Safeguard measures, which may be applied by the Government after the Tribunal makes an affirmative determination of serious injury or threat thereof, are intended to assist domestic producers that have suffered, or are threatened by, serious injury from increased levels of imports.

For the Government to apply import safeguard measures, there must be a determination of “unforeseen developments” in addition to a determination of serious injury or threat thereof caused by increased imports.

If the Government directs it to do so, the Tribunal may recommend the most appropriate safeguard measures to apply following an affirmative determination of serious injury or threat thereof. In such cases, the Tribunal’s process is conducted in accordance with the terms of reference directed by the Government and the procedures set out by the Tribunal in the circumstances of the case. This safeguard measures process can occur either concurrently with, or following, the Tribunal’s safeguard inquiry process.

• Recommendations of safeguard measures to the Government

The Tribunal may recommend to the Government safeguard measures in the form of an import surtax or a restriction, such as an import quota or a tariff-rate quota. The Tribunal also has a pivotal role both in the review of any measures that the Government decides to apply, and the issue of whether they should be extended once they are applied by the Government.

• Application of safeguard measures by the Government

The Government may apply safeguard measures on imported goods in the form of an import surtax pursuant to the Customs Tariff or in the form of a restriction (import quota or tariff-rate quota) pursuant to the Export and Import Permits Act to limit the level of imports to prevent or remedy the serious injury, or threat thereof, to domestic producers. An import surtax may be applied on the recommendation of the Minister of Finance, or an import quota or a tariff-rate quota may be applied based on a report to the Minister of Foreign Affairs.

An import surtax is an exceptional customs duty applied to the free-on-board value of imports. An import quota is an absolute limit on the volume of goods that can be imported during a specified time period. A tariff-rate quota is a combination of a quota and a surtax.

There is no statutory deadline for the application of safeguard measures.

Under the WTO Agreement on Safeguards, global safeguard measures may be applied for an initial period of up to four years and are to be progressively liberalized during their period of application. They can be extended, if it is determined that they are still necessary to remedy serious injury or threat thereof and that there is evidence that domestic producers are adjusting to the import competition. The maximum period of application of safeguard measures, including the period of initial application, is eight years. If an initial safeguard measure is to be applied for a period exceeding three years or is extended, the WTO Agreement on Safeguards provides for the maintenance of the level of trade concessions and other obligations between the country applying the measures and countries whose exports are affected. In the absence of an agreement on trade compensation, the government of the country whose exports are affected may, subject to provisions of the WTO Agreement on Safeguards, suspend the application of substantially equivalent trade concessions or other obligations. Global safeguard measures applied to imports from countries with which Canada has entered into bilateral free trade agreements are subject to similar provisions, whatever their duration.

In critical circumstances where delay might result in damage that would be difficult to repair, provisional safeguard measures may, under the WTO Agreement on Safeguards, be applied before there has been a determination of serious injury or threat thereof. The provisional measures must not exceed 200 days and must be in the form of a surtax on imports that is refunded if it is determined that increased imports are not causing and are not threatening to cause serious injury. This period counts as part of the initial period of application of any safeguard measure.

Source: The Canadian International Trade Tribunal