Safeguard Inquiry into the Importation of  
Certain Steel Goods  
Inquiry No. GC-2018-001  
FOREWORD  
On October 10, 2018, Her Excellency the Governor in Council, on the recommendation of  
the Minister of Finance, pursuant to paragraph 20(a) of the Canadian International Trade Tribunal  
Act, directed the Canadian International Trade Tribunal, by Order in Council P.C. 2018-1275, to  
inquire into and report on the importation of certain steel goods.  
The purpose of this inquiry was to determine whether seven classes of steel goods were  
being imported into Canada in such increased quantities and under such conditions as to be a  
principal cause of serious injury or threat of serious injury to domestic producers of like or directly  
competitive goods. The Tribunal was directed, if it made an affirmative finding for any class of  
goods, to recommend the most appropriate remedy to address the injury or threat thereof.  
The Tribunal was directed to submit to the Governor in Council, by April 3, 2019, a report  
including the Tribunal’s determination, reasons and any recommendations. Accordingly, the  
Tribunal is pleased to submit the following report.  
This inquiry is one of the most complex inquiries ever conducted by the Tribunal. There  
were 119 participants, including Canadian and foreign steel producers, steel importers, trade unions  
and governments. Over 38,000 pages of documents were submitted. The Tribunal conducted  
hearing sessions for each class of steel goods covered by the above Order in Council. The Tribunal  
heard submissions on injury and remedy together.  
The Tribunal thanks the parties, counsel and witnesses for their participation and invaluable  
assistance.  
The Tribunal also thanks the team of support staff for their dedication, professionalism and  
commitment to excellence.  
Serge Fréchette  
Serge Fréchette  
Presiding Member  
Peter Burn  
Peter Burn  
Member  
Rose Ann Ritcey  
Rose Ann Ritcey  
Member  
 
EXECUTIVE SUMMARY  
On October 10, 2018, the Tribunal was directed by the Order Referring to the Canadian  
International Trade Tribunal, for Inquiry into and Reporting on, the Matter of the Importation of  
Certain Steel Goods, P.C. 2018-1275 (Order), to conduct a safeguard inquiry concerning the  
importation into Canada of certain steel goods. The classes of goods subject to the inquiry are:  
(1) heavy plate, (2) concrete reinforcing bar, (3) energy tubular products; (4) hot-rolled sheet,  
(5) pre-painted steel, (6) stainless steel wire, and (7) wire rod. This document is the Tribunal’s  
report on the results of the inquiry.  
The direction to initiate a safeguard investigation followed the imposition of provisional  
safeguard measures pursuant to section 55 of the Customs Tariff on imports of certain steel goods  
based on a confidential report to Cabinet from the Minister of Finance.  
On October 12, 2018, the Government of Canada notified the World Trade Organization’s  
(WTO) Committee on Safeguards that it had initiated this safeguard investigation, citing a  
significant increase in total imports of the seven products in the first quarter of 2018. In the  
Notification under Article 12.4 of the Agreement on Safeguards that is required before taking a  
provisional safeguard measure, Canada advised that the Minister of Finance had determined the  
existence of critical circumstances, based on publicly available import data and confidential  
industry submissions.  
The purpose of the inquiry was to determine whether any of these goods were imported  
into Canada in such increased quantities and under such conditions as to be a principal cause of  
serious injury or threat thereof to domestic producers of such goods. The Order directed the  
Tribunal to have regard to Canada’s international trade rights and obligations.  
The Order provided that certain imports were to be excluded from the Tribunal’s inquiry—  
namely, imports from the United States, Israel and other Canada-Israel Free Trade Agreement  
(CIFTA) beneficiaries, Chile and Mexico (with the exception of energy tubular products and wire  
rod from Mexico).  
The Order required the Tribunal, in the event it determined that there was an increase in  
imports, and serious injury or threat thereof, to make separate determinations regarding subject  
goods originating in and imported from certain free trade agreement partners. Specifically, the  
Tribunal had to determine if subject goods from Panama, Peru, Colombia, Honduras and the  
Republic of Korea (Korea) were a principal cause of serious injury or threat thereof.  
The Tribunal also had to determine if energy tubular products or wire rod originating in and  
imported from Mexico did not account for a substantial share of total imports of energy tubular  
products or wire rod, or did not contribute importantly to serious injury or threat thereof.  
Specific treatment was also outlined for imports from countries benefiting from the  
General Preferential Tariff (GPT).  
The Tribunal was instructed not to hear any motion to exclude any good from a class or that  
would otherwise limit the scope of the inquiry, determination or recommendations.  
 
If ultimately the inquiry showed that imports of a class of goods caused or threatened to  
cause serious injury, the Order directed the Tribunal to provide recommendations on the most  
appropriate remedy to address the injury.  
There were 119 participants in the inquiry, including domestic producers, trade unions,  
importers, foreign producers and users of the goods. Several foreign governments also participated.  
The Tribunal held 13 days of public hearings in January 2019. The Tribunal considered evidence  
from 44 witnesses. Parties filed written submissions and presented oral argument. The Tribunal was  
directed to submit a report to the Governor in Council by April 3, 2019.  
DETERMINATIONS AND RECOMMENDATIONS  
The Tribunal’s determinations and recommendations are as follows:  
The Tribunal finds that heavy plate from the subject countries (other than goods  
originating in Korea, Panama, Peru, Colombia and Honduras) is being imported in  
such increased quantities and under such conditions as to be a principal cause of a  
threat of serious injury to the domestic industry. The Tribunal therefore recommends a  
remedy in the form of a tariff rate quota (TRQ) on imports of heavy plate from subject  
countries, other than goods originating in Korea, Panama, Peru, Colombia, Honduras,  
or countries whose goods are eligible for GPT treatment.  
The Tribunal finds that, while there has been a significant increase in the importation of  
concrete reinforcing bar from the subject countries, this increase as well as the  
conditions under which the subject reinforcing bar is being imported have not caused  
serious injury, and are not threatening to cause serious injury, to the domestic industry.  
The Tribunal therefore does not recommend a remedy in respect of concrete  
reinforcing bar.  
The Tribunal finds that, while there has been a significant increase in the importation of  
energy tubular products from the subject countries, this increase as well as the  
conditions under which the subject energy tubular products are being imported have  
not caused serious injury, and are not threatening to cause serious injury, to the  
domestic industry. The Tribunal therefore does not recommend a remedy in respect of  
energy tubular products.  
The Tribunal finds that hot-rolled sheet imported from the subject countries is not  
being imported in such increased quantities as to cause or threaten to cause serious  
injury to the domestic industry. Given that a safeguard measure can only be applied if a  
product is being imported in such increased quantities, the Tribunal does not  
recommend a remedy in respect of hot-rolled sheet.  
The Tribunal finds that pre-painted steel imported from the subject countries is not  
being imported in such increased quantities as to cause or threaten to cause serious  
injury to the domestic industry. Given that a safeguard measure can only be applied if a  
product is being imported in such increased quantities, the Tribunal does not  
recommend a remedy for pre-painted steel.  
The Tribunal finds that stainless steel wire imported from the subject countries (other  
than goods originating in Korea, Panama, Peru, Colombia and Honduras) is being  
imported in such increased quantities and under such conditions as to be a principal  
 
cause of a threat of serious injury to the domestic industry. Therefore, the Tribunal  
recommends a remedy in the form of a TRQ on imports of stainless steel wire from  
subject countries, other than goods originating in Korea, Panama, Peru, Colombia,  
Honduras, or countries whose goods are eligible for GPT treatment.  
The Tribunal finds that wire rod imported from the subject countries is not being  
imported in such increased quantities as to cause or threaten to cause serious injury to  
the domestic industry. Given that a safeguard measure can only be applied if a product  
is being imported in such increased quantities, the Tribunal does not recommend a  
remedy for wire rod.  
TABLE OF CONTENTS  
FOREWORD............................................................................................................................................... 2  
EXECUTIVE SUMMARY........................................................................................................................ 3  
DETERMINATIONS AND RECOMMENDATIONS .................................................................... 4  
PART I INTRODUCTION..................................................................................................................... 7  
ORGANIZATION OF THE REPORT................................................................................................ 7  
ORDER IN COUNCIL.......................................................................................................................... 7  
CONDUCT OF THE INQUIRY .......................................................................................................... 9  
PARTICIPATION IN THE INQUIRY................................................................................................ 9  
PRE-HEARING FACT-FINDING....................................................................................................... 9  
CONFIDENTIALITY AND ACCESS TO CONFIDENTIAL INFORMATION......................10  
PUBLIC HEARINGS........................................................................................................................... 11  
PART II MARKET AND INTERNATIONAL TRADE CONTEXT............................................12  
GLOBAL STEEL TRADE ISSUES..................................................................................................12  
THE CANADIAN STEEL MARKET............................................................................................... 14  
CANADIAN STEEL PRODUCTION .............................................................................................. 16  
CANADA’S STEEL IMPORT REGIME......................................................................................... 16  
PART III LEGAL FRAMEWORK.....................................................................................................18  
OVERVIEW..........................................................................................................................................18  
INJURY ANALYSIS........................................................................................................................... 19  
RECOMMENDATIONS ON APPROPRIATE REMEDIES........................................................30  
PART IV HEAVY PLATE...................................................................................................................32  
PART V CONCRETE REINFORCING BAR...................................................................................51  
PART VI ENERGY TUBULAR PRODUCTS .................................................................................71  
PART VII HOT-ROLLED SHEET.....................................................................................................91  
PART VIII PRE-PAINTED STEEL....................................................................................................99  
PART IX STAINLESS STEEL WIRE .............................................................................................108  
PART X WIRE ROD...........................................................................................................................125  
APPENDIX I LIST OF PARTICIPANTS........................................................................................134  
APPENDIX II WITNESSES APPEARING BEFORE THE TRIBUNAL..................................140  
APPENDIX III ATSSC STAFF INVOLVED IN THE INQUIRY...............................................147  
Canadian International Trade Tribunal  
Certain Steel Goods  
PART I INTRODUCTION  
ORGANIZATION OF THE REPORT  
This report is divided into 10 parts:  
Part I provides general information concerning the conduct of the inquiry.  
Part II describes the economic context of the inquiry.  
Part III sets out the legal framework for the inquiry.  
Parts IV to X provide the reasons for the Tribunal’s injury determinations for the  
seven classes of goods.  
In conducting the Tribunal’s analysis and formulating its Report, the Tribunal was mindful  
of the nature of the Report and its recommendatory (as opposed to a purely adjudicative) function.  
In this particular context, the Tribunal determined it would be preferable to provide a more  
comprehensive set of reasons rather than using an approach based on judicial economy. These  
reasons for decision also varied depending on the parties’ submissions to the Tribunal regarding a  
specific class of goods. For example, regarding classes of goods where the Tribunal did not find a  
significant increase in imports (and therefore did not recommend a remedy), it nonetheless provided  
observations regarding the state of the domestic industry for that class of goods, or the role of the  
subject imports and other factors, in the product-specific parts of this report. Accordingly, not every  
product-specific part of this report follows the same structure or has the same content.  
ORDER IN COUNCIL  
On October 10, 2018, the Tribunal was directed, under the terms of the Order, to conduct a  
safeguard inquiry concerning imports into Canada of seven classes of steel goods.1 This document  
is the Tribunal’s report on the results of the inquiry.  
The Order identified seven classes of goods subject to the inquiry:  
1. heavy plate;  
2. concrete reinforcing bar;  
3. energy tubular products;  
4. hot-rolled sheet;  
5. pre-painted steel;  
6. stainless steel wire; and  
7. wire rod.  
