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Carbon Steel Fastener Scope Proceeding

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On June 2, 2023, Canada Border Services Agency (“CBSA”) released a notice that it was starting a scope proceeding in respect of carbon steel fasteners originating in or exported from China or Taiwan. The proceeding was initiated by a potential importer, and will confirm whether CAMO Edge Screws are subject to the existing Canadian International Trade Tribunal (“CITT”) anti-dumping Order. The final decision and Statement of Reasons should be available by September 29, 2023.

The Subject Goods are defined in the Order as follows, with a lengthy list of exclusions (and, somewhat more unusually, inclusions) provided in the Order:

"Certain carbon steel fasteners originating in/or exported from the People's Republic of China and Chinese Taipei, excluding those specifically designed for application in the automotive or aerospace industry."

Background

CBSA originally initiated an investigation in respect of the Subject Goods on April 28, 2004. On December 24, 2004, CBSA made a final determination that the Subject Goods were being dumped from China and Taiwan, as well as subsidized in the case of China.

On January 7, 2005, the CITT issued a Finding that dumping of the Subject Goods, as well as subsidizing of Subject Goods (as defined in the Finding) exported from China, had caused injury to the Canadian domestic industry. As a result of this Finding, the anti-dumping duties (“ADDs”) and counter-vailing duties (“CVDs”) previously determined by the CBSA came into effect.

Given the age of these measures, there have been numerous intervening proceedings (such as re-investigations and normal value reviews). The Finding was most recently upheld in the CITT’s Expiry Review decision issued September 2, 2020.

What is a Scope Ruling?

A scope ruling is a decision from CBSA which determines whether certain goods are subject to an anti-dumping Order or Finding issued by the CITT. Importers can rely on these rulings when bringing the goods covered by the scope ruling into Canada, as scope rulings bind the CBSA for goods released on or after the effective date of the ruling. (Notably, unlike Canada Revenue Agency (“CRA”) tax rulings, scope proceedings can be relied upon by other importers – provided the goods at issue are the same of course!)

How Do Scope Proceedings Work?

Under subsection 63(1) of the SIMA, any “interested person” may apply for a scope ruling, with the definition of an interested person being fairly broad. The interested person must then submit a written application to the CBSA, including all required information. CBSA then has 30 days (or 45 days, if an extension is necessary) to decide whether to accept or reject the application.

If the application is accepted, a scope proceeding will begin and CBSA can send requests for information (“RFIs”) to other parties who may have relevant information. CBSA will also notify the applicant (if one exists – notably, under section 64 of the SIMA, CBSA can institute scope proceedings on its own initiative), the government of the country of export, the exporter, the importer, and domestic producers of the initiation of the scope proceeding.

Commentary

While scope rulings are clearly a useful potential tool for preventing problems, they can also be applied to prior determinations and re-determinations. CBSA has recently clarified the procedure for applying a scope ruling to previous determinations or re-determinations – and it may be worth seeking legal advice to determine whether and how a scope ruling could help you!

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