On October 25, 2018, the Government of Canada imposed a provisional safeguard surtax of 25% on imports of certain steel products.

What Steel Products Are Affected By The Surtax?

  1. Heavy plate
  2. Concrete reinforcing bar (rebar)
  3. Energy tubular products
  4. Hot-rolled sheet
  5. Pre-painted steel
  6. Stainless steel wire
  7. Wire rod

A complete description of the products that are subject and their tariff classifications is found on the Department of Finances website.

Canada Announces Commodities Affected By Retaliatory Surtax

What Countries Are Exempt From The Surtax?

  • United States
  • Chile
  • Israel or other beneficiary of the Canada-Israel Free Trade Agreement
  • Mexico However, energy tubular products and wire rod imported from Mexico are subject to the provisional safeguard.
  • Developing countries With the exception of imports of rebar from Vietnam, which are subject to the provisional safeguards.

Are You Eligible To Request Remission Of Canada's New U.S. Surtaxes?

What Are The Exceptions To The Surtax?

There is a specified quantity of these products that can be imported from each country, free from the safeguard surtax, under Tariff Rate Quotas administered by Global Affairs Canada (GAC). A shipment specific import permit must be obtained from GAC prior to final accounting of the Customs entry (within 5 days of customs release). Global Affairs has a Notice to Importers which includes detailed information about tariff rate quota and permits.

Quota will be issued to importers on a first come, first served, shipment-specific basis. Once the quota runs out, permit applications will be rejected and surtax will be applicable to imports of these products.

Canadian Steel And Aluminum Importers Can Receive U.S. Surtax Relief At Time Of Import

What Steps Should An Importer Take?

Review Your Steel Products

Review the steel products you import and compare them to the list on the Department of Finance website. Based on tariff, description and origin, are your steel products subject to the provisional safeguards?

If the products you import are subject to the provisional safeguards, you must advise your customs broker which products fall within the scope, in order to potentially reduce surtaxes by way of Tariff Rate Quotas.

For imports of any subject goods, we recommend copies of your Customs documents are provided a minimum of 48 hours in advance but no more than 5 days in advance of Customs clearance with a request for an import permit. Your Customs documents should include the statement 'Goods Subject to Provisional Safeguards' and an indication of which items are subject.

Is Duty And Surtax The Same Thing?

Obtain Your Export and Imports Permits Act File Number

Ensure your companies Export and Import Permits Act File Number with GAC is open and active, then you are able to apply for a Tariff Rate Quota permits. You can check directly with GAC to determine the status of your file number. Once you have confirmation your file number is active, you can send your customs broker the number to add to your account information.

If the products you import are classified under the tariffs listed and originate in a subject Country but are NOT of the specifications listed, ensure your Customs documents include a detailed description and the statement 'Goods Not Subject to Provisional Safeguards.'

If your Customs documents do not contain enough information to confirm if the products are subject or exempt, contact your customs broker to verify this information prior to final accounting.

Also, if surtaxes are not paid on subject goods at the time of import, CBSA can issue Detailed Adjustment Statements for the additional amounts and interest, as well as fines for non-payment.

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About Author
Gloria Terhaar
CCS, CTCS, CBSA Professional Designate

Gloria Terhaar has over 17 years of Canadian customs brokerage experience. She currently works in our Canadian division as a Trade Compliance Supervisor and Regulatory Compliance Specialist. Gloria has extensive experience in all aspects of documentation and regulatory requirements as they relate to importing products into Canada. Gloria is often called upon to train industry with some recent talks for MNP, the Surrey Board of Trade, TFO Canada and the BC Produce Marketing Association. In 2018, Gloria also participated in the Canadian Produce Marketing Association and the Canadian Horticultural Council advocacy event "Fall Harvest" in Ottawa where she participated in advocacy efforts for the Canadain produce industry.

While we strive for accuracy in all our communications, as the Importer of Record it is incumbent upon your company to ensure that you are aware of the requirements under the new regulations so that you maintain compliance as always.