IPP&T Magazine Online

Ottawa moves to stop transshipment and diversion of steel, aluminum

March 27, 2018  

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The transshipment and diversion of unfairly cheap foreign steel and aluminum is a threat to Canadian jobs and the North American market – and Ottawa is taking steps to combat it.

Canada is a trading nation, and we will not allow North American industries to be hurt or threatened by unfair trade practices, like the diversion of steel and aluminum,” says Prime Minister Justin Trudeau. “Our businesses and workers rely on our integrated industries, and we will take strong action to defend and protect our most important trade relationships.”

Canada already has one of the toughest enforcement regimes in the world to combat this practice, with 71 trade remedy measures in force on steel and aluminum imports alone. According to a statement from the Prime Minister’s Office, they are strengthening enforcement further to stop foreign exporters from avoiding duties meant to level the playing field.

“Canada will not be used as a backdoor into other North American markets,” says Trudeau. “Our people have worked hard to be competitive in this global economy, and they deserve a level playing field.”

The following regulatory changes will be brought forward and be subject to a 15-day consultation period through the Canada Gazette:

• New anti-circumvention investigations will allow the Canada Border Services Agency to identify and stop companies that try to dodge duties (for example, by slightly modifying products or assembling them in Canada or a third country).

• In calculating duties, the Canada Border Services Agency will have greater flexibility in determining whether prices charged in the exporter’s domestic market, which we use for comparison, are reliable or distorted.

• Unions will gain standing to participate in trade-remedy proceedings, including at the Canadian International Trade Tribunal, into whether foreign exports are hurting domestic producers.

In addition, the Government of Canada will:

• Coordinate more closely with our partners to strengthen enforcement at the border, including by increasing the frequency of meetings between border agencies. This will improve the sharing of information and enforcement action. We will also urgently undertake a review to make sure our enforcement agencies have all the resources they need to take action on unfair trade.  

• Look to meet more often with the United States and Mexico to identify and discuss solutions to issues that harm all three countries, including transshipment, diversion, and global overcapacity.

• Participate in new federal-provincial-territorial-stakeholder committees, which will meet regularly to monitor steel and aluminum trade to ensure imports do not hurt Canadian and North American jobs.