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Version of document from 2018-10-25 to 2019-02-01:

Order Imposing a Surtax on the Importation of Certain Steel Goods

SOR/2018-206

CUSTOMS TARIFF

Registration 2018-10-11

Order Imposing a Surtax on the Importation of Certain Steel Goods

Whereas the World Trade Organization Agreement on Safeguards allows for the application of a safeguard measure to a good if it is determined that such good is being imported in such increased quantities and under such conditions as to cause or threaten to cause serious injury to the domestic industry that produces like or directly competitive goods;

Whereas the World Trade Organization Agreement on Safeguards further allows for the application of provisional safeguard measures for a 200-day period, in critical circumstances where delay would cause damages difficult to repair;

Whereas it appears to the satisfaction of the Governor in Council, on the basis of a report of the Minister of Finance, that for each class described in the schedule to this Order, all of the steel goods, taken together, are being imported into Canada in increased quantities and have caused or threaten to cause serious injury to domestic producers of like or directly competitive goods;

And whereas, on the basis of the report of the Minister of Finance, it does not appear to the satisfaction of the Governor in Council that the conditions set out in subsection 59(1) of the Customs TariffFootnote a have been met with respect to certain goods imported from Mexico and to goods imported from the United States, Chile, or Israel or another CIFTA beneficiary;

Therefore, Her Excellency the Governor General in Council, on the recommendation of the Minister of Finance, pursuant to subsection 55(1) of the Customs TariffFootnote a, makes the annexed Order Imposing a Surtax on the Importation of Certain Steel Goods.

Marginal note:Origin of the goods

1 For the purposes of this Order, the origin of the goods is determined in accordance with the rules of origin set out in the Determination of Country of Origin for the Purposes of Marking Goods (NAFTA Countries) Regulations or the Determination of Country of Origin for the Purpose of Marking Goods (Non-NAFTA Countries) Regulations, as the case may be.

Marginal note:Application

  • 2 (1) Subject to subsections (2) to (4), this Order applies to goods of a class that is set out in column 1 of the schedule, and that is described in column 2, that are imported from all countries.

  • Marginal note:Exception

    (2) This Order does not apply to goods being imported from the United States, Chile or Israel or another CIFTA beneficiary, and originating in that country.

  • Marginal note:Exception

    (3) This Order does not apply to goods being imported from Mexico, other than those described in classes 3 and 7 of the schedule, and originating in that country.

  • Marginal note:Exception

    (4) This Order does not apply to goods being imported from a country benefiting from the General Preferential Tariff — and originating in that country — for which importation of the goods of the class in question did not, in 2017, exceed 3% of the total importation of goods of that class, provided that the importation of goods of that class from all countries benefiting from that Tariff did not, in 2017, exceed 9% of the total importation of goods of that class.

Marginal note:Surtax

  • 3 (1) Subject to subsections (3) and (4), if all the goods of a class that is set out in column 1 of the schedule, and that is described in column 2, are imported in excess of the quantity referred to in column 3 for that class during one 50-day segment included in the period of 200 days beginning on the day on which this Order comes into force, those goods are subject to a surtax at the rate of 25% of their value for duty, the value for duty being determined in accordance with sections 47 to 55 of the Customs Act.

  • Marginal note:Clarification

    (2) For the purposes of subsection (1), the quantity referred to in column 3 of the schedule applies to four consecutive 50-day segments — the first segment beginning on the day on which this Order comes into force — and any remaining portion of the quantity that is unused at the end of a segment is carried forward into the next segment.

  • Marginal note:Permit

    (3) For the purposes of subsection (1), the goods are considered to be imported in excess of the quantity referred to in column 3 of the schedule if they are not imported under a permit that is issued pursuant to the Export and Import Permits Act in respect of item 82 of the Import Control List and valid at the time at which the goods are accounted for under subsection 32(1), (3) or (5) of the Customs Act.

  • Marginal note:Quantity limit

    (4) For the purposes of subsection (1), the goods are considered to be imported in excess of the quantity referred to in column 3 of the schedule if they originate in a country for which importation of the goods of the class in question exceed the percentage set out in column 5 of the quantity referred to in column 4.

