Government of Canada Stands Up for Steel and Aluminum Businesses and Workers

October 11, 2018 – Ottawa, Ontario – Department of Finance Canada

As part of its ongoing efforts to stand up for Canada's steel industry and support Canadian workers and businesses, today the Government of Canada is announcing further steps to prevent diversion of foreign steel products into Canada, and provide relief to steel and aluminum users in specific circumstances that are paying for countermeasures on certain products imported from the United States.

Canada's response began on July 1, 2018, when the Government began applying measured reciprocal countermeasures on $16.6 billion of imports of steel, aluminum, and other products from the U.S., in response to the unjustified and counterproductive U.S. tariffs on Canadian steel and aluminum.

The measures below offer a balanced response that will support Canadian producers and manufacturers, while the Government continues to work toward the complete repeal of all U.S. tariffs of Canadian steel and aluminum.

Support for Companies

Given the longstanding integration of Canada-U.S. supply chains, the Government recognizes that Canadian countermeasures against U.S. imports can create challenges for Canadian manufacturers that rely on steel and aluminum imported from the United States. In light of this, the Government established a process for Canadian companies to request targeted relief from countermeasures under extraordinary circumstances, such as a lack of supply in the domestic market.

Today, the Government announced targeted relief from surtaxes collected on steel, aluminum and certain other products imported from the U.S. since July 1, 2018. Companies that have applied for and been granted relief can now import these goods without paying surtaxes. A portion of this relief will be temporary, offered until such time that Canadian producers are able to adequately meet domestic demand.

Relief is only provided where warranted by exceptional circumstances, and Canadian countermeasures on U.S. imports continue to apply. The Government will continue to assess, on a case-by-case basis, relief applications based on market conditions including supply shortages.

The Government will also create a committee that will make it easier for all relevant stakeholders to provide their views on requests for relief from countermeasures.

Safeguards

Recognizing the harm that diversion of foreign steel products into Canada may cause to Canadian steel producers and workers, and in response to recent consultations and evidence that diversion is occurring, the Government today announced provisional safeguard measures on seven steel products: heavy plate, concrete reinforcing bar, energy tubular products, hot-rolled sheet, pre-painted steel, stainless steel wire, and wire rod.

Safeguards are trade measures imposed under international trade rules in exceptional circumstances to respond to increases in imports that may harm Canadian producers and workers.

Beginning October 25, 2018, imports of these seven steel products will be subject to a surtax of 25 per cent, in cases where the level of imports from trading partners exceeds historical norms.

Provisional safeguards are intended to provide Canadian steel producers and workers relief from the harm caused by excessive imports of steel products into Canada. The Government is requesting that the Canadian International Trade Tribunal (CITT) conduct an inquiry to determine whether final safeguards are warranted. The provisional safeguards will be in place for 200 days pending the CITT's findings.

The Government will continue to work with stakeholders to monitor steel imports and supply conditions in Canada.

On October 16, Finance Minister Bill Morneau will appear before the House of Commons Standing Committee on International Trade as part of its study of the impact of tariffs on Canadian businesses, companies and workers.