WTO/FTA咨询网

Trade Policy Review of Canada

-- Questions from China

Trade Policies and Practices by Measures

        Measures Directly Affecting Imports

Tariffs

1. Canada still maintains fairly high tariffs on some products. High tariff is still a major barrier to the export of textiles, especially clothing, to Canada. For example, tariffs on wool and synthetic fiber is 16%, and those on clothing are from 17.5% to 21%. Besides, tariffs on vessels and some safety apparatus for ice hockey are fairly high as well.

(1)     Could Canada please explain the reason for maintaining tariff peaks in these sectors?

(2)     Does Canada have any plan to lower them?

2. Canada still applies tariff quotas to some agricultural products, including eggs and egg products, milk, turkey and turkey products, beef, chicken and chicken products, etc. For example, the out-of-quota tariff rate on imported milk is 243% with the tariff rate not lower than CAN$2.82 per kilo. For other dairy foods for smearing, the out-of-quota tariff rate is as high as 313.5% and those on meat and edible offal of the poultry (fresh, chilled or frozen) are as high as 154.5% and 238%.

(1)   Could Canada please explain the reason for maintaining such high out-of-quota tariff rates on these agricultural products?

(2)   Does Canada have any plan to lower them?

Quantitative restrictions and licensing

3. The import and inter-provincial trade of alcoholic beverage in Canada are subject to the Importation of Intoxicating Liquors Act, which gives provinces much discretion over the sale, import and inter-provincial transportation of spirits. Currently, PLB is the sole agency to exercise the above policies, which include: imposing a higher mark-up on imported products than on domestic like products; setting floor and ceiling prices on imported products; etc.

(1)   Please explain the reasons for adopting these measures?

(2)   What is the basis on which the PLB sets floor and ceiling prices on imported products?

(3)   Please explain the conformity of the above policies with the national treatment principle of the WTO?

Contingency Measures

4. Sections 30.2-32.22 of the Canadian International Trade Tribunal Act provides for the procedures regarding special safeguard and temporary safeguard measures against imports of specific Chinese products.

(1)     Please elaborate the rationale and basis for the low threshold to initiate investigations.

(2)     Please explain why the procedures lack specific provisions on consultation, hearing and confidentiality.

(3)     What are the criteria used in the Act to determine the existence of market disruption and trade diversion?

5. Canada’s Special Import Measures Act (SIMA) and Chapter 2 and 3 of Special Import Measures Regulations contain specific provisions regarding the amount of subsidy and the initiation, investigation and determination.

The simplicity of the Act’s provisions regarding the existence, amount and nature of a subsidy, particularly on the burden of proof on complainants, tend to result in an easy determination of the existence of a subsidy.

Could Canada please explain their consistency with Article 11.2(ii) of the ASCM?

6. On November 3^rd, 2006, CBSA issued the Statement of Reasons for the preliminary determination regarding the countervailing investigation against copper pipe fittings. While calculating the subsidy amount, CBSA estimated the amount through comparing the average export price of the products under investigation with the production costs provided by Canadian complainants.

(1)     Could Canada please explain the reason not to take into account the information provided by the Chinese side?

(2)     CBSA used a “constructed price” similar to that used in antidumping investigations in calculating amount of the subsidy. How does Canada explain its consistency with Article 14 of the ASCM?

7. On April 28^th, 2004, Canada initiated investigation into the alleged dumping and subsidizing of Chinese Carbon & Stainless Steel Fasteners. In the investigation, the Canadian authority adopted the Best Information Available (BIA) to determine a 31.5% subsidy amount simply on the ground that the information provided by the Chinese government is incomplete and that the information provided by government and by enterprises is inconsistent with each other.

Please explain the conformity of this practice to the ASCM of WTO.

Technical regulations, Conformity Assessment, and Standards

8. Regulations on Fresh Vegetables and Fruits contain specific requirements on the size, weight and labeling of packaging. For instance, the net weight in a pack for apples, apricots, peaches and pears sold in Canadian market shall not surpass 200 kg (442 pounds).

(1)     What are the basis for all the specifications on packing contained in the Act?

(2)     For the purpose of trade facilitation, does Canada plan to streamline its requirements on packing?

9. For imported fresh and processed vegetables and fruits over the packing limit, Canada requires that the importers shall provide evidence of short supply of the product in domestic market in order to obtain government’s import permit.

Does this imply that packing requirements are related to import restrictions?

