Order Imposing a Surtax on the Importation of Certain Steel Goods
SOR/2018-206
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.
Return to footnote aS.C. 1997, c. 36
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 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 described in classes 1, 2 and 4 to 6 of Schedule 1 being imported from Mexico and originating in that country.
Marginal note:Exception
(3.1) This Order does not apply to goods originating in Canada.
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 — other than goods originating in Mexico
3 (1) Subject to subsection (2), if all the goods of a class, other than goods originating in Mexico, that is set out in column 1 of Schedule 1, and that is described in column 2, are imported in excess of the following quantity during one of the four consecutive 50-day segments included in the period of 200 days beginning on October 25, 2018 — the first segment beginning on that date — any such 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:
(a) for goods of classes 1, 2 or 4 to 7, the quantity referred to in column 3 of Schedule 1; and
(b) for goods of class 3, the quantity calculated in accordance with the formula
(A – B)/2
where
- A
- is the quantity referred to in column 4 of Schedule 1 for class 3; and
- B
- is the quantity of goods, other than goods originating in Mexico, imported under an import permit issued under the Export and Import Permits Act in respect of item 82 of the Import Control List during the period beginning on October 25, 2018 and ending on the day on which this section comes into force.
Marginal note:Reduction of quantity
(2) For the 50-day segment during which this section comes into force, the quantity referred to in paragraph (1)(a) or the quantity calculated in accordance with the formula set out in paragraph (1)(b), as the case may be, is reduced by the quantity of goods, other than goods originating in Mexico, imported under an import permit issued under the Export and Import Permits Act in respect of item 82 of the Import Control List during the period beginning on the first day of that segment and ending on the day on which this section comes into force.
Marginal note:Unused portion of quantity
(3) For the purposes of this section, any remaining portion of the quantity that is unused at the end of a 50-day segment is carried forward into the next segment.
Marginal note:Permit
(4) For the purposes of subsection (1), the goods are considered to be imported in excess of the quantity referred to in paragraph (1)(a) or the quantity calculated in accordance with the formula set out in paragraph (1)(b), as the case may be, if they are not imported under an import permit that is issued under 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
(5) For the purposes of subsection (1), the goods are considered to be imported in excess of the quantity referred to in paragraph (1)(a) or the quantity calculated in accordance with the formula set out in paragraph (1)(b), as the case may be, if they originate in a country for which importation of the goods of the class in question, during the period of 200 days beginning on October 25, 2018, exceeds the percentage set out in column 5 of Schedule 1 of the following quantity:
(a) for goods of classes 1 to 6, the quantity referred to in column 4; and
(b) for goods of class 7, the sum of
(i) the quantity of goods, other than goods originating in Mexico, imported under an import permit issued under the Export and Import Permits Act in respect of item 82 of the Import Control List during the period beginning on October 25, 2018 and ending on the day on which this section comes into force, and
(ii) the quantity referred to in paragraph (1)(a) or subsection (2), as the case may be, for the segment during which this section comes into force and any remaining segment.
Marginal note:Surtax — goods originating in Mexico
3.1 (1) If all the goods, originating in Mexico, of a class that is set out in column 1 of Schedule 2, and that is described in column 2, are imported in excess of the quantity referred to in subsection (2) during the period beginning on the day on which this section comes into force and ending at the end of the period of 200 days beginning on October 25, 2018, any such 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:Reduction of quantity
(2) For the purposes of subsection (1), the quantity is the quantity referred to in column 3 of Schedule 2, after deduction of the quantity of goods originating in Mexico imported under an import permit issued under the Export and Import Permits Act in respect of item 82 of the Import Control List during the period beginning on October 25, 2018 and ending on the day on which this section comes into force.
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 subsection (2) if they are not imported under an import permit that is issued under 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:Coming into force
4 This Order comes into force 10 business days after the day on which it is registered.
SCHEDULE 1(Subsections 2(3) and 3(1) and (5))
| Column 1 | Column 2 | Column 3 | Column 4 | Column 5 |
|---|---|---|---|---|
| Class of Goods | Description | Quantity 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:
| 12,918 | 51,672 | 23% |
| 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:
| 35,332 | 141,328 | 23% |
| 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:
| N/A | 200,699 | 30% |
| 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
The following goods are excluded:
| 15,299 | 61,196 | 37% |
| 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:
| 11,635 | 46,540 | 35% |
| 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. | 467 | 1,868 | 25% |
| 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:
| 7,319 | N/A | 74% |
SCHEDULE 2(Subsections 3.1(1) and (2))
| Column 1 | Column 2 | Column 3 |
|---|---|---|
| Class of Goods | Description | Quantity for 200-day Period (tonnes) |
| 1. 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:
| 72,820 |
| 2. 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:
| 16,776 |
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