The Order was made on the recommendation of the Minister of Finance, pursuant to  
paragraph 20(a) of the Canadian International Trade Tribunal Act (CITT Act).2 The Order defined  
1. The Order and a detailed product description for each class of goods, including representative HS codes,  
can be found at http://orders-in-council.canada.ca/attachment.php?attach=36956&lang=en.  
2. R.S.C. 1985 (4th Supp.), c. 47.  
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the scope of the inquiry and established the considerations and factors for the Tribunal to take into  
account.  
The Order to initiate a safeguard inquiry followed the imposition of provisional safeguard  
measures on imports of certain steel goods pursuant to section 55 of the Customs Tariff, based on a  
confidential report to Cabinet from the Minister of Finance. The provisional measure took the form  
of a 200-day TRQ reflecting historic import volumes and trade patterns, in excess of which a surtax  
of 25 percent applies.  
On October 12, 2018, the Government of Canada notified the WTO’s Committee on  
Safeguards that it had initiated this safeguard investigation, citing a significant increase in total  
imports of the seven products in the first quarter of 2018. In its Notification under Article 12.4 of  
the Agreement on Safeguards that is required before taking a provisional safeguard measure,  
Canada advised that the Minister of Finance had determined that there existed critical  
circumstances, based on publicly available import data and confidential industry submissions.3  
The Order specifically provided the following instructions to the Tribunal:  
Exclude from the Tribunal’s inquiry imports from the United States, Israel and other  
CIFTA beneficiaries, Chile and Mexico (the latter with the exception of energy tubular  
products and wire rod, which were within the scope of the Tribunal’s inquiry).  
Determine if energy tubular products or wire rod originating in and imported from  
Mexico did not account for a substantial share of total imports of energy tubular  
products or wire rod, or did not contribute importantly to serious injury or threat  
thereof.  
Where the Tribunal determined that there was an increase in imports, and serious injury  
or threat thereof, make separate determinations regarding subject goods originating in  
and imported from certain free trade agreement partners. Specifically, the Tribunal had  
to determine if subject goods from Panama, Peru, Colombia, Honduras and Korea were  
a principal cause of serious injury or threat thereof.  
If there was a determination of no such causation, share or contribution by subject  
goods imported into Canada from free trade agreement partners or (in the case of  
energy tubular products and wire rod) Mexico, determine whether subject goods were  
imported from all other countries subject to the inquiry but not covered by the  
determination, in such increased quantities and under such conditions as to be a  
principal cause of serious injury or threat thereof.  
Not address, in any recommendations concerning a class of goods, goods imported  
from and originating in a country benefiting from the GPT where the importation of  
such goods in 2017 did not exceed 3 percent of the total importation of goods of that  
class, provided that the importation of goods of that class from all GPT countries with  
less than 3 percent import share in 2017 collectively did not exceed 9 percent of the  
total importation of goods of that class.  
3. The full notification to the WTO can be found at the following address: https://docs.wto.org  
/dol2fe/Pages/FE_Search/[email protected]=%20(g/sg/n/6/can/4)&Lan  
guage=ENGLISH&Context=FomerScriptedSearch&languageUIChanged=true#.  
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Not hear any motion to exclude any good from a class or that would otherwise limit the  
scope of the inquiry, determination or recommendations.  
If the Tribunal determined that increased imports were a principal cause of serious injury or  
threat thereof, it was directed to make recommendations to the Governor in Council on the most  
appropriate remedy to address such injury, over a period of three years.  
The Tribunal was directed to submit its report no later than April 3, 2019.  
CONDUCT OF THE INQUIRY  
On October 11, 2018, the Tribunal sent a copy of its Notice of Commencement of  
Safeguard Inquiry Certain Steel Goods (Notice) to persons and governments known to have an  
interest in the inquiry. The Notice was also published in the Canada Gazette and posted on the  
Tribunal’s website at http://www.citt-tcce.gc.ca.  
The Notice included a detailed schedule of events, including dates when parties were to file  
notices of participation, file written submissions, and reply to other parties’ submissions. The Notice  
also announced that the Tribunal would hold public hearings starting on January 3, 2019.4 The  
Notice gave parties and their counsel directions regarding procedural and preliminary matters, the  
submission of written materials, confidentiality, witness selection, the conduct of hearings, and  
other rules and procedures applicable to the inquiry.  
On October 31, 2018, the Tribunal held a teleconference to discuss its case management  
directions with those who had filed notices of participation and representation. The Tribunal  
subsequently provided parties with its responses to questions arising from the teleconference, and  
advised parties that they could present final arguments in a written closing brief.  
PARTICIPATION IN THE INQUIRY  
There were 119 participants that filed notices of participation in the inquiry. Many parties  
made written submissions regarding injury and remedy, and many replied to the submissions of  
others. Parties and their counsel are listed in Appendix I.  
PRE-HEARING FACT-FINDING  
The Tribunal’s fact-finding was based primarily on a questionnaire survey of 959 domestic  
producers, importers, and foreign producers of the steel goods subject to the inquiry. In addition, the  
Tribunal sent 215 letters to embassies requesting that they forward the Notice to any firms who  
produce and/or export any of the steel goods and complete the foreign producers’ questionnaire.  
The Tribunal received 327 responses.  
Questionnaire respondents provided economic and other information for the period of  
inquiry (POI), i.e. January 1, 2015, to June 30, 2018, inclusive. A summary of the questionnaire  
replies was prepared for parties to use as a common factual starting point in addressing the issues in  
the inquiry. In addition to a general report covering methodological matters and giving a profile of  
4. The schedule was subsequently modified so that hearings started on January 7, 2019. The revised Notice  
can be found at the following link: http://www.citt.gc.ca/en/node/8405.  
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the Canadian steel industry and market, separate reports (statistical summaries) on the industry and  
market were prepared for each of the seven classes of goods.5  
Despite the extensive verification process undertaken by the Tribunal, it is possible that  
import data used in the fact-finding phase of the inquiry contained data on imports of goods not  
subject to the inquiry.6 It is also possible that imports of some goods subject to the inquiry may not  
have been captured if they were imported under an HS Code that was not included in the illustrative  
HS Code lists for the seven classes of goods. However, the Tribunal considers that the import data  
compiled represents the best and most reliable basis for assessing import trends over the POI.  
CONFIDENTIALITY AND ACCESS TO CONFIDENTIAL INFORMATION  
The Tribunal members and its support staff are under a statutory obligation not to disclose  
confidential information which the Tribunal receives as part of any of its mandates. Its governing  
legislation also provides for the disclosure of all of the confidential information to independent  
counsel for the parties that have made the required declaration and undertaking to protect the  
information. Any violation of the terms of their declaration and undertaking is a serious offence.  
In the current inquiry, especially as contrasted with the Steel Safeguard Inquiry of 2002,7 a  
large quantity of information had to be designated as confidential. A primary reason for this is that  
there are fewer steel producers in Canada today than there were in that prior period, and, therefore,  
it was more difficult to make aggregate industry data public without revealing company-specific  
information.8  
Certain parties, including foreign governments not represented by counsel, requested  
disclosure of more information than was initially disclosed in the Tribunal’s statistical summaries.  
The Tribunal addressed these concerns by providing some revisions to its public statistical  
summaries which revealed more information. In doing so, the Tribunal reminded parties of the  
following:  
Some data fields may be public for class of goods but confidential for another class.  
The data presented in the revised statistical summaries adhere to the Trade Remedies  
Investigations Branch’s confidentiality procedures in order to comply with the statutory  
requirements governing the designation of confidential information in the Tribunal’s  
5. The import data presented in the statistical summaries are derived from the responses provided to the  
Tribunal’s questionnaires and from estimations using the Canada Border Services Agency (CBSA)  
Facility for Information Retrieval Management (FIRM) data. FIRM data on the 10-digit Harmonized  
System (HS) tariff classification code are recorded for a good when it enters Canada. FIRM data are  
confidential.  
6. Although the Order did not include HS Codes, the Department of Finance prepared illustrative lists of  
10-digit HS Codes for goods in each of the seven classes. These HS codes were used to determine which  
importers would receive questionnaires. However, respondents were directed to provide information on  
all imports matching the product definition, no matter the HS code under which they were imported.  
7. Steel Goods (August 2002), GC-2001-001 (CITT) [Steel Goods]. Available online at: http://publications  
.gc.ca/Collection/F42-12-2002E.pdf.  
8. As well, the statistical summaries presented the data in more detail (e.g. domestic producer imports were  
presented separately from excluded country imports, as were subject country imports) than in the 2002  
Steel Safeguard inquiry, which further restricted the data which could be made public without  
inadvertently revealing company-specific information.  
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proceedings found in sections 45 to 49 of the CITT Act. These requirements cover  
instances where there are only one or two respondents providing the information, i.e.  
where there is no possibility of aggregating confidential information to make it public.  
They also require the Tribunal to consider whether there is dominancewhere a small  
number of firms account for a very large portion of any data field such that confidential  
information could be revealed by means of reverse-engineering the data.  
Counsel who have signed Declarations and Undertakings received the protected  
revised statistical summaries, as they had with the entirety of the confidential record.  
Accordingly, not every product-specific part of this report will present the same range of  
information, depending on what data can be made public.  
PUBLIC HEARINGS  
The inquiry was conducted in accordance with the Canadian International Trade Tribunal  
Rules (CITT Rules).9 The Tribunal varied and supplemented the CITT Rules to provide for a more  
expeditious process reflecting the short time frame for completion of the inquiry.10  
At the public hearings, the Tribunal questioned witnesses for the domestic producers,  
importers, foreign producers and users of the various steel goods on key issues. Witnesses were  
selected by the Tribunal from among those who had filed witness statements. In selecting witnesses,  
the Tribunal took account of matters it believed required clarification. Parties questioned witnesses,  
made oral arguments, and had the opportunity to submit written final arguments.  
Appendices I and II list the witnesses and counsel who appeared at the public hearings.  
In the course of the public hearings, the parties had the opportunity to file additional  
evidence as part of their witness statements. One such type of evidence was Statistics Canada11  
import data submitted by witnesses for the domestic industry as relevant, including data regarding  
issues of increased imports and threat of serious injury. Parties opposed argued that such data was  
inadmissible (especially Q3 2018 data which was said to be outside of the Tribunal’s POI) and  
unreliable given the differences between it and data derived from Tribunal questionnaires. The  
Tribunal finds that the data is admissible as it is relevant. While the Tribunal’s period for data  
gathering for its statistical summaries is the POI, relevant evidence which can be received from  
parties is not confined to that time period. This should be especially evident as part of the Tribunal’s  
mandate is to assess issues regarding threat of serious injury, an assessment that is by its nature  
focused on future events. The Tribunal also tested the reliability of the Statistics Canada data (as  
explained in the product-specific parts of this report) in deciding what weight, if any, to place on it  
in a given context.  
9. SOR/91-499.  
10. Rule 6 allows the Tribunal to dispense with, vary or supplement the CITT Rules to provide for a more  
expeditious process as permitted by the circumstances and considerations of fairness.  
11. Statistics Canada data is a limited set of import information, collected from customs declarations by the  
CBSA, essentially consisting of tariff classification, volume, value for duty and origin of goods. The  
CBSA has access to more extensive data, as part of its FIRM system, on which data the Tribunal  
routinely relies in SIMA proceedings.  
