Contributing Lawyers

Canada

Cyndee Todgham Cherniak

United States

Susan Kohn Ross

Australia

Andrew Hudson



Canada’s 2012 Federal Budget Contains a Shocker for the Trade Remedies Bar

On March 29, 2012, Canada’s Minister of Finance delivered the federal budget.  On page 108 of the 2012 Economic Action Plan, the following announcement is made:

Streamlining Canada’s Trade Remedy System

Economic Action Plan 2012 proposes to consolidate Canada’s trade remedy investigation functions into one organization, under the Canadian International Trade Tribunal.

Canada’s continued support for trade liberalization is complemented by a strong and effective trade remedy system, which acts as an important safety valve for Canadian manufacturers harmed by unfairly traded imports. Canada’s trade remedy system is currently jointly administered by the Canada Border Services Agency and the Canadian International Trade Tribunal (CITT).

In Budget 2011, the Government committed to proposing initiatives to ensure Canada operates an efficient trade remedy system. To deliver on this commitment, the Government will introduce legislation to consolidate Canada’s trade remedy investigation functions into one organization, under the CITT. This restructuring will create efficiencies that will help the Government maintain and sustain an effective trade remedy system. This initiative will also cut red tape, making it less cumbersome for Canadian businesses to take action against unfair trade, and will result in cost savings.

This short announcement in a 498 page document is sending shockwaves in the trade remedies bar.  To make this happen, a major revision of the Special Import Measure Act (“SIMA”) and Special Import Measures Regulations will be required.

Currently, an anti-dumping and/or countervailing duty complaint is filed with the Canada Border Services Agency (“CBSA”).  Currently, the CBSA makes a determination as to whether the complaint is properly documented. The CBSA establishes the scope of the product description.    Currently, the CBSA conducts the dumping and subsidy investigations and makes preliminary and final determinations.  The CBSA calculates normal values, export prices and dumping margins.  The CBSA determines amounts of subsidy.  The CBSA conducts reinvestigations of normal value and export prices.  The CBSA has a role in expiry reviews and determines whether antidumping and/or subsidization with resume or continue if the duties are removed. 

The extent to which these mandates will be transferred to the Canadian International Trade Tribunal (“CITT”) as a result of the March 29, 2012 announcement is to be determined.  The CITT is created by the Canadian International Trade Tribunal Act.  The CITT has the powers of a superior court of record.  The CITT currently has a mandate to conduct injury investigations, conduct the injury inquiry in the expiry review process, hears SIMA appeals, hears customs appeals, hears procurement complaints, conducts global and China specific safeguard inquiries, conducts textile references, etc.  The CITT is already very busy and the proposed change will significantly add to their workload.

If the CBSA’s role is to be eliminated, it would be like ending the Department of Commerce’s role in U.S. trade remedies cases and moving the responsibilities to the International Trade Commission.

The proposed Economic Action Plan change intends to improve access to Canada’s trade remedies by small and medium sized manufacturers.  The intention is to streamline the process, which should make pursuit of legal rights less expensive. 

Please stay tuned because changes are coming ...

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