China Surtax Remission Order (2024): SOR/2025-12
Canada Gazette, Part II, Volume 159, Number 4
Registration
SOR/2025-12 January 31, 2025
CUSTOMS TARIFF
P.C. 2025-54 January 31, 2025
Her Excellency the Governor General in Council, on the recommendation of the Minister of Finance, makes the annexed China Surtax Remission Order (2024) under section 115footnote a of the Customs Tariff footnote b.
China Surtax Remission Order (2024)
Remission
Remission
1 (1) Subject to subsection (2), remission is granted of surtaxes paid or payable under the China Surtax Order (2024) in respect of the goods referred to in Schedule 1 or 2.
Conditions
(2) Remission referred to in subsection (1) is granted on the following conditions:
- (a) in the case of a good referred to in Schedule 1, it is imported into Canada during the period beginning on October 22, 2024 and ending on December 31, 2025;
- (b) in the case of a good referred to in column 3 of Schedule 2 that is classified under the tariff item listed in column 2, it is imported into Canada by an importer listed in column 1 during the period specified in column 4, and any other applicable condition listed in column 5 is met;
- (c) no other claim for relief of the surtax has been granted under the Customs Tariff in respect of the good;
- (d) the good is not subsequently exported to the United States in the same condition in which it was imported; and
- (e) the importer makes a claim for remission to the Minister of Public Safety and Emergency Preparedness within two years after the date of importation.
Coming into Force
Registration
2 This Order comes into force on the day on which it is registered.
SCHEDULE 1
(Subsection 1(1) and paragraph 1(2)(a))
| Item | Column 1 Tariff Item |
Column 2 Description of Goods |
|---|---|---|
| 1 | 7210.70.00 | Pre-painted galvalume coils, of grade 33, of specification ASTM A792 or AZ50 (AZM150), with a thickness of 24 gauge, 26 gauge or 30 gauge, a width of 48 inches and an SMP or PVDF coating |
| 2 | 7212.40.00 | Steel strapping, with open or closed steel sleeves |
| 3 | 7217.10.00 | Non-alloy steel wire, not plated or coated, whether polished or not |
| 4 | 7217.90.00 | Steel black annealed wire coils, rebar tie wire and galvanized black annealed wire coils |
| 5 | 7219.23.00 | Stainless steel sheets and plates, hot-rolled with 2B finish, of type 304 or 304L, with 11 gauge thickness, width of 5 feet, length of 20 feet, of specification ASTM A240 |
| 6 | 7219.23.00 | Stainless steel sheets and plates, hot-rolled with 2B smooth finish, of type 304 or 304L, with 11 gauge thickness, width of 6 feet, length of 12 feet, of specification ASTM A240 |
| 7 | 7219.31.00 | Stainless steel sheets and plates, cold-rolled with 2B smooth finish, of type 304 or 304L, with 3/16 inch thickness, width of 5 feet, length of at least 10 feet but not exceeding 20 feet, of specification ASTM A240 |
| 8 | 7220.20.00 | Flat-rolled stainless steel products, with a width of less than 600 mm, not further worked than cold-rolled (cold-reduced), for use in the production of goods classified under tariff item 7310.10.00 |
| 9 | 7222.11.00.10 | Stainless steel rebar tie wire |
| 10 | 7222.20.00 | Stainless steel metric round bars, of type 304, cold-rolled, h9 tolerance, with an outer diameter of 16 mm, 20 mm, 25 mm, 30 mm, 35 mm, 40 mm, 50 mm or 60 mm, of specification ASTM A276 |
| 11 | 7222.30.00 | Stainless steel metric square bars of 30 mm or 40 mm, of type 304, cold-rolled, of length 4000 mm, of specification ASTM A276 |
| 12 | 7223.00.00 | Stainless steel lashing wire or rebar tie wire |
| 13 | 7223.00.00 | Ultra-fine stainless steel wire, with a diameter of 0.15 mm or 0.28 mm |
| 14 | 7225.11.00 | Silicon grain-oriented steel, with a width of 600 mm or more |
| 15 | 7225.99.00 | Specialty steel products: S-7 VRM steel plates, D-2 VRM steel plates or A-2 VRM steel plates |
| 16 | 7226.11.00 | Silicon grain-oriented steel, with a width of less than 600 mm |
| 17 | 7226.19.00 | Silicon amorphous steel, with a width of less than 600 mm |
| 18 | 7226.99.00 | Specialty steel products of grade 4140, heat-treated, annealed |
| 19 | 7228.30.00 | Round specialty steel products, of the following grades: of grade 4340, heat-treated, of grade 8620, of grade 3312, hot-rolled, annealed, of grade 1045, hot-rolled, of grade 1018, hot-rolled or of grade EN30B |