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PART II MARKET AND INTERNATIONAL TRADE CONTEXT  
GLOBAL STEEL TRADE ISSUES  
There is significant world trade in steel goods, including the seven classes of steel goods  
covered by this inquiry. The Organisation for Economic Co-operation and Development (OECD)  
estimated that in 2014 the volume of global steel exports stood at around 442 million metric tonnes  
(tonnes), which was slightly higher than the volume recorded in 2007, prior to the financial crisis.12  
More recently, the OECD estimates the volume of global steel exports was 449 million tonnes  
during the first seven months of 2017 (annualized), using monthly data from the International Steel  
Statistics Bureau.13 This is down from 460 million tonnes in 2016.14  
In an effort to address global steel trade issues, industrialized nations worked toward  
liberalizing trade in steel. During the Uruguay Round of multilateral trade negotiations which ended  
in 1994, current members of the WTO, including Canada, made commitments to reduce tariffs on  
steel imports. They also agreed to limit the use of quantitative restrictions but allow the imposition  
of safeguard measures to address injurious increases in fairly traded steel. To that end, the WTO  
signatories committed to phase in tariff reductions for steel, and signed the Agreement on  
Safeguards.15  
Negotiations to address steel production overcapacity have continued since  
September 2001 in the OECD and, more recently, in the G-20.16  
Notwithstanding these efforts, international trade in steel continues to be distorted by  
massive steel production overcapacity, fuelled primarily by China’s extraordinary economic  
expansion since 2000. Since 2000, global crude steelmaking capacity has more than doubled from  
1,061 million tonnes to an estimated 2,291 million tonnes in 2018nearly 50 percent larger than  
total global demand.17 Over the same period, the global crude steelmaking capacity-to-consumption  
gap has more than tripled from just over 200 million tonnes in 2000 to approximately 650 million  
tonnes in 2016.18  
China is responsible for 75 percent of new steel capacity since 2000, with its crude  
steelmaking capacity increasing sevenfold from 150 million tonnes in 2000 to an estimated  
1,048 million tonnes in 2018a level that represents more than 46 percent of total world crude  
steel capacity.19 Trading partners with domestic steelmaking capacity have sought commitments  
from China to reduce its excess capacity and eliminate further subsidies.20 China’s response has  
been to acknowledge the problem and to make repeated commitments to reduce steel production  
capacity. While Chinese crude steel making capacity has declined by about 100 million tonnes  
12. Exhibit GC-2018-001-066.38, Vol. 1 at 6.  
13. Exhibit GC-2018-001-066.39, Vol. 1 at 13.  
14. Ibid.  
15. Canada bound its tariffs at zero percent for all of the subject goods at the conclusion of the Uruguay  
Round: Exhibit GC-2018-001-066.43, Vol. 1.  
16. Exhibit GC-2018-001-066.36, Vol. 1 at 6-9; Exhibit GC-2018-001-066.27, Vol. 1.  
17. Exhibit GC-2018-001-066.29, Vol. 1 at 4 and 12.  
18. Ibid. at 12.  
19. Ibid. at 4.  
20. Exhibit GC-2018-001-066.31, Vol. 1 at 4.  
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since 2015,21 this is just a small step considering the exponential growth seen in the previous years.  
The net result is that China has added nearly 500 million tonnes of new capacity since 2007.22  
Steel producers have responded to episodes of weak growth and the global overcapacity  
issue, in part, by increasing market and product concentration. Driven by external forces  
increasingly global and diverse, the North American and global steel industry saw a wave of  
consolidation between 1995 and 2005, including mergers and the selling of non-core assets,  
resulting in increased concentration in regional markets and increased market power.23 In 1995, the  
top 10 producers supplied 20 percent of global steel output. By 2005, this figure had increased to  
about 29 percent.24 The global trend has been particularly noticeable in areas where there has been  
more regional consolidation over the years, including the United States.25  
The advancement in information technology has allowed globally integrated steel  
producers, such as ArcelorMittal, to gain a competitive advantage by leveraging technological  
advances across their plants and adjusting to local demand shifts.26  
While steel market conditions have shown some cyclical recovery in 2017, the underlying  
trend in global steel demand remains weak and excess capacity remains significant.27 The World  
Steel Association forecasts that global steel demand will stay on the low growth track, with demand  
in 2018 and 2019 showing a mild deceleration over 2017.28  
Continued rationalization of excess capacity and further consolidation will be necessary to  
bring back efficiency and profitability to the industry.29 This process is supported by several  
countries, including Canada, who have identified various measures to promote industry  
consolidation and facilitate changes in ownership structure, corporate governance, and corporate  
financing.30 In North America, recent mergers and acquisitions activity has focused on Canadian  
producers Essar Algoma and U.S. Steel Canada and American producers A.K. Steel and Nucor.31  
The last few years have seen increasing international trade tensions, especially with regard  
to steel. Trade-restrictive regimes for steel have arisen in major markets around the world, with  
anti-dumping duty, countervailing duty, and more recently, safeguard measures being employed  
numerous times.  
Most notably, in April 2017, the Trump administration self-initiated an unprecedented  
investigation of the impact of imported steel on U.S. national security pursuant to section 232 of the  
Trade Expansion Act of 1962.32 On March 8, 2018, President Trump issued Proclamations on  
Adjusting Imports of Steel and Aluminum into the United States, following a recommendation  
21. Exhibit GC-2018-001-066.29, Vol. 1 at 4.  
22. Ibid.  
23. Exhibit GC-2018-001-066.25, Vol. 1 at 5.  
24. Ibid. at 19.  
25. Ibid. at 19 and 21.  
26. Exhibit GC-2018-001-066.28, Vol. 1 at 27-28.  
27. Exhibit GC-2018-001-066.27, Vol. 1 at 1.  
28. Exhibit GC-2018-001-066.34, Vol. 1 at 3.  
29. Exhibit GC-2018-001-066.25, Vol. 1 at 5 and 15; Exhibit GC-2018-001-066.35, Vol. 1 at 6.  
30. Exhibit GC-2018-001-066.27, Vol. 1 at 23.  
31. Exhibit GC-2018-001-066.35, Vol. 1 at 7; Exhibit GC-2018-001-066.27 at 49-50.  
32. Exhibit GC-2018-001-075.15, Vol. 5 at 7.  
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from U.S. Commerce Secretary Wilbur Ross, according to which steel was being imported in such  
quantities and under such circumstances as to threaten to impair the national security, with the  
excess global production of steel and the present quantities of steel imports into the United States  
weakening our internal economy and shrinking our ability to meet national security production  
requirements in a national emergency.”33  
Canada and Mexico were temporarily excluded from the original proclamations. However,  
on May 31, 2018, President Trump extended the coverage of the section 232 measures to include  
Canada and Mexico, and imposed a 25 percent tariff on imports of certain steel products.34  
On July 1, 2018, Canada responded by imposing a countermeasure, i.e. a 25 percent surtax  
on up to C$16.6 billion in imports of steel (and other products) from the United States, representing  
the value of 2017 Canadian exports affected by the U.S. measures.  
The European Union followed suit with provisional safeguard measures on imports of  
28 steel product categories on July 18, 2018,35 imposing definitive safeguard measures on imports  
of 26 steel products on January 31, 2019.36 China and Mexico also implemented specific measures,  
with China implementing countermeasures on $60 billion in U.S. goods on August 3, 2018, and  
Mexico imposing countermeasures on imports of five categories of steel products from the United  
States in June 2018.37 Additionally, the Eurasian Economic Union (comprising of the Kyrgyz  
Republic, the Russian Federation, Kazakhstan and Armenia) initiated a safeguard investigation on  
certain flat-rolled steel products on August 7, 2018.38 Turkey also imposed provisional safeguard  
measures on five steel product categories in September 2018.39  
It is in this context that Canada imposed provisional safeguard measures and the Tribunal  
initiated and conducted this investigation.  
THE CANADIAN STEEL MARKET  
The use of steel in the Canadian economy is widespread. The most important steel-using  
sectors are manufacturing, particularly the automotive and transport equipment industries, and  
construction and energy sectors.  
Canadian demand for steel consistently exceeds supply. Apparent consumption in Canada  
(domestic production minus exports plus imports) averaged 14.6 million tonnes in the period  
2015-2017, with production of 12.9 million tonnes, exports of 6.4 million tonnes and imports of  
33. Section 232 of the Trade Expansion Act of 1962, 19 U.S.C. § 1862(c), was the provision relied on by the  
President of the United States, to adjust the imports of goods or materials from other countries, through  
tariffs or other means, if it is found that the quantity or circumstances surrounding those imports threaten  
to impair national security. The consequent actions are referred to as “section 232 measures” throughout  
this Report.  
34. Exhibit GC-2018-001-075.15, Vol. 5 at 20.  
35. Exhibit GC-2018-001-03A, Vol. 1.1 at 25.  
36. Available online at https://eeas.europa.eu/delegations/world-trade-organization-wto/56228/steel-  
commission-intends-impose-definitive-safeguard-measures-imports-certain-steel-products-4_en.  
37. Exhibit GC-2018-001-066.05, Vol. 15 at 39.  
38. Exhibit GC-2018-001-077.06, Vol. 5 at 101-104.  
39. Exhibit GC-2018-001-066.05, Vol. 15 at 116.  
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8.1 million tonnes, leaving import penetration at approximately 60 percent of total market  
demand.40  
Canadian steel producers, particularly in more populous Central Canada, have long  
operated within a highly integrated cross-border market with American producers located in the  
Great Lakes region. The cross-border movement of steel products has been encouraged by the  
existence of an integrated cross-border automotive industry since the signing of the Canada—  
United States Automotive Products Agreement of 1965 (commonly known as the Auto Pact) the  
automotive industry being a major steel consumer.41  
Canada’s steel industry, as with all of North America, has become increasingly foreign-  
owned during the 21st century.42 For example, ArcelorMittal purchased both the flat products  
producer Dofasco (now ArcelorMittal Dofasco) and various long product operations, now operating  
as ArcelorMittal Long Products Canada and is part of ArcelorMittal Americas, a wholly owned  
subsidiary of ArcelorMittal of Luxembourg.43 Gerdau, a Brazilian multinational, entered the  
Canadian market in 1989 with the purchase of Courtice Steel Inc. and formed Gerdau Ameristeel  
Corporation in 1999.44 The global pipe and tube producer, Tenaris, operates Algoma Tubes,  
Prudential Steel ULC, Tenaris Global Services (Canada) and Hydril Canadian Company LP in  
Canada.45 Stelco has emerged as a separate public company after a period of ownership by U.S.  
Steel.46 IPSCO has become part of Evraz North America, which is itself a subsidiary of UK-based  
Evraz plc; Algoma Steel Inc., formerly Essar Steel Algoma Inc., has been reorganized and sold by  
its previous owner (the Essar group of India) to a private equity firm and its term lenders.47  
Canada’s relatively small domestic market means that the ability to address both domestic  
and U.S. demand is often necessary to justify investment in efficient facilities of scale. It also means  
that Canadian steel users necessarily rely on imports to meet more specialized needs. At the same  
time, in a global steel company, the supply chain needs to be optimized at the global rather than the  
local level to maximize profit.48 In this context, as a result of the North American Free Trade  
Agreement (NAFTA) and other globalizing market forces, Canadian steel producers increasingly  
participate in an integrated North American market with demand being driven by North American  
supply chains in energy, construction and manufacturing.49  
Geography has facilitated the development of an integrated steel market in the Great Lakes  
region. It has also impeded the development of a single national steel market across Canada, as the  
vast distance between Quebec and Southern Ontario and the West Coast means most Canadian steel  
producers face a formidable cost disadvantage in transporting products by rail to Vancouver,  
relative to the cost of trucking steel to Vancouver from adjacent Pacific Northwest states, or  
shipping steel from Asia by boat to the Port of Vancouver.  
