Bill C-44 “An Act to implement certain provisions of the budget tabled in Parliament on March 22, 2017 and other measures” (also known as “Budget Implementation Act, 2017, No. 1”) has received Royal Assent (on June 22, 2017).  The “other measures” include amendments to the Special Import Measures Act (Canada’s trade remedies law).  The measures include a requirement that the Canada Border Services Agency (“CBSA”) terminate antidumping proceedings if a foreign producer receives a negligible dumping margin during an antidumping investigation.

Subsection 35(1.1) of the Special Import Measures Act (“SIMA”) requires that the President of the CBSA terminate a dumping investigation if, the margin of dumping on any goods of a particular exporter appears to be insignificant (that is, less than 2%) based on the evidence before the President.  Similarly, the President of the CBSA may terminate a subsidy investigation if, the amount of subsidy on any goods of a particular exporter appears to be insignificant based on the evidence before the President.

Canada is bringing SIMA into compliance with Canada’s World Trade Organization obligations.  Subsection 41(1) and (2) of SIMA are amended to grant the President of the CBSA authority to terminate antidumping and subsidy investigations against a particular exporter (SIMA did not previously provide this authority).  Subsection 41(1) of SIMA sets out the general rule:

“(1) Within 90 days after making a preliminary determination under subsection 38(1), the President shall
(a) terminate the investigation in respect of any goods of a particular exporter if, on the available evidence, the President is satisfied that there has been no dumping or subsidizing of the goods or that the margin of dumping of, or amount of subsidy on, those goods is insignificant; and
(b) make a final determination of dumping or subsidizing in respect of the goods that are the subject of the investigation and for which the investigation has not been terminated under paragraph (a) if, on the available evidence, the President is satisfied that there has been dumping or subsidizing and the President shall specify, in relation to each exporter of goods in respect of which the investigation is made, as follows:
(i) in the case of dumped goods, the goods to which the determination applies and the margin of dumping of the goods, and
(ii) in the case of subsidized goods,
(A) the goods to which the determination applies,
(B) the amount of subsidy on the goods, and
(C) subject to subsection (2), if the whole or any part of the subsidy on the goods is a prohibited subsidy, the amount of the prohibited subsidy on the goods.”
Subsection 41(2) of SIMA sets out an exception to the general rule, which is applicable only to export subsidies:
“The President shall not specify anything under clause (1)‍(b)‍(ii)‍(C) if the President is of the opinion that, having regard to the country that is providing the export subsidy, the nature of the goods and the circumstances under which the export subsidy is provided, provision of the export subsidy in relation to those goods is not inconsistent with that country’s obligations under the international agreement known as the General Agreement on Tariffs and Trade, 1994.”
What this means is that exporters/foreign producers have a good reason to participate in Canadian antidumping and CVD proceedings.  If they can show the CBSA that some or all of their exports to Canada were not dumped or subsidized, they will be granted a huge advantage over their competitors – an exclusion from an AD/CVD Order that covers the undumped goods/unsubsidized goods.
Recently, three exporters to Canada received such a benefit.  For example, in the Fabricated Industrial Steel Components case, all goods from Hanmaek Heavy Industries Co., Ltd. and Cintasa, S.A. were excluded from the CITT’s Order. Both of these companies were determined by the CBSA to have insignificant dumping margins (Cintasa S.A. = 0% and Hanmaek = 1.9%).  Other exporters from Korea and Spain are subject to up to 45.8% AD duties.  It is clear that  Hanmaek Heavy Industries Co., Ltd. and Cintasa, S.A. have a competitive advantage as a result of putting in the effort to demonstrate to to the CBSA that they did not dump or did so insignificantly.  In order to be transparent, I acted for Cintasa S.A.  This was the second 0% dumping margin we acheeived for clients in the last 5 years.
In the Rebar case, all goods from Feng Hsin Steel Co., Ltd were excluded from the CITT Order because this company was determined by the CBSA to have not dumped (they received a 0% dumping margin in the dumping investigation).
In the Silicon Metals case, the CBSA recently issued the preliminary determination and two Brazilian exporters have received 0% preliminary dumping margins.  If the on-site verification demonstrates that the calculations are correct, the President of the CBSA will terminate the dumping investigation (the subsidy investigation could continue based on the preliminary calculations).
Participating in antidumping and countervailing proceedings is hard work and significant amounts of data needs to be organized in a short period of time.  The CBSA asks supplemental RFI questions and gives only 7-10 days to respond.  Exporters must be willing to drop everything to provide the requested information.  Usually, the CBSA conducts an on-site verification.  It is best to have counsel present to assist with the provision of requested information during the verification.
If goods were not dumped, this can be proved.  The evidence is there in the books and records.  It is important to provide the necessary data for the CBSA to do their jobs.  The key is to provide complete information.  The key is to not make mistakes in the provision of data.  The key is to communicate clearly.  The key is to understand what the CBSA is requesting and provide that information.  It is important to anticipate questions and be ready to answer those questions. I can tell you that from personal experience acting for exporters, and in particular Cintasa, they worked hard to achieve the good results.  But, the most important fact, that was clear from all of the evidence, they acted fairly and did not dump.  They could prove that their prices (during the period of investigation) were fair prices.  The most senior officials within the organization were committed fully to proving to the CBSA that they did not dump.  The most senior officials worked very hard and were open, honest and transparent with the CBSA.  Their good result in Canada is now a marketing tool for the rest of the world.
For more information about Canada’s trade remedies procedures, please contact Cyndee Todgham Cherniak at 416-307-4168 or at