Canada Revokes Duties on Five Steel Products, Imposes Definitive Steel Safeguard Duties on Two

The tit-for-tat war of retaliatory tariffs that was initiated between various countries last year after U.S.’s steep tariffs announcement seems to be fading out.

While U.S. has removed all the levies on steel and aluminum imports coming from Canada and Mexico, Canada has also resolved to remove the retaliatory tariffs imposed on steel imports coming from U.S.

Apart from U.S., the Government of Canada has discontinued its 25% provisional safeguard surtax imposed since October 25, 2018, on imports of five steel products including concrete reinforcing bar, energy tubular products, hot-rolled sheet, pre-painted steel and wire coming from all the countries.

Now, although duties have been removed from five steel products, Canada has confirmed that it will implement definitive safeguard measures on imports of heavy plate and stainless steel wire that the Canadian International Trade Tribunal (CITT) found on April 3, 2019, to have caused or threaten to cause injury to domestic steel producers.

Effective from May 13, 2019, Canada will impose definitive safeguard duties on certain imported heavy plate and stainless steel wire for a period of 3 years. Canada is imposing surtaxes and tariff rate quotas (TRQ) with declining tariff rate and increasing quotas over a three-year period.

However, the TRQs are not prohibitively restrictive and allow a reasonable volume of imports of heavy plate and stainless steel wire in order to meet Canadian supply deficiencies. That being said, as set out below, importers must act quickly (by May 24, 2019) to obtain tariff-free import allocation for imports of heavy plate and stainless steel wire. Importers who do not apply quickly will have to pay the safeguard duties if they want to import heavy plate and/or stainless steel wire.

The Final Steel Safeguards Order applies to Heavy Plate and Stainless Steel Wire (goods) imported from all countries except for:

*Goods originating in Canada;

*Goods originating in Chile, Columbia, Mexico, Panama, Peru, the Republic of Korea, the United States or Israel or another CIFTA beneficiary; and

*Goods originating in a World Trade Organization (WTO) Member country that is a beneficiary of the General Preferential Tariff (GPT), as long as the share of imports from such a country does not exceed 3% of total imports of each good, provided that imports from countries accounting for less than 3% of import share do not collectively account for more than 9% of total imports of each good.

The TRQ and tariff rates for heavy plate is:

The TRQ and tariff rates for steel wire is:

The historical volumes of imports of stainless steel wire into Canada is low.