Tax & Trade Blog
Scope Rulings - A Useful Tool for Importers!
One of the most difficult aspects of dealing with anti-dumping measures can be figuring out whether goods are caught by an active measure or not. Because appeals in this area are pay-to-play, getting these issues right up front is extremely important!
Luckily, the Special Import Measures Act (“SIMA”) provides a formal process – called a “scope proceeding” – which will determine whether a good is caught by an Order (as well as Findings or Undertakings)!
While the technical aspects of a scope proceeding are complicated, based on historical jurisprudence in this area, many Clients prefer the certainty of a scope proceeding than simply importing on speculation – especially where the potential costs of CBSA taking a different view are measured in one, two and three times of goods sold!
What is a Scope Ruling?
In a scope ruling the Canada Border Services Agency (“CBSA”) will effectively determine whether certain goods are subject to an existing anti-dumping Order or Finding or not. Importers can rely on these rulings when importing their commercial goods to Canada and the ruling will 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!)
Timing is important, however, as the process takes a number of months, and up seven (7) to nine (9) months.
While scope ruling can be 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!
Lastly, it is important to keep in mind that scope rulings do not exclude goods from anti-dumping Orders. Scope proceedings only clarify whether CBSA considers goods to be within the “scope” of existing Orders or Findings (hence the name).
Accordingly there may be situations where it is worthwhile to consider applying to the CITT for an exclusion instead (for example, where a good is technically caught by the overbroad language of an Order but is used for a specific purpose or in an industry where dumping is not actually a concern).
Do you require assistance in this area? If so, please click here.