Gajan Sathananthan, Riyaz Dattu
Jun 6, 2018
In our last international trade brief, we discussed the apparent trade policy reasons for the U.S. administration imposing the aluminum and steel tariffs. In this trade brief, we discuss Canada’s response to the tariffs and the federal government’s invitation for written submissions on the proposed tariffs.
On June 1, 2018, Canada’s exports of aluminum and steel became subject to tariffs of 10% and 25%, respectively. The tariffs follow the Department of Commerce investigation of the effects of imports of these products on U.S. national security. While initially exempted, Canada and Mexico became subject to these tariffs on June 1, 2018. These tariffs are expected to have a large impact on Canadian producers, who are the largest exporter of aluminum to the U.S. and among the largest exporters of steel to the U.S.
In response, Prime Minister Justin Trudeau and Minister of Foreign Affairs Chrystia Freeland immediately announced that Canada would be responding to the U.S. tariffs with “dollar-for-dollar” tariffs on imports of U.S. origin goods to Canada, valued at approximately $16.6 billion. The Canadian government has also left the door open to additional measures as may be required.
The proposed tariffs being imposed as countermeasures — so long as the U.S. tariffs remain in place — include a 25% tariff on imported steel and a 10% tariff on aluminum imports from the U.S., and also include a 10% tariff on an assortment of more than 70 other imported goods, including everyday grocery items such as yoghurt, cucumbers and ketchup, orange juice, strawberry jam, home appliances, and boats and camping equipment. The full listing of proposed tariffs, both at the 25% and 10% rates, can be found in the Notice of Intent to impose Countermeasures published by the Department of Finance.
The tariffs are set to come into force on July 1, 2018. Prior to this, the Canadian government is inviting written submissions on the proposed tariffs, which must be submitted to the Department of Finance by June 15, 2018. Businesses on both sides of the border should review the list published by the Department of Finance to determine if they will be impacted. The Canadian government is seeking views from those who support the countermeasures as well as those opposed to these measures. The submissions may include the following:
- Canadian company/industry association name, address, telephone number, and contact person.
- Relevant eight-digit tariff item(s) and description of the goods of particular interest.
- Reasons for the expressed support for, or concern with, the proposed countermeasures, including detailed information substantiating any expected beneficial or adverse impact.
- If concern is expressed with respect to the proposed countermeasures for one or more eight-digit tariff item(s), views on ways to alleviate such concerns.
As previously noted, the submissions to the Canadian government are due by June 15, 2018. Osler has over 25 years of experience in making submissions on NAFTA tariff-related matters (and the predecessor agreement) to the Department of Finance, and can assist clients in communicating their position fully and persuasively in relation to these measures.