40. Exhibit GC-2018-001-066.32, Vol. 1 at 6 and Exhibit GC-2018-001-066.24, Vol. 1 at 6.  
41. Cross-border commerce also occurs “upstream” at the level of coal, iron and other steel inputs.  
42. One estimate suggests foreign steelmakers owned 42 percent of steel capacity in the NAFTA region:  
GC-2018-001-066.28, Vol. 1 at 24.  
43. Exhibit GC-2018-001-079.06, Vol. 5 at 42.  
44. Exhibit GC-2018-001-073.06, Vol. 5 at 47.  
45. Exhibit GC-2018-001-075.19, Vol. 5 at 43.  
46. Exhibit GC-20118-001-077.04, Vol. 5 at 24.  
47. Exhibit GC-2018-001-071.06, Vol. 5 at 71.  
48. Exhibit GC-2018-001-066.25, Vol. 1 at 23-24.  
49. Exhibit GC-2018-001-066.27, Vol. 1 at 53.  
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Canada was the world’s 16th-largest steel importer in 2017, with Canada’s imports  
representing about 2 percent of all steel imported globally in 2017. Canada imported steel from over  
100 countries and territories, though the top 10 countries together accounted for over 85 percent of  
total steel imports in 2017. Consistent with the reality of an integrated cross-border market in the  
Great Lakes region, the United States accounts for approximately half of all steel imports into  
Canada, and is the largest source of Canada’s steel imports in flat, long, tubular, and stainless  
products. For instance, in H1 2018, imports from the United States accounted for 70 percent of  
Canada’s flat product imports, 55 percent of long product imports, 64 percent of stainless steel  
imports and 39 percent of pipe and tube imports.50  
CANADIAN STEEL PRODUCTION  
Steel production in Canada is now dominated by foreign-owned companies, with many  
domestically owned firms having been purchased by multinational steel companies during the first  
decade of the 21st century.51 The largest producer, Luxembourg-based ArcelorMittal, alone  
accounts for roughly half of Canadian steel production through its two subsidiaries, ArcelorMittal  
Dofasco and ArcelorMittal Long Products Canada.52  
The seven classes of steel goods subject to the inquiry account for 85 percent of carbon and  
alloy steel produced in Canada.53 There are 15 firms producing these products across Canada.54 In  
2017, the Canadian primary steel industry employed more than 23,000 people,55 and had export  
sales of $7.9 billion.56 Domestic sales from the seven classes of goods totalled $4.4 billion.57  
CANADA’S STEEL IMPORT REGIME  
All imports of the seven classes of steel goods into Canada are subject to Most Favourite  
Nation duty-free tariff treatment.58  
Canada has considered safeguard measures for the steel industry in the past. The Tribunal  
conducted a steel safeguard inquiry in 2002.59 The following nine classes of steel goods were  
subject to that inquiry: discrete plate; hot-rolled sheet and coil; cold-rolled sheet and coil;  
corrosion-resistant sheet and coil; hot-rolled bars; angles, shapes and sections; cold-drawn and  
finished bars and rods; reinforcing bars; and standard pipe. As a result of that inquiry, the Tribunal  
50. Exhibit GC-2018-001-066.32, Vol. 1 at 1-4.  
51. For some examples, Exhibit GC-2018-001-024.04, Vol. 3 at 377; GC-2018-001-026.04, Vol. 3 at 15;  
Exhibit GC-2018-001-073.06, Vol. 5 at 47.  
52. Exhibit GC-2018-001-066.24, Vol. 1 at 6.  
53. Available online at: https://www150.statcan.gc.ca/n1/pub/71-607-x/71-607-x2018006-eng.htm and  
various statistical summaries.  
54. Exhibit GC-2018-001-03A, Vol. 1.1 at 22.  
55. Available  
online  
at:  
https://international.gc.ca/trade-commerce/controls-controles/steel_alum-  
acier_alum.aspx?lang=eng.  
56. Available online at: https://www5.statcan.gc.ca/cimt-cicm/home-accueil?lang=eng.  
57. Various statistical summaries.  
58. Customs Tariff, S.C. 1997, c. 36, Schedule.  
59. Steel Goods.  
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made several recommendations regarding remedies for five of the nine steel goods;60 however, the  
Government of that time did not implement any of those recommendations.  
Canadian anti-dumping measures currently apply to imports of goods of four of the seven  
classes of goods subject to the inquiry, and some subject goods are also subject to Canadian  
countervailing measures.61 Certain measures have been in place for several years, and many of  
them are not scheduled to expire until 2023.62 Canada’s anti-dumping and countervail regime is  
very effective at blocking unfairly traded goods from entering the Canadian market, as imports of  
steel products from countries subject to such measures are minimal in most instances.  
As of the beginning of 2018, Canada had 46 outstanding anti-dumping orders against steel  
products from 23 countries, including six anti-dumping orders against Korean products and seven  
against Chinese products. There were also eight outstanding countervailing duty orders, including  
six orders against Chinese products.  
60. These products were discrete plate, cold-rolled sheet and coil, reinforcing bars, angles, shapes and  
sections, and standard pipe.  
61. The products are heavy plate, energy tubular products, rebar and hot-rolled sheet.  
62. Exhibit GC-2018-001-05A, Vol. 1.1 at 35; Exhibit GC-2018-001-09B, Vol. 1.1 at 44; Exhibit GC-2018-  
001-07A, Vol. 1.1 at 34; and Exhibit GC-2018-001-011A, Vol. 1.1 at 35.  
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PART III LEGAL FRAMEWORK  
OVERVIEW  
The Governor in Council may refer to the Tribunal, for inquiry and a report thereon, any  
matter regarding goods imported into Canada in such increased quantities and under such  
conditions as to be a principal cause of serious injury or threat thereof to domestic producers of like  
or directly competitive goods.63 The Governor in Council establishes the terms of reference for the  
inquiry and report.64 The Tribunal must conduct the inquiry and prepare the report in accordance  
with the terms of reference.65 The Canadian International Trade Tribunal Regulations (CITT  
Regulations) provide interpretative guidance and prescribe factors to be examined in an inquiry  
under paragraph 20(a) of the CITT Act.  
On October 10, 2018, on the recommendation of the Minister of Finance and pursuant to  
paragraph 20(a) of the CITT Act, the Governor in Council directed the Tribunal to undertake a  
safeguard inquiry regarding the importation of certain steel goods into Canada.66 The Order  
established the terms of reference for the inquiry, and prescribed considerations and factors for the  
Tribunal to take into account.67 Subject to an exception for GPT countries, the Order also directed  
the Tribunal to make remedy recommendations if it found serious injury to domestic producers or  
threat thereof.68  
In carrying out the inquiry pursuant to the provisions of the Order, the Tribunal was  
directed to have regard to Canada’s rights and obligations under international trade agreements.69  
The relevant agreements include the WTO Agreement on Safeguards70 and the General Agreement  
on Tariffs and Trade 1994 (GATT 1994).71  
63. CITT Act, paragraph 20(a).  
64. CITT Act, subsection 20.2(1).  
65. CITT Act, subsection 21(1).  
66. Order, section 1.  
67. Order, sections 2-5.  
68. Order, section 6.  
69. Order, section 1.  
70. The original 1947 General Agreement on Tariffs and Trade (GATT) contained a safeguard provision,  
i.e. Article XIX. A separate agreement on the rules for application of safeguard measures pursuant to  
Article XIX was concluded during the Uruguay Round of multilateral trade negotiations, and entered  
into force in 1995 with the inception of the WTO. The Agreement on Safeguards aims to (i) clarify and  
reinforce GATT disciplines, particularly those of Article XIX; (ii) re-establish multilateral control over  
safeguards and eliminate measures that escape such control; and (iii) encourage structural adjustment on  
the part of industries adversely affected by increased imports, thereby enhancing competition in  
international markets. The Agreement on Safeguards was negotiated in large part because GATT  
Contracting Parties had been applying a variety of so-called “grey area” measures that were not imposed  
pursuant to Article XIX, and thus were not subject to multilateral discipline through GATT. The  
Agreement on Safeguards now clearly prohibits such measures, and has specific provisions for  
eliminating those that were in place at the time the WTO Agreement on Safeguards entered into force.  
71. Canada is a WTO Member; it is also a party to NAFTA, CIFTA, the Canada-Chile Free Trade  
Agreement, the Canada-Colombia Free Trade Agreement, the Canada-Korea Free Trade Agreement,  
the Canada-Peru Free Trade Agreement, the Canada-Panama Free Trade Agreement and the Canada-  
Honduras Free Trade Agreement.  
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The legal framework reflects the requirements of the Order, the CITT Act, the CITT  
Regulations, and Canada’s rights and obligations under international trade agreements. The specific  
elements of the Tribunal’s injury analysis and remedy determinations are set out below.  
INJURY ANALYSIS  
The Tribunal’s inquiry was to determine whether goods of the seven classes of goods were  
imported into Canada in such increased quantities and under such conditions as to be a principal  
cause of serious injury or threat thereof to domestic producers of like or directly competitive  
goods.72 Therefore, to make its determination for each class of goods, the Tribunal considered:  
(a) whether domestically produced steel goods were “like or directly competitive” to  
imported goods of a subject class of goods;  
(b) where the goods were like or directly competitive, who were the domestic producers of  
such goods;  
(c) whether there was a significant increase in imports of the subject goods;  
(d) if such an increase occurred, whether it resulted from unforeseen developments and the  
effect of obligations incurred by Canada under GATT 1994, including tariff  
concessions;  
(e) if the increased imports arose from unforeseen developments and the effect of  
Canada’s GATT 1994 obligations, whether there was serious injury to domestic  
producers of like or directly competitive goods;  
(f) if there was serious injury, whether the significant increase in imports is a principal  
cause of the injury;  
(g) if there was no serious injury or the increase in imports is not a principal cause of the  
injury, the Tribunal examined whether there was a threat of serious injury;  
(h) if there was a threat of serious injury, the Tribunal assessed whether the increase in  
imports is a principal cause of that threat; and  
(i) if the Tribunal determined that an increase in imports of goods of a class from all  
sources other than the United States, Chile, Israel or another CIFTA beneficiary, and in  
certain cases Mexico, is a principal cause of serious injury or threat thereof, it  
considered whether imports of such goods from certain free trade agreement partners  
are a principal cause of the injury or threat thereof, and if not, the Tribunal determined  
whether all the goods of that class imported from all other countries subject to the  
inquiry were imported in such increased quantities to be a principal cause of serious  
injury or threat thereof.  
Each of the above-mentioned elements of the Tribunal’s injury analysis is discussed in  
more detail below.  
72. CITT Act, paragraph 20(a).  
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Like or directly competitive goods  
The Tribunal must determine whether domestically produced steel goods are “like or  
directly competitive” to imported goods of a subject class of goods. “Like or directly competitive  
goods” are goods that are identical in all respects to, or have uses and other characteristics that  
closely resemble, goods that are the subject of the inquiry.73  
In its analysis of whether domestic goods are “like or directly competitive” to goods in a  
subject class of imported goods, the Tribunal examined a range of factors, including: physical  
characteristics (such as physical appearance and composition), market characteristics (such as  
substitutability, pricing and distribution), and the question of whether the goods meet the same  
customer needs.74  
The Tribunal was specifically prohibited by subsection 3(2) of the Order from considering  
whether the subject and like goods were comprised of more than one class of goods.  