| 20 | 7228.40.00 | Alloy steel bars and rods |
| 21 | 7228.50.00 | Other bars of other alloy steel, not further worked than cold-formed or cold-finished |
| 22 | 7304.19.00 | Unfinished seamless carbon or alloy steel line pipes in the form of mother tubes with an outside diameter 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, a wall thickness of at least 9 mm but not exceeding 110 mm and a length of at least 7.72 m but not exceeding 15.24 m, not stenciled as meeting any line pipe product specification, but suitable for use in the production, and not solely the finishing, of seamless line pipe made to any one or more of the following specifications: API 5L, CSA Z245.1, ISO 3183, ASTM A333, ASTM A335, ASTM A106, ASTM A53 or their equivalent |
| 23 | 7304.23.00 | Drill pipes, other than of stainless steel, of specification API 5DP or API 7-1 |
| 24 | 7304.29.00.79 | Tubes, pipes and hollow profiles, seamless, of iron — other than cast iron — or steel: coupling stock, with an outside diameter of at least 2.875 inches but not exceeding 37 inches |
| 25 | 7304.59.00.60 | Alloy mechanical tubes of grade 4140 or 4130 Mod, of specification ASTM A519, with an external diameter of at least 3.5 inches but not exceeding 10 inches, a wall thickness of at least 0.3 inches but not exceeding 1.5 inches, and black lacquer protective coating |
| 26 | 7306.40.00.10 | Stainless steel tubes, circular, of type 304L, with an external diameter not exceeding 25.3 mm |
| 27 | 7306.40.00.20 | Stainless steel tubes, circular, of type 304L, with an external diameter exceeding 25.3 mm but not exceeding 114.9 mm |
| 28 | 7306.61.00.39 | Steel tubes — other than galvanized — rectangular, of type 304L, with an external periphery not exceeding 812.8 mm |
| 29 | 7604.21.00 | Aluminum alloy hollow profiles with a powder coating finish on the interior and exterior surfaces |
| 30 | 7604.29.00 | Aluminum alloy bars, rods and profiles: Die #C300X110, Die #C410X110 or Die #1693 |
| 31 | 7605.19.00 | Non-alloyed aluminum wire, with
cross-sectional dimension not exceeding 7 mm, of grade AL-1350, compliant with the chemical requirements referred to in Table 2 of specification ASTM B233-97, of any of the following dimensions:
|
| 32 | 7606.11.00 | Non-alloyed aluminum plates, sheets and strip, with a thickness exceeding 0.2 mm, rectangular, compliant with specification ASTM B209 or equivalent industry specifications, flat 2 mm per metre in all directions, with diagonals that do not measure a difference of more than 4 mm, no visible ripples on any sheet and no scratches, gouges or residual oils |
| 33 | 7606.11.00 | Non-alloyed aluminum plates, sheets and strip, with a thickness exceeding 0.2 mm, rectangular, used as cathode sheets in zinc electrowinning processes |
| 34 | 7606.11.00 | Non-alloyed aluminum plates, sheets and strip, rectangular, of grade 1050 Aluminum "O" Coil or grade 1350 Aluminum "O" Coil, compliant with the chemical requirements of specification ASTM B233-97, with a thickness of at least 0.020 inches but not exceeding 0.060 inches, a width of at least 2 inches but not exceeding 33.5 inches, and a mill finish |
| 35 | 7606.12.00 | Aluminum alloy plates, sheets and strip, of a thickness exceeding 0.2 mm, rectangular |
| 36 | 7606.12.00.11 | Aluminum checker plate sheets of alloy 3003, with a base thickness of 4 mm, width of 4 feet and length of 10 feet |
| 37 | 7606.12.00.11 | Pre-painted aluminum coils, 3003–H24 with 8 or 12 µ polyester coating in black, brown or white, with a thickness of 0.5 mm and width of 610 mm |
| 38 | 7606.12.00.12 | Aluminum alloy plates, sheets and strip, with a thickness of 7 mm or more, rectangular, not clad, compliant with specification ASTM B209 or equivalent industry specifications, flat 2 mm per metre in all directions, with diagonals that do not measure a difference of more than 4 mm, no visible ripples on any sheet and no scratches, gouges or residual oils |
| 39 | 7607.19.00.00 | Aluminum foil, with a thickness not exceeding 0.2 mm, not backed, other than rolled but not further worked, of alloys 3003, 3004, 3104, 8011 or 8111 |
| 40 | 7609.00.00 | Aluminum tube or pipe fittings, of the following specifications:
|
Note If the description in column 2 covers only a subset of goods classified under the tariff item referred to in column 1, remission is granted only for the goods described in column 2.
