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GOP Sen. Pat Toomey: President Trump doesn't have the authority to exit NAFTA

  • The Pennsylvania Republican says NAFTA was an agreement passed by Congress.
  • "The president doesn't have any more authority to repeal that law than he has authority to repeal Obamacare or change taxes," he says.
  • Toomey argues for a "modernized" version of NAFTA rather than a withdrawal from the existing version.

Sen. Pat Toomey told CNBC on Friday the Trump administration doesn't have the unilateral authority to pull out NAFTA.

"NAFTA wasn't a treaty. It's an agreement," the Pennsylvania Republican said on "Squawk Box."

"The president doesn't have any more authority to repeal that law any more than he has authority to repeal Obamacare or change taxes," he contended.

The North American Free Trade Agreement, a trilateral trade deal between the U.S., Canada and Mexico, was passed by Congress in 1993 during Bill Clinton's presidency. It went into effect in 1994.

President Donald Trump has been threatening to pull out of NAFTA if a better agreement cannot be reached. Trade officials have been trying to wrap up negotiations and reach a new deal before Mexico's presidential election on July 1.

However, the latest round of talks made little headway in Washington this week as the U.S. and Mexico sought to settle differences over the key issue of autos, three well-placed sources told Reuters. The Trump administration wants requirements to boost the U.S. content of vehicles.

Toomey wrote an op-ed in Friday's Wall Street Journal arguing the historic deal should be renegotiated rather than completely uprooted.

"Ideally, we get the outline of a good constructive agreement that modernizes NAFTA, doesn't move in a protectionist direction," he said.

His list of improvements includes protecting intellectual property, adjusting Canada's diary tariffs and raising the dollar cap amount of duty-free goods to Mexico.

However, the senator said he's not in favor of tightening rules of origin and content requirements.

"That's contrary to the spirit of NAFTA and having a free trade agreement," Toomey said.

He's also not in favor of the so-called Sunset Provision that "introduces a complete uncertainty about how long this is going to last."

The best possible outcome, he argued, is an improvement of the existing deal.

"What I'm urging is, don't negotiate a protectionist agreement and then threaten to pull out from the current agreement and tell Republican pro-trade senators, well, here's your choices: this lesser NAFTA or nothing," Toomey said.

"I think, Republican senators are pro-trade, and pro-NAFTA," he said. "So the support would be there if it's a good agreement."

House Speaker Paul Ryan set a May 17 deadline to be notified of a new NAFTA trade deal in the hopes that Congress will approve it.

Toomey said the Trump administration "has a fight on their hands" if it tries to pull out of NAFTA without the consent of Congress.

— Reuters contributed to this report.

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