Domestic producers  
The Tribunal’s injury analysis must consider the impact of the imported subject goods on  
domestic producers of like or directly competitive goods in Canada.75 Neither the CITT Act, nor the  
CITT Regulations, nor the CITT Rules define “domestic producers” for the purposes of a safeguard  
inquiry. The Agreement on Safeguards also addresses injury in the context of the impact of imports  
on the performance of a domestic industry.76 It defines domestic industry” as “the producers as a  
whole of the like or directly competitive products operating within the territory of a Member, or  
those whose collective output of the like or directly competitive products constitutes a major  
proportion of the total domestic production of those products.”77 The words “as a whole” and “a  
major proportion” address “the number and the representative nature of producers making up the  
domestic industrythey are a quantitative benchmark for the proportion of producers . . . which a  
safeguard investigation has to cover.”78  
As mentioned earlier, the Order requires the Tribunal to have regard to Canada’s rights and  
obligations under international trade agreements.79 Therefore, in conducting its injury analysis for  
73. For the purposes of the CITT Act, section 3 of the CITT Regulations defines “like or directly competitive  
goods” as “(a) goods that are identical in all respects to the goods that are the subject of a complaint, or  
(b) in the absence of any identical goods referred to in paragraph (a), goods the uses and other  
characteristics of which closely resemble those goods that are the subject of a complaint” Although the  
definition refers to goods that “are the subject of a complaint”, the Tribunal has previously held that the  
definition also applies to an inquiry referred to the Tribunal pursuant to paragraph 20(a) of the CITT Act;  
Steel Goods at 12.  
74. Steel Goods at 15; Bicycles and Frames (September 2005), GS-2004-01 and GS-2004-002 (CITT)  
[Bicycles and Frames] at para. 65.  
75. Paragraph 2(1)(a), Order; paragraph 5(1)(c), CITT Regulations; and paragraph 20(a), CITT Act.  
76. Agreement on Safeguards, article 4.1(a).  
77. Agreement on Safeguards, article 4.1(c).  
78. United States Safeguard Measures on Imports of Fresh, Chilled or Frozen Lamb Meat from New  
Zealand and Australia, WTO Docs. WT/DS177/AB/R (1 May 2001), Report of the Appellate Body  
[U.S. Lamb] at para. 91.  
79. Order, section 1.  
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each class of goods, the Tribunal has identified the domestic producers on the basis of the  
Agreement on Safeguards definition.  
The Tribunal must determine what constitutes the domestic industry for each product.  
Although the Tribunal may determine that all or a subset of all domestic producers constitute the  
domestic industry, once it has made that determination, its analysis of whether the domestic  
industry has been injured must proceed on the same basis.80 In this respect, the Federal Court of  
Appeal has approved of the Tribunal’s methodology and stated that “[t]he wording of  
subsection 2(1) of [the Special Imports Measure Act] leaves it open, depending on the  
circumstances, to consider domestic producersas a whole or a major proportionthereof for  
purposes of making a determination regarding the domestic industry.”81  
Increase in imports  
The Tribunal must determine whether any of the subject goods have been imported into  
Canada in such increased quantities since January 1, 2015, and under such conditions, as to be a  
principal cause of serious injury or threat thereof.82 To determine whether the subject goods have  
been imported in increased quantities, the Tribunal must examine the actual volume of the goods  
imported into Canada.83 When examining actual import volumes, the Tribunal must consider  
whether there has been a significant increase in the importation into Canada of the goods.84 Where  
such an increase has occurred, the Tribunal must consider the rate and amount of the increase, either  
absolutely or relative to the production in Canada of like or directly competitive goods.85  
Similarly, the Agreement on Safeguards states that safeguard measures can only be applied  
if products are imported in such increased quantities, in absolute terms or relative to domestic  
production, and under such conditions, as to cause or threaten to cause serious injury.86 The  
Agreement on Safeguards also provides that the competent authority must evaluate all relevant  
objective and quantifiable factors, including the rate and amount of the increase, in absolute and  
relative terms.87 The Tribunal must base its evaluation of objective and quantifiable factors, such as  
its evaluation of the rate and amount of increased imports, on objective data and evidence.88  
According to the WTO Appellate Body, the phrase “in such increased quantities” in the  
Agreement on Safeguards and GATT 1994 Article XIX:1(a) means that “the increase in imports  
must have been recent enough, sudden enough, sharp enough, and significant enough, both  
80. The Tribunal acknowledges that it is often presented with a domestic industry where the various  
domestic producers are performing differently, including as a result of their corporate organization,  
business structure or market focus. It is open for parties to make any arguments regarding such  
performance but the overall approach to the Tribunal’s injury analysis remains as stated above.  
81. Essar Steel Algoma Inc. v. Jindal Steel and Power Limited (9 August 2017), 2017 FCA 166 at paras. 20,  
24; leave to appeal to the Supreme Court of Canada denied.  
82. Order, subsections 2(2) and 3(1); CITT Act, paragraph 20(a).  
83. CITT Regulations, paragraph 5(1)(a).  
84. CITT Regulations, subsection 5(2).  
85. Ibid.  
86. Article 2.1; Article XIX:1(a) of GATT 1994 contains a similar requirement.  
87. Article 4.2(a); NAFTA contains a similar provision (para. 9, Annex 803.3).  
88. U.S. Lamb at paras. 129 and 130.  
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quantitatively and qualitatively, to cause or threaten to cause ‘serious injury’.89 An assessment of  
whether an increase is “recent enough, sudden enough, and significant enough” should not be done  
in the abstract.90 The question is not whether imports have increased recently and suddenly in the  
abstract; rather, the increase in imports must have a “certain degree of being recent and sudden.”  
Determining whether the requirement for imports to be “in such increased quantities” has  
been met does not involve a mere mathematical or technical determination.91 It is not sufficient to  
show simply that imports in one year were more than in a previous year or years.92 Recent imports  
must be examined, not just import trends during a period of several years in the past.93  
This is not to suggest that import trends are not relevant. Investigative authorities are  
expected to consider trends in imports over the period of inquiry, not to simply compare end points,  
such as the beginning and end of a period of inquiry.94 There must be an explanation of how the  
trend in imports over a period of inquiry supports a finding of “such increased imports” within the  
meaning of the Agreement on Safeguards and GATT 1994 Article XIX:1(a).95  
The term recent” need not be interpreted as meaning that imports must continue to  
increase right up to the date of the determination, nor does it imply an analysis limited to the  
present.96 There can be a ‘“recent’ increase even if that increase has ceased prior to the date of the  
determination, as long as imports remain at a sharply increased level.”97  
With such considerations in mind, it follows that the Tribunal will generally:  
determine if the evidence shows an increase in imports for a class of goods, considering  
recent imports, import trends, and end-point comparisons;  
determine the rate and amount of the increase in absolute terms and relative to the  
production in Canada of like or directly competitive goods; and  
assess whether the increased quantity of imports is recent enough, sharp enough,  
sudden enough, and significant enough, both in absolute terms and relative to  
production in Canada, to cause or threaten to cause serious injury.98  
89. Argentina Safeguard Measures on Imports of Footwear (12 January 2000), WTO Docs.  
WT/DS121/AB/R, Report of the Appellate Body [Argentina Footwear] at para. 131; United States –  
Definitive Safeguard Measures on Imports of Certain Steel Products (10 December 2003), WTO Docs.  
WT/DS248/AB/R, WT/DS249/AB/R, WT/DS251/AB/R, WT/DS252/AB/R, WT/DS253/AB/R,  
WT/DS254/AB/R, WT/DS258/AB/R and WT/DS259/AB/R, Report of the Appellate Body [U.S. –  
Steel] at para. 346.  
90. U.S. Steel at para. 360.  
91. Argentina Footwear at para. 131.  
92. Ibid.  
93. Ibid. at para. 130.  
94. Ibid. at para. 129; U.S. Steel at paras. 354 and 355.  
95. US Steel at para. 374.  
96. United States Definitive Safeguard Measures on Imports of Circular Welded Carbon Quality Line  
Pipe from Korea (29 October 2001), WTO Docs. WT/DS202/R, Report of the Panel [Line Pipe] at  
paras. 7.207 and 7.208.  
97. Ibid. at para. 7.208.  
98. Steel Goods at 17; Bicycles and Frames at para. 85.  
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The Tribunal also addressed the more qualitative assessment of a “significant” increase by  
viewing import volumes in the context of market size.  
Unforeseen developments and obligations under GATT 1994  
The relevance of unforeseen developments and of the effect of Canada’s obligations under  
GATT 1994 in a safeguard inquiry is not addressed in domestic legislation. However, the Order  
requires the Tribunal to have regard to Canada’s rights and obligations under international trade  
agreements.99 The Tribunal notes that its past decisions have taken into account international trade  
agreements to which Canada is a party.100  
Article XIX of GATT 1994 (Emergency Action on Imports of Particular Products) provides  
that safeguard measures can only be imposed if certain circumstances exist and specific conditions  
are met,101 and provides in part as follows:  
1.(a) If, as a result of unforeseen developments and of the effect of the obligations incurred  
by a contracting party under this Agreement, including tariff concessions, any product is  
being imported into the territory of that contracting party in such increased quantities and  
under such conditions as to cause or threaten serious injury to domestic producers in that  
territory of like or directly competitive products, the contracting party shall be free, in  
respect of such product, and to the extent and for such time as may be necessary to prevent  
or remedy such injury, to suspend the obligation in whole or in part or to withdraw or  
modify the concession.  
[Emphasis added]  
Therefore, as part of its injury analysis, for each class of goods with a significant increase in  
imports, the Tribunal considers whether the increase resulted from “unforeseen developments” and  
the effect of Canada’s obligations, including tariff concessions. Before a safeguard measure can be  
applied, both unforeseen developments and the effect of GATT 1994 obligations must be shown to  
exist.102 The Tribunal must explain how evidence of unforeseen developments and GATT 1994  
obligations or concessions undertaken by Canada demonstrates the existence of the “circumstances”  
in the first clause of Article XIX:1(a).103  
Unforeseen developments  
“Unforeseen developments” are developments that would have been “unforeseen” or  
“unexpected” at the time the importing WTO member undertook relevant GATT 1994  
99. Section 1, Order.  
100. Steel Goods at 9.  
101. The first clause in Article XIX:1(a) does not establish independent conditions, but rather describes  
certain circumstances that must be demonstrated as a matter of fact. Ukraine Definitive Safeguard  
Measures on Certain Passenger Cars (20 July 2015), WTO Docs. WT/DS468/R and Add. 1, Report of  
the Panel [Ukraine Passenger Cars] at para. 7.52, citing Korea Definitive Safeguard Measure on  
Imports of Certain Dairy Products (21 December 1999), WTO Docs. WT/DS98/AB/R, Report of the  
Appellate Body at para. 85 [Korea Dairy] and Argentina Footwear at para. 92.  
102. For safeguards to be applied on imports of several different products, “the demonstration of ‘unforeseen  
developments’ must be performed for each product subject to a safeguard measure.” US Steel at  
para. 319; US Lamb at paras. 72 and 76; Ukraine Passenger Cars at para. 7.52.  
