The countervailing duty process explained

Getting countervailing duties applied to imports believed to be subsidized and/or dumped is a two-pronged process that takes at least seven months.

It starts by the industry being hurt filing a complaint with the Canadian Border Services Agency (CBSA), the agency’s website says.

The application, must represent at least 25 per cent of the Canadian producers affected by the imports and include evidence that the imports are dumped or subsidized.

Dumping occurs when goods exported to Canada are sold at prices lower than in the exporting country or sold at unprofitable prices.

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“Subsidizing occurs when goods imported into Canada benefit from foreign government financial assistance,” the site says. “The amount of subsidizing on imported goods may be offset by the application of countervailing duty.”

Examples of subsidies include loans at preferential rates, grants and tax incentives.

In a separate and independent process the Canadian International Trade Tribunal (CITT) investigates whether alleged dumping of imports are “injuring” or are “threatening to cause injury” to Canadian producers through “reduced prices, lost sales, lost market share, decreased profits and other such difficulties.”

If the CBSA determines there should be an investigation, questionnaires will be sent to exporters, importers and, in subsidy investigations, to the foreign government involved. If necessary CBSA will meet directly with parties to verify the information provided.

To determine if imports are injuring domestic producers, CITT holds public hearings where interested parties, including Canadian producers, importers and foreign exporters, are allowed to present their arguments and question witnesses.

Although separate, CITT and CBSA’s investigations, occur at the same time.

CBSA can impose a provisional duty on imports of dumped or subsidized goods following a preliminary decision of injury by CITT.

CBSA’s preliminary decision of dumping or subsidizing is normally made within three months of the start of the investigation. This temporary duty is intended to protect Canadian producers until CITT makes its final injury decision.

If CITT issues a final injury decision, CBSA imposes anti-dumping or countervailing duties on all imports that are dumped or subsidized for at least five years.


About the author


Allan Dawson

Allan Dawson is a reporter with the Manitoba Co-operator based near Miami, Man. Covering agriculture since 1980, Dawson has spent most of his career with the Co-operator except for several years with Farmers’ Independent Weekly and before that a Morden-Winkler area radio station.



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