SCHEDULE 2
(Subsection 1(1) and paragraph 1(2)(b))
| Item | Column 1 Business Number |
Column 2 Tariff Item |
Column 3 Description of Goods |
Column 4 Period |
Column 5 Conditions |
|---|---|---|---|---|---|
| 1 | 102645082 | 7607.11.00 | Aluminum foil, with a thickness not exceeding 0.2 mm, not backed, rolled but not further worked | From October 22, 2024 to December 31, 2025 | |
| 2 | 119446847 | 7228.30.00.72 | Hot-rolled steel bars, of special bar quality | From October 22, 2024 to December 31, 2025 | |
| 3 | 122960222 | 7606.91.00.10 | Aluminum plates, sheets and strip, with a thickness exceeding 0.2 mm, circular, with circumference from at least 6 inches but not exceeding 20 inches | From October 22, 2024 to December 31, 2025 | |
| 4 | 137864229 | 7305.31.00 | Coated permanent steel piles, longitudinally welded, with a pipe outer diameter of 1.219 m, a thickness of 25.4 mm and lengths not exceeding 95 m | From October 22, 2024 to December 31, 2025 | |
| 7305.39.00 | Temporary steel piles, spiral welded, with a pipe outer diameter of 1.067 m, and a length of at least 41 m but not exceeding 72 m | ||||
| 5 | 709514509 | 7304.39.00 |
|
From October 22, 2024 to December 31, 2025 | |
| 6 | 729240341 | 7606.12.00 | Flat-rolled aerospace-grade aluminum, of alloys 7475, 7075 or 2024 | From October 22, 2024 to December 31, 2025 | Imported for sale to company with business number 871361366 |
| 7 | 729240341 | 7606.12.00.12 | Aluminum alloy plates, sheets and strip, rectangular, not clad, with a thickness of 7 mm or more | From October 22, 2024 to March 31, 2025 | Imported for sale to company with business number 861072163 |
| 8 | 736401290 | 7223.00.00.90 | Stainless steel profile wire with a solid cross-sectional area greater than 0.787 mm2 | From October 22, 2024 to December 31, 2025 | |
| 7306.40.00.10 | Stainless steel capillary line | ||||
| 9 | 737151720 | 7604.21.00.10 | Aluminum hollow profiles, unworked | From October 22, 2024 to December 31, 2025 | |
| 7606.12.00.20 | Aluminum alloy plates, sheets and strip, with a thickness exceeding 0.2 mm, rectangular, clad | ||||
| 10 | 758833297 | 7210.70.00.90 | Pre-painted steel coils PPGI or PPGL, with a thickness of at least 0.37 mm but not exceeding 0.45 mm, AZ100 g/m2 with polyester and epoxy coating in black or brown, and a width of at least 590 mm but not exceeding 1220 mm | From October 22, 2024 to December 31, 2025 | |
| 11 | 761094119 | 7607.11.00 | Aluminum foil, with a thickness not exceeding 0.2 mm, not backed, rolled but not further worked | For goods imported on or after October 22, 2024 | |
| 12 | 774083737 | 8703.40.90 | Non-plug-in hybrid passenger vehicles, with both a spark-ignition internal combustion piston engine and an electric motor for propulsion, with a cylinder capacity of 1000 cm3 or more | For goods imported on or after October 22, 2024 | Remission limited to a maximum of 554 vehicles |
| 13 | 778340406 | 7606.12.00.20 | Aluminum sheets, with a thickness exceeding 0.2 mm, rectangular, clad, of alloy 3003 or 4045 | From October 22, 2024 to December 31, 2025 | |
| 7606.92.00.00 | Aluminum plates, sheets and strip, with a thickness exceeding 0.2 mm, other than rectangular, of alloy 4043, 4045, 3003, 3005 or 7072 | ||||
| 7607.11.00.20 | Aluminum foil, not backed, rolled but not further worked, with a thickness of 0.005 mm or more but less than 0.127 mm, of alloy 3003 | ||||