10. Although Canada’s Textile Labeling Act does not require marking of the filled fibers, the provinces of Quebec, Ontario and Manitoba request that each filled costume or toy should have special label indicating the filled fibres and that manufacturers of these products must get registered in provincial authorities according to the three provinces’ relevant laws with a registration fee of 400 Canadian dollars.

How does Canada ensure the uniform application of its policy regarding labeling requirements across the country?

Sanitary an phytosanitary measures

11. The Canadian food inspection agency used the same test procedures and test standards with regard to aluminum tins and alloy tins when testing the completeness of tin pack. Therefore, it is difficult for aluminum cans to pass the test.

Please explain the reasons for using the same testing procedures and standards for both aluminum tins and alloy tins.  

12. According to Canadian Food and Drug Act and Regulations, use of caffeine is restricted in coke drinks. It is claimed that such regulations are based on the assumption that caffeine is harmful to children’s health. In 2003, Health Canada appraised the effect of caffeine to children, but did not reach a final conclusion.[1]

(1) Please explain the necessity of the above restriction.

(2) Please explain the consistency of this restriction with WTO/SPS Agreement.

Trade Policies by Sector

       Agriculture

State-trading Enterprises

13. CWB is a state-owned enterprise which, under authorization of the government, is exclusively engaged in the export of wheat and barley in western areas. All export credit of the CWB is guaranteed by the federal government via various programs. Canada does not accord same treatment for domestic and imported corn. For example, CWB enjoys preferential treatment on railroad transportation charges.

Please explain the conformity of the above policies with relevant WTO rules.

Fishery

14. The shares held by foreigners in companies with Canadian commercial fishing license is restricted to 49%.

Please explain the reasons for the above restriction.

  Telecommunication and broadcasting services

15. Please describe the development of Canadian telecommunication market, including, inter alia, the major carriers and their market shares.

16. Please describe the current situation of foreign investment in Canadian telecommunication industry, including, inter alia, the number of foreign service providers and their market shares and business scope.

17. Please describe the application procedures for a foreign service provider to enter Canadian telecommunication market and list the documents needed. Are there any procedures relating to internet and information security? If yes, please briefly describe them.

18. What are the main laws and regulations regulating the telecommunication market in Canada?

19. Canadian Telecommunications Law stipulates that in enterprises engaged in the business of transmitting equipment, shares directly held by a foreign investor shall not exceed 20%; shares indirectly held by a foreign investor shall not exceed 33%; total share under effective control of foreign investors shall not exceed 46.7%.

Please explain the reasons for the above restrictions.

  Financial Services

20. In order to invest in Canada, foreign financial institutions should apply to the OSFI.

Please provide the number of approvals and denials made by the OSFI concerning the applications by foreign financial institutions since 1995 until now.

  Air Transport

21. Foreign investors’ shares in Canadian airlines are restricted to 25%.

Please explain the reasons for the above restriction.

Professional Services

Legal services

22. In Prince Edward Island, Ontario, Alberta and Newfoundland, permanent residence is one of the requirements for the registration of a lawyer, while in Quebec, a lawyer must be a Canadian citizen.

Please explain the reasons for the above requirements.

Architectural and engineering services

23. Anyone who wants to engage in architectural services must obtain a license for a provincial or regional architect association. An applicant must pass qualifications test.

Could Canada provide the information on how many applications from foreigners have been approved, how many have been rejected since 1995 until now?

Other services

24. The Investment Canada Act stipulates that the publication and distribution of books with foreign investment must fit the national cultural policy of Canada, and generates a “net benefit” for Canada. Besides, direct acquisitions of Canadian publishing houses by foreign investors are prohibited.

Please explain how the relevant Canadian authorities determine if an application“fits the national cultural policy of Canada” and what is a “net benefit”.

25. The acquisition by foreign investors of film distribution companies controlled or owned by Canadians are prohibited. Foreign investors are allowed to establish new film distribution companies only when Canadian importers has got global distribution right or is the main investor of the new established company. Foreign investors may directly or indirectly acquire film distribution companies within the territory of Canada only when they re-invest their revenues in Canada.

Why does Canada set the above restrictions?

26. Many Chinese companies complain that the examination and approval process of short-term business visas, work permits and work visas for their staff are over-complicated and time-consuming, which hinders their business and investment activities in Canada.

Could Canadian government streamline those procedures in order to guarantee the normal conduct of business between China and Canada?