Marginal note:Coming into force

4 This Order comes into force 10 business days after the day on which it is registered.

SCHEDULE(subsections 2(1) and (3) and section 3)

Column 1Column 2Column 3Column 4Column 5
Class of GoodsDescriptionQuantity for 50-day Segment (tonnes)Quantity for 200-day Period (tonnes)Percentage per Country
1. Heavy Plate

Hot-rolled carbon steel plate and high-strength low-alloy steel plate not further manufactured than hot-rolled, heat-treated or not, in widths from 80 inches (± 2,030 mm) to 152 inches (± 3,860 mm, and thicknesses from 0.375 inches (± 9.525 mm) to 4.0 inches (101.6 mm), with all dimensions being plus or minus allowable tolerances contained in the applicable standards. For greater certainty, these dimensional restrictions apply to steel plate, which contains alloys greater than required by recognized industry standards provided that the steel does not meet recognized industry standards for an alloy-specification steel plate.

The following goods are excluded:

  • • 
    all plate in coil form, and
  • • 
    all plate having a rolled, raised figure at regular intervals on the surface (also known as floor plate).
12,91851,67223%
2. Concrete Reinforcing Bar

Hot-rolled deformed steel concrete reinforcing bar in straight lengths or coils, commonly identified as rebar, in various diameters up to 56.4 millimeters, in various finishes.

The following goods are excluded:

  • • 
    plain round bar;
  • • 
    fabricated rebar products; and
  • • 
    10-mm-diameter (10M) rebar produced to meet the requirements of CSA G30 18.09 (or equivalent standards) and that is coated to meet the requirements of epoxy standard ASTM A775/A 775M 04a (or equivalent standards) in lengths from 1 foot (30.48 cm) to 8 feet (243.84 cm).
35,332141,32823%
3. Energy Tubular Products

Carbon and alloy steel energy tubular products, including line pipe, tubing, and casing, finished or unfinished, welded or seamless, having a nominal outside diameter from 2.375 inches (60.3 mm) to 60 inches (1,524 mm) (with all dimensions being plus or minus allowable tolerances contained in the applicable standards), heat treated or not heat treated, regardless of length, wall thickness, surface finish (coated or uncoated), and end finish (plain, bevelled, threaded, or threaded and coupled), in all grades, meeting or supplied to meet American Petroleum Institute (API) 5L, API 5L-B, API 5CT, Canadian Standards Association (CSA) Z245.1, International Standards Organization (ISO) 3183, American Society for Testing and Materials (ASTM) ASTM A333, ASTM A106, ASTM A53-B or their equivalents or enhanced proprietary standards, whether or not actually certified or stenciled, whether or not meeting specifications for other end uses, including single-certified, dual-certified or multiple-certified, for use in oil and gas, piling pipe, or other applications.

For greater certainty, this class includes casing and tubing that are referred to as “green tubes” in the industry. These are formed tubes with the requisite chemistry and dimensions of casing or tubing, but that require further processing before they may be used in a well. They are included in this class as unfinished, non-heat treated, or plain end pipe. The finishing required may be heat treatment, threading, coupling, testing, or any combination of these processes.

The following goods are excluded:

  • • 
    Drill pipe, pup joints, couplings, coupling stock, galvanized or stainless steel line pipe, and casing or tubing containing 10.5% or more by weight chromium;
  • • 
    Submerged arc longitudinal welded line pipe, regardless of grade, outside diameter and wall thickness, in lengths of 60 feet (18.288 m) with no girth welds for exclusive use in slurry or tailings piping systems in oil sands projects and marked “For Use as Slurry/Tailings Pipe Only”. For greater certainty, use in a pipeline meeting CSA Z-662 or as pressure piping meeting CSA B51 Code is not permitted under this exclusion;
  • • 
    Submerged arc longitudinal welded line pipe, regardless of outside diameter, wall thickness and length, for exclusive use in high-temperature steam distribution pipelines and marked “For Steam Distribution Only”, certified to meet the requirements of CSA Z662-15 Clause 14 or Annex I and certified to have proven fatigue and creep test properties as provided in sections I.2.3.2 and I.3.2.1 of CSA Z662-15 as established by means of a creep test of no less than 10,000 hours carried out in accordance with ASTM E139;
  • • 
    Unfinished seamless carbon or alloy steel line pipe in the form of mother tubes having outside diameters of 184, 197, 210, 235, 260, 286, 328, 350, 368, 377, 394, 402, 419, 426, 450, 475, 480, 500, 521, 530, 560, 585 or 610 mm, in wall thicknesses from 9 mm to 110 mm and in lengths ranging from 7.72 m to 15.24 m, not stenciled as meeting any line pipe product specification, but imported for use in the production, and not solely for finishing, of seamless line pipe made to any one or several of API 5L, CSAZ245.1, ISO 3183, ASTM A333, ASTM A335, ASTM A106, ASTM A53 or their equivalents;
  • • 
    ASME SA 672 or ASME SA 691 electric-fusion welded steel pipe as certified under the ASME “Boiler and Pressure Vessel Code” rules (and stencilled with at least one of the aforementioned standards), of a length not to exceed 15 feet (4.572 m), for use other than in a CSA Z-662 pipeline application and imported with authorized inspection certificates and applicable ASME Partial Data Reports;
  • • 
    Line pipe, regardless of grade, outside diameter and wall thickness, single stenciled as “DNV-OS-F101” for exclusive use in offshore applications and marked “For Offshore Applications Only”; and
  • • 
    Welded line pipe having nominal outside diameters from 18 inches to 24 inches (610 mm) (with all dimensions being plus or minus allowable tolerances contained in the applicable standards), regardless of grade and wall thickness, with a manganese content of no less than 16% by weight, for exclusive use in slurry, tailings, and pressure piping systems in oil sands projects, and marked “Not for CSA Z-662 Applications”. For greater certainty, use in a pipeline meeting CSA Z-662 is not permitted under this exclusion.
64,348257,39223%
4. Hot-rolled Sheet

Flat hot-rolled carbon and alloy steel sheet and strip, including secondary or non-prime material, in various widths from 0.75 inches (19 mm) and wider, and

  • • 
    for product in coil form, in thicknesses from 0.054 inches to 0.625 inches (1.37 mm to 15.875 mm),
  • • 
    for product that is cut to length, in thicknesses from 0.054 inches up to but not including 0.187 inches (1.37 mm up to but not including 4.75 mm).

The following goods are excluded:

  • • 
    flat-rolled stainless steel sheet and strip; and
  • • 
    flat hot-rolled, cut to length alloy steel products containing no less than 11.5% manganese, in thicknesses from 0.12 inches to 0.19 inches (3 mm to 4.75 mm).
15,29961,19637%
5. Pre-painted Steel

Pre-painted flat-rolled products of non-alloy and alloy steel (not including stainless steel) which are painted, varnished or coated with plastics on at least one side, in coils or cut lengths, in thicknesses up to 0.079 inches (2.0066 mm) and widths up to 61.5 inches (1562.1 mm) with all dimensions being plus or minus allowable tolerances contained in the applicable standards.

The following goods are excluded:

  • • 
    products with a final coating of zinc-dust (a zinc-rich paint, containing by weight 70% or more of zinc); and
  • • 
    products with a substrate with a metallic coating of chromium.
11,63546,54035%
6. Stainless Steel Wire

Cold drawn and cold drawn and annealed, stainless steel round wire, up to 0.256 inches (6.50 mm) in maximum solid cross-sectional dimension; and cold drawn, and cold drawn and annealed, stainless steel cold-rolled profile wire, up to 0.031 square inches (0.787 sq. mm) in maximum solid cross-sectional area.

4671,86825%
7. Wire Rod

Certain hot‐rolled products of carbon steel and alloy steel, in coils, of approximately round cross section, less than 19.00 mm in actual solid cross‐sectional diameter.

The following goods are excluded:

  • • 
    stainless steel;
  • • 
    tool steel;
  • • 
    high‐nickel steel;
  • • 
    ball bearing steel; and
  • • 
    concrete reinforcing bars and rods (also known as rebar).
11,51346,05247%

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