| 14 | 782889604 | 7210.12.00 | Electrolytic tinplate of iron or non-alloy steel, batch annealed materials or box annealed materials, with a thickness of less than 0.50 mm and width of more than over 600 mm | From October 22, 2024 to December 31, 2025 | Imported for sale to company with business number 104708409 |
| 15 | 808739577 | 7607.11.00 | Aluminum foil, with a thickness not exceeding 0.2 mm, not backed, rolled but not further worked | From October 22, 2024 to December 31, 2025 | |
| 16 | 842474249 | 7217.10.00.43 | Spring wire, with a diameter of 1.0 mm or more but less than 1.5 mm | From October 22, 2024 to December 31, 2025 | |
| 7217.10.00.44 | Spring wire, with a diameter of 1.5 mm or more but less than 3 mm | ||||
| 17 | 858299928 | 7606.91.00 | Aluminum plates, sheets and strip, with a thickness exceeding 0.2 mm, other than rectangular, non-alloyed, of the 1000, 5000 or 8000 series | From October 22, 2024 to December 31, 2025 | |
| 7606.92.00 | Aluminum plates, sheets and strip, with a thickness exceeding 0.2 mm, other than rectangular, alloyed, of the 1000, 5000 or 8000 series | ||||
| 7607.11.00 | Aluminum foil, with a thickness not exceeding 0.2 mm, not backed, rolled but not further worked, of the 1000, 5000 or 8000 series | ||||
| 7607.19.00 | Aluminum foil, with a thickness not exceeding 0.2 mm, not backed, other than rolled but not further worked, of the 1000, 5000 or 8000 series | ||||
| 18 | 861072163 | 7606.12.00.12 | Aluminum alloy plates, sheets and strip, rectangular, not clad, with a thickness of 7 mm or more | From April 1, 2025 to December 31, 2025 | |
| 19 | 861206423 | 7306.50.00.00 | Steel tubes, circular, cold-rolled, of specification ASTM A500 gr A | From October 22, 2024 to December 31, 2025 | |
| 7306.61.00.39 | Steel tubes, rectangular, cold-rolled, of specification ASTM A500 gr A | ||||
| 7306.69.00.39 | Steel tubes, oval, of specification ASTM A500 gr A | ||||
| 20 | 863579827 | 7607.11.00 | Aluminum foil, with a thickness not exceeding 0.2 mm, not backed, rolled but not further worked | From October 22, 2024 to December 31, 2025 | |
| 21 | 872321203 | 7606.12.00 | Aluminum alloy plates, sheets and strip, with a thickness exceeding 0.2 mm, rectangular | From October 22, 2024 to December 31, 2025 | |
| 22 | 872889514 | 7228.40.00 | Steel bars with an outer diameters of at least 7.1 inches but not exceeding 26.6 inches, of grade 4130, of specification API 6A | From October 22, 2024 to December 31, 2025 | |
| 23 | 876686320 | 7607.11.00 | Aluminum foil, with a thickness not exceeding 0.2 mm, not backed, rolled but not further worked | From October 22, 2024 to December 31, 2025 | |
| 24 | 882092562 | 7219.90.00 | #301 Full Hard Stainless Steel coil, with thickness of 0.02 inches (0.5 mm), width of 1 inch (25 mm), grounded edges, purchased in large coils | From October 22, 2024 to October 21, 2025 | |
| 25 | 896964400 | 7219.90.00 |
|
From October 22, 2024 to July 31, 2026 | |
| 7606.12.00 |
|
||||
| 26 | 899771042 | 7606.12.00 | Pre-painted aluminum coil, of alloy 3003 or 3105, with a thickness of 0.012 inches, 0.017 inches, 0.0234 inches, 0.027 inches or 0.32 inches | From October 22, 2024 to December 31, 2025 | Imported for sale to company with business number 100980127 |
Note If the description in column 3 covers only a subset of goods classified under the tariff item referred to in column 2, remission is granted only for the goods described in column 3.
