Canada Accepting Requests to Avoid Retaliatory Duties on U.S. Goods

The Canadian government is accepting requests for remission of the tariffs imposed on U.S. goods as of July 1 in retaliation for the Trump administration’s duty hike on steel and aluminum products.

Canada’s tariffs include an additional 25 percent duty on steel products classified under various subheadings in Chapter 72 and an additional 10 percent duty on aluminum products as well as other goods such as food products, mattresses, lawn mowers, dishwashers, boats, and various consumer goods. These measures are being imposed in retaliation for, and will remain in place until the elimination of, the higher duties the U.S. imposed June 1 on steel and aluminum products from Canada citing national security concerns.

The Canadian government states that it will consider requests for remission of the additional tariffs (i.e., relief from payment or refund of payments made) only in the following circumstances:

(1) to address situations of short supply in the domestic market, either on a national or regional basis;

(2) where there are contractual requirements, existing prior to May 31, 2018, for Canadian businesses to use U.S. steel or aluminum in their products or projects; and

(3) to address, on a case-by-case basis, other exceptional circumstances that could have severe adverse impacts on the Canadian economy.

Requests must include a substantial amount of information concerning the requesting company, subject goods, import volumes and values, and tariff effects. Requests will go through a detailed review process and the government has set no deadlines for making decisions. Only companies registered in Canada may submit remission requests.

Aside from requesting remissions, companies can use other methods to lower or avoid the Canadian retaliatory tariffs on their products, parts, or SKUs, including reclassification or tariff engineering...

This was excerpted from 18 July 2018 edition of the Sandler, Travis & Rosenberg Trade Report.