103. Ukraine Passenger Cars at paras. 7.52-7.54.  
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obligation(s).104 More specifically, unforeseen developments are “developments occurring after the  
negotiation of the relevant tariff concession which it would not be reasonable to expect that the  
negotiators of the country making the concession could and should have foreseen at the time when  
the concession was negotiated.”105 The Tribunal is expected to demonstrate the existence of  
unforeseen developments, and explain how they resulted in increased imports.106  
The existence of relevant unforeseen developments can be established by evidence  
provided by the domestic industry.107 The Tribunal must provide reasoned and adequate  
explanations to show how the developments were unexpected or unforeseen,108 and resulted in  
increased imports.109 This includes explaining the timing of events that form the basis of the  
unforeseen developments in order to show that there is a temporal connection between the events  
themselves and the increase in imports.110  
Canada’s GATT 1994 obligations respecting the seven classes of steel goods, specifically  
the relevant tariff concessions, were undertaken by Canadian negotiators in the Uruguay Round of  
Multilateral Trade Negotiations. The issue is whether the increase in imports resulted from  
developments that could not have been reasonably foreseen by trade negotiators in 1994, when  
Canada undertook obligations applicable to the subject steel goods.111  
Ultimately, the issue is not whether an increase in imports was unforeseen.112 Rather, the  
issue is whether there were unforeseen developments that resulted in or led to the import surge.113  
In matters related to international trade in steel, the overarching unforeseen development  
since 1994 is the continuing and increasing overcapacity in world steel production. While there may  
have been excess steelmaking capacity in 1994, it could not be foreseen that such a situation would  
not only persist, but dramatically worsen for over two decades, i.e. until the present time. As noted  
above, since 2000, global crude steelmaking capacity has more than doubled from 1,061 million  
tonnes to an estimated 2,290.7 million tonnes in 2018.114 Over the same period, beginning just prior  
to China’s accession to the WTO, China’s crude steelmaking capacity has increased sevenfold from  
149.6 million tonnes in 2000 to an estimated 1,048.0 million tonnes in 2018.115 Since 2000, the  
104. Korea Dairy at para. 86; Argentina Footwear at para. 93. Events that have been found to constitute  
“unforeseen developments” include: an increase in non-domestic production capacity, higher domestic  
demand, decreased demand in major markets, and currency depreciation. See India Certain Measures  
on Imports of Iron and Steel Products (6 November 2018), WTO Doc. WT/DS518/R, Report of the  
Panel [India Steel] at para. 7.97.  
105. Argentina Footwear at para. 96, citing the Report of the Intersessional Working Party on the  
Complaint of Czechoslovakia Concerning the Withdrawal by the United States of a Tariff Concession  
under the Terms of Article XIX, GATT/CP/106, adopted 22 October 1951.  
106. Ukraine Passenger Cars at para. 7.67; India Steel at para. 7.88.  
107. Ibid.  
108. Ibid. at 7.95.  
109. Ibid. at para. 7.87.  
110. Ibid. at para. 7.114.  
111. Argentina Definitive Safeguard Measure on Imports of Preserved Peaches (14 February 2003), WTO  
Docs. WT/DS238/R, Report of the Panel [Argentina Preserved Peaches] at paras. 7.25-7.29; U.S. –  
Steel at para. 10.74.  
112. Ukraine Passenger Cars; Argentina Preserved Peaches.  
113. Ibid.  
114. Exhibit GC-2018-001-066.29, Vol. 1 at 4.  
115. Ibid.  
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global crude steelmaking capacity-to-consumption gap has more than tripled from just over  
200 million tonnes to approximately 650 million tonnes in 2016.116  
Continued and increasing overcapacity of this magnitude and duration was not, and could  
not have been predicted in 1994, as it could not be forecast by market mechanics. Instead, numerous  
complex socio-political factors, such as the continuing transition of China’s industry and economy,  
were at play to continue and exacerbate this overcapacity.  
A second unforeseen development was the imposition of measures regarding steel imports  
by U.S. President Trump pursuant to a self-initiated investigation under section 232 of the Trade  
Expansion Act of 1962. This section authorizes the President of the United States, through tariffs or  
other means, to adjust the imports of goods or materials from other countries if it is found that the  
quantity or circumstances surrounding those imports threaten to impair national security. President  
Trump imposed the section 232 measures on steel (and aluminum) from most countries in early  
2018, and extended the coverage to include Canada on May 31, 2018.117  
The product-specific parts of this Report also discuss these and other issues related to  
unforeseen developments.  
Obligations under GATT 1994  
Article XIX:1(a) requires identification of the specific obligations (including tariff  
concessions), and the effect thereof, that resulted in the increase in imports.118 The Tribunal’s report  
is expected to identify the relevant GATT 1994 obligation(s), and to explain how the obligation(s)  
limits its ability to react to the import surge causing injury.119  
There are several such obligations identified by the Tribunal. These include the facts that  
Canada:  
committed not to impose quantitative restrictions under Article XI of GATT 1994, and  
bound the tariff applicable to the seven classes of goods at zero percent.  
Article II of GATT 1994 established Schedules of Concessions that set out the WTO  
Members’ tariff concessions. Article II provides that products for which tariff concessions were  
made should be exempt from ordinary customs duties in excess of those provided in the  
Schedule.120 As a result, not only did tariff concessions reduce tariffs, they prevented WTO  
116. Ibid. at 12.  
117. The Tribunal believes this to be the first time this section 232 has been used since the creation of the  
WTO in 1995.  
118. Ukraine Passenger Cars at para. 7.96.  
119. India Steel at para. 7.89.  
120. For example, Article II:1(b) provides as follows:  
(b) The products described in Part I of the Schedule relating to any contracting party, which are the products  
of territories of other contracting parties, shall, on their importation into the territory to which the Schedule  
relates, and subject to the terms, conditions or qualifications set forth in that Schedule, be exempt from  
ordinary customs duties in excess of those set forth and provided therein. Such products shall also be exempt  
from all other duties or charges of any kind imposed on or in connection with the importation in excess of  
those imposed on the date of this Agreement or those directly and mandatorily required to be imposed  
thereafter by legislation in force in the importing territory on that date.  
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Members from unilaterally applying higher tariffs, except under exceptional circumstances.  
Therefore, under Article II and the related Schedules of Concessions, a WTO member cannot  
impose tariffs above the bound tariff rate.  
A tariff binding is a tariff concession, and represents an obligation not to raise the tariff  
above the bound rate.121 Thus, the effect of a bound tariff is that it limits the ability of a WTO  
member to increase the tariff to stem the flow of increased imports.  
As such, the bound tariffs and the inability to impose quantitative restrictions regarding the  
seven classes of goods prevented Canada from addressing any significant increase in imports.  
However, the Agreement on Safeguards continued to provide an emergency mechanism (including  
quotas, TRQs or duties) to deal with such fairly traded goods including steel products.  
Therefore, for classes of subject goods with a significant increase in imports, the Tribunal  
has examined whether the increase resulted from the applicable Canadian concessions and related  
obligations including those not to impose a higher tariff.  
Serious injury  
The Order requires the Tribunal to determine, assuming the relevant conditions precedent  
discussed above are satisfied, whether imports of the subject goods are a principal cause of serious  
injury to domestic producers.122 “Serious injury” is defined as meaning, in relation to domestic  
producers of like or directly competitive goods, a “significant overall impairment in the position of  
the domestic producers.123 Serious injury is clearly more than material injury as the latter term is  
used in the Special Import Measures Act124 proceedings. Given the definitions and the context,  
which is that safeguard measures are emergency ones, the Tribunal views this determination as  
having a high threshold and as being product-specific. In examining whether the domestic industry  
suffered serious injury, the Tribunal was required to evaluate all relevant factors that have a bearing  
on domestic producers of like or directly competitive goods, including actual changes in the level of  
production, employment, sales, market share, profits and losses, productivity, return on investment,  
utilization of production capacity, cash flow, inventories, wages, and growth or the ability to raise  
capital or investments.125  
121. The WTO’s Dictionary of Trade Policy Terms defines this term in part as follows: “Binding: also called  
concession. A legal obligation not to raise tariffs on particular products above the specified rate agreed in  
WTO negotiations and incorporated in a country’s schedule of concessions” (online at  
http://ctrc.sice.oas.org/trc/WTO/Documents/Dictionary%20of%20trade%20%20policy%20terms.pdf).  
122. Order, subsection 3(1).  
123. CITT Act, section 2. Under Article 4.1(a) of the Agreement on Safeguards, “serious injury” is defined as  
“a significant overall impairment in the position of a domestic industry.” “Serious injury” is similarly  
defined under Article 805 of NAFTA.  
124. R.S.C., 1985, c. S-15 [SIMA].  
125. CITT Act, subsection 5(4). The Tribunal notes that whether a domestic producer missed or would miss  
an internal target for profits or return on investment does not necessarily translate into a significant  
overall impairment, i.e. serious injury, or threat of serious injury to a domestic industry. The Tribunal has  
previously indicated that, in the context of SIMA, internal targets are not performance indicators that, in  
and of themselves, concern the Tribunal. Gypsum Board (20 August 2018), PI-2018-003 (CITT) at  
para. 60.  
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Similarly, Article 4.2(a) of the Agreement on Safeguards and paragraph 9 of Annex 803.3  
of NAFTA also require the Tribunal to consider a list of relevant factors, all of which are reflected in  
the factors identified above.126  
Principal cause of serious injury  
Where the Tribunal finds that the domestic producers have suffered serious injury, it must  
assess whether the increased imports are a principal cause of that serious injury.127 “Principal cause”  
is defined as meaning an important cause that is no less important than any other cause of the  
serious injury or the threat thereof.128 A causal link between the increased imports and serious  
injury must be established, and serious injury caused by factors other than increased imports must  
not be attributed to increased imports.129  
As part of this analysis, the Tribunal was required to examine the effect of imported subject  
goods on prices of like or directly competitive goods produced and sold in Canada.130 Specifically,  
the Tribunal had to consider whether:  
the prices of the imported goods significantly undercut the prices of like or directly  
competitive goods produced and sold in Canada; and  
the effect of the imported goods was to depress significantly the prices of, or to limit to  
a significant degree increases in the prices of, like or directly competitive goods  
produced and sold in Canada.131  
For the purpose of determining whether there is a causal link between the increased imports  
and the serious injury or threat thereof, the Tribunal considers the effect of the increased imports on  
the domestic producers, and takes steps to ensure that any injury caused by other factors is not  
attributed to the increase in imports.132 Specifically, the Tribunal examines other factors potentially  
causing injury, and if such factors have caused injury, the Tribunal evaluates whether the impact of  
the injurious factors was more important than the impact of the increase in imports.133  
Threat of serious injury  
When the Tribunal finds that there has been a significant increase in the importation of a  
good, but that there was no serious injury or increased imports were not a principal cause of serious  
injury, the Tribunal must determine whether the increased imports are a threat of serious injury.134  
Threat of serious injury means serious injury that, on the basis of facts, and not merely of  
126. The Tribunal’s Notice of Commencement of Inquiry includes a consolidated list of the injury factors  
enumerated in the Order and in section 5 of the CITT Regulations.  
127. Order, subsection 3(1), and CITT Act, paragraph 20(a).  
128. CITT Act, subsection 19.01(1). The definition applies to inquiries under section 20 of the CITT Act.  
129. Agreement on Safeguards, Article 4.2. Paragraph 10, Annex 803.3, NAFTA, has similar requirements.  
130. CITT Regulations, subsections 5(1) and 5(3).  
131. Ibid.  
132. Bicycles and Frames at para. 107.  
133. Ibid.  
134. Order, subsection 3(1).  
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allegations, conjecture or remote possibility, is clearly imminent.135 Article 4.1(b) of the Agreement  
on Safeguards, as well as Article 805 of NAFTA, defines this term in a similar manner.  
