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Canada Imposes Provisional 25 Percent Tariff on Certain Steel Products

As part of its on-going efforts to protect Canada’s steel industry and support Canadian workers and businesses, the Canadian government announced on 11 October the imposition, effective for a 200-day period from 25 October and in cases where the level of imports from trading partners exceeds historical norms, of a provisional 25 percent safeguard tariff on seven classes of steel products: (1) energy tubular, (2) heavy plate, (3) hot-rolled sheet, (4) pre-painted steel, (5) concrete reinforcing bar, (6) wire rod and (7) stainless steel wire.

Goods subject to this action are classified under HTSCA 7208.51.0010, 7208.51.0093, 7208.51.0094, 7208.51.0095, 7208.52.0010, 7208.52.0093, 7208.52.0096, 7213.10.0000, 7214.20.0000, 7304.19.0010, 7304.19.0020, 7304.29.0011, 7304.29.0019, 7304.29.0021, 7304.29.00.29, 7304.29.0031, 7304.29.0039, 7304.29.0081, 7304.29.0089, 7305.11.0010, 7305.11.00.20, 7305.12.0010, 7305.12.0030, 7305.19.0010, 7305.19.0020, 7306.19.0010, 7306.19.0090, 7306.29.0011, 7306.29.0019, 7306.29.0051, 7306.29.0059, 7306.29.0061, 7306.29.0069, 7208.25.0000, 7208.26.0000, 7208.27.0000, 7208.36.0000, 7208.37.0010, 7208.37.0020, 7208.37.0050, 7208.38.0010, 7208.38.0020, 7208,38.0050, 7208.39.0000, 7208.53.0000, 7208.54.0000, 7208.90.0000, 7211.14.0090, 7211.19.0090, 7225.30.0000, 7226.91.0000, 7210.70.0000, 7212.40.0000, 7223.00.0010, 7223.00.0020, 7213.20.0010, 7213.91.0011, 7213.91.0021, 7213.91.0031, 7213.99.0010, 7213.99.0030, 7213.99.0050 and 7227.90.0010. Detailed descriptions of the items covered are available at http://www.international.gc.ca/controls-controles/report-rapports/list_liste/handbook-manuel/content_c_contenu.aspx?lang=eng.

The additional tariff will apply to imports of subject merchandise from all sources, including Hong Kong and mainland China, except the United States, Chile, Israel and any other Canada-Israel FTA beneficiaries. For goods originating in and imported from Mexico, the tariff will only apply to energy tubular products and wire rod. Additionally, the tariff will not apply to subject goods originating in and imported from General Preferential Tariff beneficiary developing countries, with the exception of concrete reinforcing bar originating in and imported from Vietnam.

Subject merchandise imported under the tariff-rate quotas described below will be exempt from the additional tariff. These TRQs will be administered in four consecutive 50-day periods: 25 October through 13 December 2018, 14 December 2018 through 1 February 2019, 2 February through 23 March 2019, and 24 March through 12 May 2019. The quantity of goods that may be imported free of the safeguard tariff under each TRQ in each 50-day period is shown below. Quantities that remain unutilised in any one period will be added to the quantities in the following period.

TRQ for Each 50-Day Period (Tonnes)Total 200-Day TRQ (Tonnes)Maximum Share of Total TRQ per Country
Heavy plate12,91851,67223%
Concrete reinforcing bar35,332141,32823%
Energy tubular products64,348257,39223%
Hot-rolled sheet15,29961,19637%
Pre-painted steel11,63546,54035%
Stainless steel wire4671,86825%
Wire rod11,51346,05247%

The TRQs will be administered by way of shipment-specific import permits issued on a first-come, first-served basis. Once imports originating in any one country account for a specific percentage of a TRQ, as set out above, shipment-specific import permits will no longer be issued for imports originating in that country. Goods that originate in that country may continue to enter Canada under General Import Permit 80 or General Import Permit 81, as the case may be.

Concurrently, the Canadian International Trade Tribunal has launched a safeguard action on the steel products described above. The purpose of this investigation is to determine whether any of the above-mentioned goods are being imported into Canada in such increased quantities and under such conditions as to be a principal cause of serious injury or threat thereof to Canadian producers of like or directly competitive goods. Imports from the United States, Chile, Mexico (with the exception of energy tubular and wire rod classes of goods), and Israel and other CIFTA beneficiaries are excluded from the CITT’s inquiry.

Notices of participation and representation, declarations and undertakings are due by 29 October, questionnaire replies are due by 31 October, case briefs of parties must be submitted by 6 December, reply briefs are due by 13 December, the deadline for procedural and preliminary matters is 27 December, public hearings will be held during 3-22 January, and the CITT’s report (including any recommendations) will be issued on 3 April.

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