REGULATORY IMPACT ANALYSIS STATEMENT
(This statement is not part of the Order.)
Issues
The Government of Canada recently imposed surtaxes on Chinese-made electric vehicles as well as Chinese-made steel and aluminum products. During consultations held before the imposition of these measures, Canadian stakeholders confirmed that exceptional measures were required to address the extraordinary threat from Chinese producers. However, some stakeholders noted concerns with challenges in adjusting supply chains before the measures entered into force. On October 18, 2024, the Government indicated it would consider remission requests related to these surtaxes on Chinese-made goods.
Background
The Government of Canada imposed a 100% surtax on Chinese-made electric vehicles on October 1, 2024, and a 25% surtax on Chinese-made steel and aluminum products on October 22, 2024. These surtaxes are implemented through the China Surtax Order (2024), made pursuant to section 53 of the Customs Tariff. Public consultations held before the surtaxes went into force confirmed stakeholder support for these exceptional measures. However, some stakeholders also noted concerns with their ability to shift supply chains before the surtaxes entered into force due to factors such as no or limited alternative sources of supply (short supply), the requirement for certain products used as inputs to comply with certification requirements, or contractual obligations requiring Canadian businesses to purchase Chinese inputs in their products or projects for a specified period of time.
To ensure Canadian industry has time to adjust supply chains, on October 18, 2024, the Government outlined a framework and process under which it would consider remission requests related to these surtaxes on Chinese-made goods. Under specific circumstances, remission allows for relief from the payment of surtaxes, or the refund of surtaxes already paid.
Remission represents an exception to the rules by providing for relief of otherwise applicable duties or surtaxes. As a result, remission of surtaxes is made available in compelling circumstances in line with the rationale behind the application of the surtaxes — levelling the playing field for Canadian workers and businesses — while ensuring they are not unduly burdened as they adjust supply chains.
The Government considers requests for remission of surtaxes in the following instances:
- Situations where goods used as inputs, or substitutes for those goods, cannot be reasonably sourced either domestically or from non-Chinese sources;
- Where there are contractual obligations, existing prior to August 26, 2024, requiring Canadian businesses to purchase Chinese inputs into their products or projects for a specified period of time; and
- Other exceptional circumstances, on a case-by-case basis, that could have significant adverse impacts on the Canadian economy.
Remission will not be granted for goods intended for resale in the same condition to the United States.
Section 115 of the Customs Tariff provides the authority for the Governor in Council to remit surtaxes on the recommendation of the Minister of Finance.
Objective
The Remission Order provides relief from surtaxes in exceptional situations to ensure that Canadian companies have time to adjust supply chains, such as where goods are not available in Canada or reasonably from non-Chinese sources, or are subject to certain pre-existing contractual obligations that require Canadian businesses to purchase Chinese inputs for a specified period of time. As announced by the Government on October 18, 2024, this Order covers those applications for remission that were received before November 8, 2024, which were prioritized for initial review that was completed in all cases where the information provided was complete and fully substantiated. The Government will continue to consider applications for remission requests received November 8 and later.
Description
Pursuant to section 115 of the Customs Tariff, the China Surtax Remission Order (2024) [the Order or the Remission Order] remits, in regard to specified goods imported from China, surtaxes paid or payable under the China Surtax Order (2024). Remission requests were considered to ensure that Canadian workers and businesses are not unduly burdened by surtaxes on imports from China, especially in the following instances:
- Cases where there is evidence of short supply: where goods used as inputs, or substitutes for those goods, cannot be reasonably sourced either domestically or from non-Chinese sources in the foreseeable future;
- Where contractual obligations, existing prior to August 26, 2024, require Canadian businesses to purchase Chinese inputs in their products or projects for a specified period of time; and
- Other exceptional circumstances, including where industries may require lead time when transitioning to new suppliers, in order to ensure new suppliers can meet all necessary production standards and certifications.