The Tribunal is therefore mindful that a determination of threat is to be based on facts and  
not on “conjecture”.136 Further, the Tribunal notes the following guidance from the WTO’s  
Appellate Body:  
. . . [W]e see the word clearly, which qualifies the word imminent, as an indication that  
there must be a high degree of likelihood that the anticipated serious injury will  
materialize in the very near future. We also note that Article 4.1(b) provides that any  
determination of a threat of serious injury shall be based on facts and not merely on  
allegation, conjecture or remote possibility.” To us, the word “clearly” also relates to the  
factual demonstration of the existence of the “threat”. Thus, the phrase “clearly imminent”  
indicates that, as a matter of fact, it must be manifest that the domestic industry is on the  
brink of suffering serious injury.137  
[Italics in original; bold added for emphasis]  
On a related point, the WTO Panel in U.S. Coated Paper (Indonesia) observed the  
following:  
. . . [I]t is the essence of a threat determination that the situation existing during the POI is  
predicted to change such that there will be injury in the imminent future, if measures are not  
imposed. The lack of present material injury caused by subject imports may be a  
consequence of their volumes during the POI, their price effects, their impact during the  
POI or the injurious effects of other factors. What is important in a determination of threat  
of injury is that the investigating authority adequately explains, based on the evidence  
before it, why the situation it predicts can be projected to occur.138  
[Emphasis added]  
In conducting its analysis of whether there is a threat of serious injury, the Tribunal first  
assessed the state of the market in the most recent part of its POI, i.e. during the first half of 2018, in  
order to assess likely future events. The Tribunal has taken into account the evidence received on  
demand, prices, and the general economic and financial situation for steel for 2018 in Canada, and  
world markets. Then, the Tribunal considered whether an evaluation of the factors listed under  
subsection 5(4) of the CITT Regulations indicated that a negative impact would materialize in the  
near future; in this inquiry, the near future is generally meant to be the next 12 months, i.e. within  
calendar year 2019.  
Principal cause of threat of serious injury  
Where the Tribunal finds that the domestic producers are threatened with serious injury, it  
must assess whether the increased imports are a principal cause of this threat.139 As with serious  
injury, a causal link between the increased imports and the threat of serious injury must be  
135. CITT Act, subsection 2(1).  
136. Agreement on Safeguards, Article 4(1)(b).  
137. US Lamb at para. 125.  
138. United States Anti-Dumping and Countervailing Measures on Certain Coated Paper from Indonesia  
(6 December 2017), WTO Docs. WT/DS491/R, Report of the Panel at para. 7.313.  
139. Order, subsection 3(1); CITT Act, paragraph 20(a).  
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established under the provisions of the Agreement on Safeguards, and serious injury which will be  
caused by factors other than increased imports must not be attributed to increased imports.140  
In assessing whether there is a causal link, the Tribunal considered what would be the effect  
of imported subject goods on prices of like or directly competitive goods produced and sold in  
Canada.  
Goods of certain free trade agreement partners  
Panama, Peru, Colombia, Honduras and Korea  
Where the Tribunal finds serious injury or threat thereof, it must conduct a separate analysis  
in respect of goods imported from Canada’s free trade agreement partners of Panama, Peru,  
Colombia, Honduras and Korea. The analysis has two parts.  
First, where the Tribunal determines that imports of a class of goods from all subject  
sources are being imported in such increased quantities and under such conditions as to be a  
principal cause of serious injury, or threat of serious injury, to the domestic producers of like or  
directly competitive goods, the Tribunal shall determine whether imports of the goods from  
Panama, Peru, Colombia, Honduras and Korea,141 each taken on their own, are a principal cause of  
the serious injury or threat of serious injury.142  
Second, where the Tribunal determines that imports of a class of goods from Panama, Peru,  
Colombia, Honduras or Korea are not a principal cause of serious injury or threat thereof, it must  
then determine whether all the goods of that class were imported into Canada from all other  
countries subject to the inquiry that are not covered by any such determination, in such increased  
quantities and under such conditions as to be a principal cause of serious injury or threat thereof to  
domestic producers of like or directly competitive goods.143  
Mexico (energy tubular and wire rod)  
If the Tribunal finds serious injury or threat thereof regarding energy tubular products or  
wire rod, it must also conduct a separate analysis in respect of such goods imported into Canada  
from Mexico.144 The analysis has two parts.  
First, where the Tribunal determines that imports of energy tubular products or wire rod  
from all subject sources are being imported in such increased quantities and under such conditions  
as to be a principal cause of serious injury, or threat of serious injury, to the domestic producers of  
like or directly competitive goods, the Tribunal must determine whether the quantity of such goods  
imported from Mexico accounts for a substantial share of total imports of goods of the class in  
question; and the goods imported from Mexico contribute importantly to the injury or threat  
140. Article 4.2, paragraph 10. Annex 803.3, NAFTA, has similar requirements.  
141. The Tribunal must assess whether specified imported goods from Korea and goods of the same kind  
imported from other countries are being imported in increased quantities “in absolute terms” (CITT Act,  
section 20.07).  
142. CITT Act, sections 20.031, 20.04, 20.05, 20.06 and 20.07.  
143. Order, section 5.  
144. Order, section 4.  
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thereof.145 “Contribute importantly” means an important cause, but not necessarily the most  
important cause.146  
Second, where the Tribunal determines that energy tubular product or wire rod imports  
originating in Mexico do not account for a substantial share of total imports of the class of goods at  
issue or do not contribute importantly to serious injury or threat thereof, it must then determine  
whether all the goods of that class were imported into Canada from all other countries subject to the  
inquiry that are not covered by any such determination, in such increased quantities and under such  
conditions as to be a principal cause of serious injury or threat thereof to domestic producers of like  
or directly competitive goods.147  
RECOMMENDATIONS ON APPROPRIATE REMEDIES  
The Order provides as follows:  
[I]f the Tribunal determines that importation of the goods of a class described in the  
schedule is a principal cause of serious injury or threat thereof to domestic producers of like  
or directly competitive goods, the Tribunal must make recommendations, in respect of each  
class of goods, as to the most appropriate remedy to address, over a period of three years,  
the injury caused or threatened to be caused by increased importation into Canada of that  
class of goods, in accordance with Canada’s rights and obligations under international trade  
agreements.148  
Three different types of trade measures are commonly used to remedy serious injury or  
threat thereof caused by increased imports. The first is simple surtaxes, which apply to all imports  
irrespective of their volume. The second is quotas, which establish an upper limit on the absolute  
volume of imports that can enter the market within a given period of time. Finally, there are TRQs,  
which impose different tariff rates below and above a predetermined import volume threshold.  
The Tribunal asked parties to consider potential remedies in their submissions. The  
Tribunal considered all of the evidence and argument presented on the subject of remedies,  
including the relative suitability of the three types of remedies available.  
As will be discussed later in this report, the Tribunal is recommending that TRQs be  
applied on imports of the two products for which it is recommending a remedy.  
Indetermining the appropriate level of the above-quota surtax, the Tribunal considered  
various factors including (1) the threat of serious injury caused by increased imports, (2) the views  
of the various parties on the level of surtax required, (3) the methodologies suggested by various  
parties for establishing a surtax, (4) domestic prices during the POI, and (5) the recent developments  
in the market for each of the products. In formulating its recommendations where threat of injury to  
a domestic industry was found, the Tribunal has taken into account the needs of those domestic  
producers as well as the interests of the downstream industries. The Tribunal believes that there is  
an important public interest issue in achieving a balanced recommendation on remedy, one that  
removes the threat of serious injury to the domestic producers from increased imports, while, at the  
same time, minimizing the costs to the Canadian economy.  
145. CITT Act, section 20.01.  
146. CITT Act, subsection 20.01(1), and Article 805, NAFTA.  
147. Order, section 4.  
148. Order, subsection 6(1).  
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In this approach, the Tribunal is taking into account the positions of all interested parties  
and is recommending that safeguard measures be applied only to the extent necessary to offset the  
threat of serious injury being caused by increased imports, and in a manner consistent with  
Canada’s international obligations, including Article 7.4 of the Agreement on Safeguards, which  
provides that, in order to facilitate adjustment, the Member applying the safeguard measures shall  
progressively liberalize them at regular intervals during the period of application.  
The Tribunal also believes that the Government should periodically review these measures  
to ensure that they remain appropriate. This recommendation reflects the fact that Canadian and  
global market conditions could change significantly during the period of the application of the  
measures. Also, the Government should take account of the manner in which trade measures on  
steel are applied in the United States, the European Union or other jurisdictions and of any changes  
that may be made there in response to market or other conditions.  
Article 2(2) of the Agreement on Safeguards provides that safeguard measures shall be  
applied to a product being imported irrespective of its source. However, the Tribunal was directed  
by section 5 of the Order to exclude from any remedy, steel goods originating in Panama, Peru,  
Colombia, Honduras and Korea, if they are not found to be a principal cause of serious injury or  
threat of serious injury. In this case, the Tribunal would recommend that measures be applied to  
imports from any remaining countries. In addition, the Tribunal’s recommendations on remedy do  
not apply to imports originating in the United States, Chile, Mexico,149 Israel or other CIFTA  
beneficiary.  
Article 9.1 of the Agreement on Safeguards provides that “safeguard measures shall not be  
applied against a product originating in a developing country Member as long as its share of imports  
of the product concerned in the importing Member does not exceed three percent, provided that  
developing country Members with less than three percent import share collectively account for not  
more than nine percent of total imports of the product concerned.”  
Similarly, subsection 6(2) of the Order provides that the Tribunal’s recommendations must  
not address goods of a class that are being imported from a country benefiting from the GPTand  
originating in that countryfor which importation of the goods of that class did not, in 2017,  
exceed 3 percent of the total importation of goods of that class, provided that the importation of  
goods of that class from all countries benefiting from the GPT did not, in 2017, exceed 9 percent of  
the total importation of goods of that class.  
Consequently, the Tribunal recommends that imports from countries benefiting from the  
GPT that meet these conditions be excluded from the application of safeguard measures.  
149. Except in the case of energy tubular products and wire rod.  
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PART IV HEAVY PLATE  
PRODUCT  
The first class of goods subject to the Tribunal’s inquiry is heavy plate. The Order provides  
the following description of this class of goods:150  
Hot-rolled carbon steel plate and high-strength low-alloy steel plate not further  
manufactured than hot-rolled, heat-treated or not, in widths from 80 inches (± 2,030 mm) to  
152 inches (± 3,860 mm), and thicknesses from 0.375 inches (± 9.525 mm) to 4.0 inches  
(101.6 mm), with all dimensions being plus or minus allowable tolerances contained in the  
applicable standards. For greater certainty, these dimensional restrictions apply to steel  
plate, which contains alloys greater than required by recognized industry standards  
provided that the steel does not meet recognized industry standards for an alloy-  
specification steel plate.  
The following goods are excluded:  
all plate in coil form, and  
all plate having a rolled, raised figure at regular intervals on the surface (also  
known as floor plate).  
Heavy plate that is the subject of this inquiry is a subset of “plate” as defined for numerous  
previous SIMA proceedings;151 heavy plate is a wider and thicker type of plate. In those  
proceedings, the Tribunal has made numerous factual findings in terms of methods of production  
and product characteristics for plate and those findings are relevant here. The Tribunal takes judicial  
notice and adopts the following:  
While details vary from mill to mill, the process by which plate is produced from  
molten steel generally consists of the following steps: slab production, descaling,  
rolling, levelling and cutting to size; the plate is then tested and shipped. Plate may be  
heat-treated in processes that may include annealing, normalizing, stress relieving,  
quenching, tempering or combinations of these treatments.152  
Plate formed directly into rectangular shapes is referred to in the steel industry as  
“discrete plate” and may be produced in any thickness covered by the product  
definition. The rectangular shapes can also be produced by unwinding plate that has  
been formed into coils and cutting it into separate lengths. Such plate is referred to as  
“plate from coil” or “cut-to-length plate”.153  
Heavy plate is used in a number of applications, the most common of which are the  
production of rail cars, oil and gas storage tanks, heavy machinery, agricultural  
150. In addition, the Department of Finance published an illustrative list of HS Codes for heavy plate, which  
are 7208.51.00.10, 7208.51.00.93, 7208.51.00.94, 7208.51.00.95, 7208.52.00.10, 7208.52.00.93 and  
7208.52.00.96: Exhibit GC-2018-001-01A, Vol. 1 at 3.  
