a situation that could be a denial of freedom of association or the right to collective bargaining, please let us know as soon as possible to give you legal advice to comply with your Employer Obligations and avoid any sanction or remedies stated at USMCA or any law or regulation.