Remission is extended to goods classified under a tariff item listed in schedules 1 and 2 to the Order and meeting the descriptions associated with that tariff item. Descriptions pertain, as applicable, to product characteristics such as dimensions, grades, and technical specifications.
Goods listed in Schedule 1 have been determined to be in temporary situations of short supply. Determination of short supply was based on submissions and consultations with importers and producers that use the goods, as well as Canadian suppliers of the goods in question. Beginning on October 22, 2024, remission of surtaxes for those goods is provided for a period ending on December 31, 2025, and is available to all importers. The period of remission for any particular good may be extended, as appropriate, should short supply conditions be determined to persist.
Schedule 2 covers situations where contractual obligations existed prior to August 26, 2024, requiring the use of Chinese steel or aluminum in products or projects, or where other exceptional circumstances limit the feasibility of resourcing. Remission under Schedule 2 is available to those companies specifically identified by their business numbers in column 1 of Schedule 2, for the products identified in columns 2 and 3, under the time periods set out in column 4, and meeting the conditions set out in column 5, where applicable.
Overall, schedules 1 and 2 cover multiple steel goods including certain plates, hot-rolled and cold-rolled sheets, bars, rods, pipes, tubes, wire and stainless-steel products. Aluminum goods include plates, sheets, strips, coils, foil, rolls, tubes, bars, rods and pipes. Schedule 2 also includes remission for certain electric vehicles for one specifically identified company.
The Order sets out the conditions for granting remission, including that the goods not be resold to the United States in the same condition in which they were imported, and that the requesting importer make a claim to the Minister of Public Safety and Emergency Preparedness within two years after the date of importation.
Regulatory development
Consultation
Public consultations were held between July 2 and August 1, 2024, on potential policy responses to unfair Chinese trade practices in electric vehicles, including on the imposition of a surtax on electric vehicles pursuant to section 53 of the Customs Tariff. In addition, a comment period was held between August 26 and September 20, 2024, following the issuance of a Notice of intent to apply a surtax on Chinese-made steel and aluminum products.
On October 18, 2024, the Government of Canada published on the Department of Finance’s website a notice explaining the framework and process under which remissions could be provided for surtaxes imposed, through the China Surtax Order (2024), on imports from China. The notice stated that remission requests received before November 8, 2024, would be processed on a priority basis.
The notice provided a template that companies registered in Canada could use to submit requests for remission, to ensure that requests were properly substantiated and included the information necessary for assessment. Requests were subject to review by the Department of Finance, in consultation with other relevant federal departments as well as domestic producers, to assess the merits of providing remission, in order to make recommendations to the Minister of Finance.
Submissions and remission requests generally highlighted the inability to avoid the surtaxes due to the following considerations, among others:
- For certain specific steel and aluminum goods (e.g. specific dimensions, product composition, compliance with technical standards, quality requirements), China is the only reasonable source of supply;
- Inability to switch source of supply as a result of customer requirements to use pre-approved materials from designated Chinese suppliers (notably in the automotive and aerospace industries); and
- Existing contractual obligations to buy from Chinese suppliers.
While the Remission Order covers successful submissions that were received before November 8, the Government will also notify stakeholders whose remission requests were not approved. The Government will continue to consider remission requests related to the China Surtax Order (2024). Should the Government decide to impose additional surtaxes on other Chinese goods, a similar remission process would become available for those goods.
Modern treaty obligations and Indigenous engagement and consultation
Following the completion of the assessment of modern treaty implications, no adverse impacts on potential or established Indigenous or treaty rights, which are recognized and affirmed in section 35 of the Constitution Act, 1982, were identified in the Order.
Instrument choice
Section 115 of the Customs Tariff provides the authority for the Governor in Council to remit duties on the recommendation of the Minister of Finance. A Remission Order under section 115 of the Customs Tariff is the most appropriate mechanism, as it was created to provide remission from duties, including surtaxes.
