Steel surtax to be liftedClick image to enlarge

Ottawa has announced that it will be lifting a surtax imposed on five types of foreign steel last October.

When the 25 per cent surtax was imposed as an emergency safeguard to protect Canadian steelmakers, it covered seven types of imported steel: heavy plate, concrete reinforcing bar, energy tubular products, hot-rolled sheet, pre-painted steel, stainless steel wire and wire rod, reports CBC News.

However the Canadian International Trade Tribunal (CITT) has found insufficient evidence to justify most of the safeguards, and they will be removed for hot-rolled sheet, pre-painted steel and wire rod on the grounds that these are not being imported in increased quantities, according to the CITT. The tribunal also found that while concrete reinforcing bar and energy tubular products are being imported in increasing numbers, they are not causing or threatening to cause serious injury.

That will leave the surtax in place on heavy plate and stainless steel wire only. The CITT investigation determined that foreign imports of these categories do represent a genuine threat to the domestic industry.

The terms of the emergency measure allowed Ottawa to apply the surtax first and investigate their merits later. The CITT says it’s one of the most complex investigations it has ever undertaken, with 119 participants submitting over 38,000 pages of evidence to a three-person panel.

The surtax reinforced Canada’s negotiating position with the U.S. after that country imposed heavy tariffs on steel and aluminum being imported into that country. It positioned Ottawa to argue that it was preventing cheap foreign steel from finding its way into the U.S. through Canada – while also protecting Canadian steelmakers from threats posed by cheap foreign steel being dumped here after the U.S. tariffs made that market more difficult to access.

Trade lawyer Cyndee Todgham Cherniak, who represented clients at the inquiry, told CBC News that federal Finance Minister Bill Morneau "moved too quickly to get the duties in place, and now he's got a little bit of egg on his face… It's obvious that they were just doing what the domestic industry had asked them to do."

The surtax will be removed effective April 28. They will remain in place until then, but the government is planning to refund what importers have paid.

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