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TARIFF REMISSION CLAIMS

A RECOMMENDED OPTION FOR BUSINESSES SEEKING TARIFF RELIEF

With the Canada-United States trade dispute enduring, Canada’s retaliatory tariffs are unlikely to be lifted soon.  Many businesses that considered their strategic options have now concluded Remission Claims are the only viable option to deal with Canada’s retaliatory tariffs.  In this Report, we review the Remissions Process, and why retaining Experienced Trade Counsel is a good idea at this early stage.

Dual Remission Frameworks

Canada offers two effective ways to claim Remission for its retaliatory tariffs. First, businesses may make Remission Application pursuant to section 115 of the Customs Tariff (“CT”) under Canada’s general remission framework(the “Remission Framework”).  Second, claims may be made under the United States Surtax Remission Order (2025) (the “Order”) according to specific categories of Remission eligibility.

1. Claims Under The Remission Framework

An individualized Remission Application may be emailed directly to the Department of Finance, but requests will only be considered in the following two instances: 1) to address situations where goods used as inputs cannot be sourced domestically, either on a national or regional basis, or reasonably from non-US sources, and; 2) to address, on a case-by-case basis, other exceptional circumstances that could have severe adverse impacts on the Canadian economy.

2. Remission Claims Under The Order

Provided goods qualify for Remission under the Order, a claim may be made by inputting a special authorization code (“SAC”) into a Commercial According Declaration (“CAD”). Remission may also be claimed after the fact via corrections or adjustments using a SAC.

Section 3 of the Order offers a broad opportunity for relief, as a claim may be made “with respect to any goods imported for use, in Canada, in the manufacture or processing of any good or the packaging of a food product or beverage.” However, the Canada Border Services Agency issued a notice narrowing the Order’s scope.

There remains uncertainty as to what businesses should do if they have concerns about whether they meet the technical requirements of the Order.  Perhaps a Remission Application under section 115 of the CT, claiming Remission under the Order would be appropriate, but obtaining legal advice would be recommended before doing so.

No Right of Appeal

No matter how you look at it, specialized legal advice is highly recommended for any Remission Application Process.  This is largely because there is no current legislative recourse allowing for appeals of a Remission Decision.  Consequently, the only avenue to challenge a Remission Decision is an application for judicial review, which is costly and difficult to make out on a standard of reasonableness. 

The record for judicial review is also based on the record before the administrative body. What this means is that only facts and reasons set out in the original Remission Claim will be considered.  Remission Claims are thus a one-shot deals, which cannot be re-argued after the fact.  The importer is stuck with what is submitted initially!

Takeaways

Canada’s retaliatory tariffs are killing businesses and consumers alike and businesses that have now begun to understand their options for minimizing , or avoiding them are coming to the stark realization that Remission Applications may be their only hope.  Because these applications are effectively one-shot deals with no rights of appeal, retaining Experienced Trade Counsel is generally advisable when trying to put one’s best foot forward in the applications process.

For help with making claims for remission, click here.

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