Regulatory analysis
Benefits and costs
In accordance with the criteria that have been set out, remission will be provided where warranted by conditions of short supply, pre-existing contractual obligations and exceptional circumstances requiring lead time for Canadian businesses to adjust their supply chains to the surtaxes.
This Order is a relieving mechanism to the benefit of industry impacted by the China surtaxes. The administrative costs for Canadian businesses to claim remission of the surtaxes are expected to be limited.
Items listed in Schedule 1 are goods that are used as inputs for further manufacturing in Canada and are not readily available from any other alternative sources globally. In the absence of remission, Canadian businesses that use these goods would have to pay the surtax, which would increase production costs. Depending on the product, these costs could ultimately be passed on to Canadian consumers. Schedule 1 mitigates this issue by providing temporary remission for such goods, regardless of the importer or the company using them.
Goods listed in Schedule 2 have been identified as items for which a contract is already in place, or for which companies have found alternative sources, although more time is required to complete the process of switching suppliers. In these cases, remission allows additional time for companies to fulfill original contracts or switch suppliers without incurring extra costs.
Remission claims for imports after the date of entry into force of this Order would be made for each applicable importation as part of the process of filling existing customs documentation requirements. The importer will be required to include one extra code on their usual import document. The importer must also maintain records supporting their importation (e.g. related to tariff classification, entitlement to a tariff preference, entitlement to the remission), but this is the usual process and does not represent an additional cost. There would be minimal incremental costs for the Government to process the claims.
Importers requesting a refund for goods imported prior to the entry into force of this Order will submit forms to the Canada Border Services Agency (CBSA), accompanied by supporting documentation, establishing that the imported goods qualify for remission. There would be minimal incremental costs for industry to supply the documentation and for the Government to process the claims.
Small business lens
Analysis under the small business lens concluded that the Order will impact small businesses. Some of the importers meet the definition of “small business” in the Policy on Limiting Regulatory Burden on Business, and the process to claim remission of duties paid meets the definition of “administrative burden” set out in the Policy. No additional flexibility is necessary for small businesses claiming remission, as all eligible importers already possess the original customs forms required to justify remission and will benefit from the remitted funds.
One-for-one rule
This Order relates to tax administration and is exempt from the requirement to offset administrative burden and regulatory titles under the one-for-one rule. The requirement for Canadian importers to submit claims for remission meets the Red Tape Reduction Act definition of administrative burden on businesses. However, duties are considered to be “taxes” for the purpose of the one-for-one rule and have been exempted from the offset requirement.
Regulatory cooperation and alignment
Canada’s like-minded trading partners, including the United States (U.S.) and the European Union, have identified similar concerns and are taking steps to protect their markets. In particular, the U.S., which has imposed section 301 tariffs applicable to Chinese electric vehicles and steel and aluminum products among other strategic sectors, has also implemented an exclusion process to provide relief from section 301 tariffs under certain circumstances. The U.S. process granted time-limited exclusions to specific companies on a product basis, retroactive to the date that tariffs were imposed. In some cases, extensions were granted.
Effects on the environment
In accordance with the Cabinet Directive on Strategic Environmental and Economic Assessment (SEEA Directive), a preliminary scan concluded that a strategic environmental and economic assessment is not required.
Gender-based analysis plus
No impacts based on gender and other identity factors have been identified for this Order.
Implementation, compliance and enforcement, and service standards
Once the Order enters into force, the CBSA will publish a customs notice detailing how eligible businesses may claim remission. The CBSA will assess any requests for remission made pursuant to the Order and will ensure compliance with its terms and conditions in the normal course of its administration of customs and tariff-related legislation and regulations. In doing so, the existing administrative framework will be leveraged to ensure that costs can be managed within existing resources. Any refund issued pursuant to the Order will be administered by the CBSA. Depending on the volumes and complexity of refund submissions, the CBSA strives to achieve a 90-day processing standard.
Contact
Mike Mosier
Director
Trade and Tariff Policy
International Trade Policy Division
Department of Finance
Ottawa, Ontario
K1A 0G5
Email: tariff-tarif@fin.gc.ca