Canada, U.S. have reached a NAFTA deal, senior Canadian source says Facebook Twitter After more than a year of fractious negotiations, a deal has been reached John Paul Tasker · CBC News · Posted: Sep 30, 2018 12:40 PM ET | Last Updated: 12 minutes ago Foreign Affairs Minister Chrystia Freeland looks on as United States Trade Representative Robert Lighthizer delivers his statement to the media during the sixth round of negotiations for a new North American Free Trade Agreement in Montreal on Jan. 29. (Graham Hughes/Canadian Press) After more than a year of fractious negotiations, Canada and the U.S. have reached an agreement on key sections of a new North American Free Trade Agreement, a senior source told CBC News. Prime Minister Justin Trudeau convened a late-night meeting of cabinet to brief ministers on the NAFTA progress, only hours before a U.S.-imposed midnight deadline. At the heart of the deal is a trade-off between greater U.S. access to Canada's dairy market, which is heavily protected by a system of supply management, and Canadian demands for the maintenance of a dispute resolution process, sources said. In exchange for some U.S. concessions on a dispute mechanism, Canada is expected to give U.S. farmers greater access to Canada's dairy market by increasing the quota on foreign imports. Under the current supply management system, Canada imposes tariffs on dairy imports — which can run as high as 300 per cent — that exceed the established quota. Trump has railed against these tariffs as unfair to American farmers, as they are designed to keep foreign products out while privileging Canadian sources. U.S.-Mexico text may preview Canada's NAFTA prospects Mexican president-elect insists on trilateral NAFTA deal as text of U.S./Mexico deal awaited Sources said Canadian officials were going line by line through U.S. requests on dairy Sunday night before putting pen to paper on an agreement that could be politically challenging for the Liberal government, especially in Quebec, where dairy farmers hold electoral sway in certain ridings. It was not immediately clear what Canada has agreed to on dairy. At the outset of the NAFTA talks, the U.S. demanded Canada dismantle supply management entirely — something that Trudeau has maintained is a non-starter. Canada has long sought to maintain Chapter 19 of the original NAFTA, the dispute settlement mechanism used to challenge anti-dumping and countervailing duty cases, which Canada has deployed in the past over the softwood lumber file. Sources said the Americans have shown some movement on this file, despite entrenched opposition from U.S. Trade Representative Robert Lighthizer, that country's chief negotiator, who believes this chapter violates U.S. sovereignty. U.S. negotiators have been gunning for a new NAFTA by month's end to get a text of the agreement to Congress for its mandatory 60-day review period. That could allow for a deal to be signed before Dec 1., when Mexico's new, left-leaning president takes office. Under U.S. law, while Congress can extend fast-track negotiating authority to Trump administration officials — as it has with NAFTA — legislators retain the right to review any proposed trade agreement and decide whether it will be implemented. That relationship is governed by a set of strict, legislated timelines that allow Congress enough time to study a deal before delivering a decision.