151. See, for example, Plate from Ukraine (30 January 2015), RR-2014-002 (CITT) [Plate from Ukraine];  
Plate from Korea et al. (20 May 2014), NQ-2013-005 (CITT) [Plate from Korea et al.]; Plate from  
Bulgaria et al. (7 January 2014), RR-2013-002 (CITT) [Plate from Bulgaria].  
152. Plate from China (9 August 2018), RR-2017-004 (CITT) at para. 13.  
153. Ibid. at para. 14.  
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equipment, bridges, industrial buildings, high-rise office towers, automobile and truck  
parts, ships and barges, and pressure vessels.154  
Plate is a commodity product that is sold on the basis of price, all other criteria being  
equal.155 Its production is capital-intensive and exhibits high fixed costs of production,  
which provide an incentive for steel mills to increase production to cover these costs.156  
SUMMARY  
The Tribunal finds that heavy plate from the subject countries (other than goods originating  
in Korea, Panama, Peru, Colombia and Honduras) is being imported in such increased quantities  
and under such conditions as to be a principal cause of a threat of serious injury to the domestic  
industry. The Tribunal therefore recommends a remedy in the form of a TRQ on imports of heavy  
plate from subject countries, other than goods originating in Korea, Panama, Peru, Colombia,  
Honduras, or countries whose goods are eligible for GPT treatment.  
ANALYSIS  
The legal principles applicable to the analysis are set out in Part III of this report.  
Like or directly competitive goods  
The like goods are goods of the same description as above, manufactured in Canada.  
Although parties opposing the imposition of safeguard measures contested the ability of the  
domestic industry to make all specifications of heavy plate, they did not present any evidence or  
argument that the domestic industry did not produce like goods. The Tribunal considered these  
arguments not to be relevant to a like-product analysis in the context of this safeguard inquiry.  
Those arguments may be relevant in the context of a like-product analysis under SIMA where  
parties can argue that there is more than a single class of goods within the definition of like goods or  
in the context of an exclusion request. However, the Order expressly indicates that heavy plate  
constitutes a single class of goods and specifically instructed the Tribunal not to hear any motion to  
exclude any good from a class of goods or that would otherwise limit the scope of the inquiry,  
determination or recommendations.  
The evidence was that domestic heavy plate is identical to, or has uses and other  
characteristics that closely resemble, the imported heavy plate that is the subject of this inquiry.157  
On the basis of evidence on the record, the Tribunal finds that domestically produced heavy plate is  
like goods or directly competitive goods to the subject imported heavy plate.  
Domestic producers  
Three domestic producers of heavy plate in Canada responded to the Tribunal’s Producers’  
Questionnaire. They are Algoma Steel Inc. (formerly Essar Steel Algoma Inc., [Algoma]), SSAB  
154. Ibid. at para. 15.  
155. Plate from Ukraine at para. 88; Plate from Bulgaria et al. at para. 32; Plate from Korea et al. at para. 96.  
156. Exhibit GC-2018-001-071.06, Vol. 5 at 27, 45-46; Exhibit GC-2018-001-072.06 (protected), Vol. 6  
at 27, 45-46; Plate from China (8 January 2013), RR-2012-001 (CITT) at paras. 99-101.  
157. Exhibit GC-2018-001-020.08, Vol. 3.  
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Central Inc. (SSAB) and Janco Steel Ltd. (Janco).158 Algoma, by far the largest domestic  
producer,159 is an integrated steel mill located in Sault Ste. Marie, Ontario. SSAB is a steel service  
centre located in Scarborough, Ontario, and Janco is a steel service centre located in Stoney Creek,  
Ontario.  
Parties opposing did not present any evidence or argument that there were any other  
significant domestic producers.  
Therefore, the Tribunal finds that the collective output of these producers constitutes a  
major proportion of the total domestic production of heavy plate.  
Increase in imports  
Table 1 shows the volume of imports of heavy plate into Canada for the period of  
January 1, 2015, to June 30, 2018.  
Table 1  
Imports of Heavy Plate (Volume)  
(Tonnes)  
Interim  
2015  
2016  
74,261  
497,191  
2017  
2017  
56,049  
241,015  
2018  
51,284  
190,305  
Subject  
Countries  
Total Imports  
106,574  
474,141  
147,373  
535,622  
Source: Exhibit GC-2018-001-05B, Vol. 1.1 at 16.  
158. Samuel, Son & Co., Limited (Samuel) is a service centre which likely produces some like goods at  
various locations in Canada. It was asked to complete a Producers’ Questionnaire. Samuel was not  
included in the Statistical Summary as a domestic producer because, after several revisions, its response  
to the questionnaire was not viewed as reliable. Samuel’s revised response indicated that the amount of  
its production within the scope of the inquiry is a minor proportion of domestic production: Exhibit GC-  
2018-001-104 (protected), Vol. 2; Exhibit GC-2018-001-105 (protected), Vol. 2 and Exhibit GC-2018-  
001-108 (protected), Vol. 2. The part of Samuel’s response regarding its imports was included as part of  
importer data. Several other steel service centres that produced substantial volumes of plate within the  
scope of previous proceedings responded to the Producers’ Questionnaire that they did not produce  
heavy plate as defined in this inquiry, for example: Acier Nova Inc. (Exhibit GC-2018-001-20.06, Vol. 3  
at 1-2), Del Metals (Exhibit GC-2018-001-20.04, Vol. 3 at 1-2), Evraz Inc. NA Canada (Exhibit GC-  
2018-001-20.07, Vol. 3 at 1-3), Russel Metals Inc. (Exhibit GC-2018-001-20.03, Vol. 3 at 1-2), Varsteel  
Ltd. (Exhibit GC-2018-001-20.13, Vol. 3 at 1-2). As well, a previously unknown domestic producer,  
High Strength Plates & Profiles Inc. (HSPP), made itself known to the Tribunal. HSPP did not provide  
any production data, but did complete an Importers’ Questionnaire: Exhibit GC-2018-001-35.04,  
Vol. 3.1. HSPP is also very likely to account for a very minor amount of domestic production, as it was  
completely unknown to the industry and the Tribunal in all previous Plate proceedings.  
159. Since Algoma is such a large part of the domestic industry, much of the domestic industry’s information  
(including trends in financial performance) was kept confidential in order to protect Algoma’s business  
interests and the integrity of the Tribunal process.  
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Parties opposing the imposition of a safeguard remedy argued that there was no increase in  
imports which satisfied the requirements of Canadian law and the Agreement on Safeguards. Parties  
supporting the imposition of a safeguard remedy had a contrary position. They also introduced  
evidence from Statistics Canada regarding imports in Q3 of 2018.160  
Table 1 shows that, in absolute terms, the volume of subject imports of heavy plate into  
Canada decreased in 2016 as compared to 2015, but then suddenly and sharply increased by  
approximately 73,000 tonnes in 2017. In percentage terms, the increase of 98 percent in 2017 was  
the sharpest year-on-year increase observed for any class of goods in this inquiry. While the volume  
in 2016 was much reduced as compared to the 2015 volume, the volume in 2017 was still  
38 percent greater than the 2015 volume.  
Subject imports decreased by nine percent in interim 2018 as compared to interim 2017,  
but this rate of decrease nevertheless implies that the volume of subject imports was on pace to  
remain at a sharply higher volume compared to the full years 2015 and 2016. This is because a  
simple comparison of the first halves of 2017 and 2018 masks the fact that most of the increase in  
subject imports in 2017 (approximately 60 percent) occurred in the second half of the year.  
In terms of assessing the most recent trends in the volume of subject imports, the Tribunal  
determined that, in the case of heavy plate, Statistics Canada data were reliable and useful, with  
imports in the prior two quarters tracking the data compiled by the Tribunal.161 The Statistics  
Canada import data for 2018 show that the volume of subject imports up to the end of the third  
quarter of 2018 was 118,284 tonnes, which was already greater than the full-year volume for  
2015.162  
The ratio of subject imports to domestic production163 increased along a similar trend. In  
2016, the ratio decreased by 12 percentage points, but then increased by 38 percentage points in  
2017, for a net increase of 20 percentage points over the three-year period. There was an increase of  
one percentage point in interim 2018 as compared to interim 2017. In other words, while there was  
an absolute decrease in subject imports in interim 2018, there was no decrease relative to domestic  
production.  
160. The general discussion concerning the admissibility of Q3 2018 data is contained in Part II above. In the  
case of heavy plate, parties opposed argued that the Statistics Canada data was neither admissible nor  
reliable.  
161. The Tribunal conducted an analysis to assess the accuracy of the Statistics Canada import volume data  
regarding heavy plate by comparing the first half 2017 and first half 2018 Statistics Canada data with the  
data regarding these same periods as presented in the Tribunal’s Statistical Summary for Plate. The  
Tribunal’s analysis showed that its data represented 97 percent and 95 percent of the Statistics Canada  
data for first half 2017 and first half 2018, respectively. Therefore, the Tribunal has concluded that the  
Statistics Canada data for imports of heavy plate in Q3 2018 is accurate and useful for the purposes of its  
inquiry regarding this class of goods: Exhibit GC-2018-001-071.06, Vol. 5 at 12.  
162. Testimony indicated that seasonal patterns in demand for imports remained stable in the Canadian  
market throughout the POI, which suggests that subject imports in the first half of 2018 (51,284 tonnes)  
would be less than half the annual total. Therefore, the annual total in 2018 is very likely to be at least  
127,000 tonnes, i.e. well in excess of the 106,574 tonnes imported in 2015: Transcript of Public Hearing  
at 54; Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 16.  
163. The volume of domestic production itself is confidential: Exhibit GC-2018-001-005B, Vol. 1.1 at 19.  
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This increase in subject imports in 2017 is significant when viewed in the context of the  
Canadian market. Relative to domestic sales from domestic production, imports of the subject  
goods decreased by 20 percentage points in 2016, but then increased by 46 percentage points in  
2017, for a net increase of 26 percentage points over the three-year period. There was also an  
increase of two percentage points in interim 2018 as compared to interim 2017. In other words,  
while there was an absolute decrease in subject imports in interim 2018, there was no decrease  
relative to sales from domestic production. In addition, the increases in subject imports represent a  
sizeable portion of the domestic market.164  
Accordingly, the Tribunal concludes that in 2017, there was an increase in subject imports  
and that the increase in these imports was recent enough, sudden enough, sharp enough and  
significant enough, in absolute terms and relative to domestic production of heavy plate.  
Unforeseen developments and GATT 1994 obligations  
Having found that there was such an increase in subject imports of heavy plate in 2017, the  
Tribunal considers whether the increase resulted from unforeseen developments and the effect of  
Canada’s GATT 1994 obligations.  
Unforeseen developments  
The domestic industry submitted that increasing global overcapacity and various trade  
remedy actions, especially since 2017, were developments which could not be reasonably foreseen  
by Canadian negotiators in 1994. Other parties submitted that these developments were not  
“unforeseen” and could not be linked to the increase in imports.  
For the reasons that follow, the Tribunal finds that the increase in imports was due to a  
combination of unforeseen developments. The overarching unforeseen development is the  
continuing unresolved and substantially increasing overcapacity in world steel production,  
including heavy plate production, which could not be foreseen in 1994.  
The developments in excess capacity for steel generally have been described in Part II  
above.  
Evidence on the record with regard to the global capacity utilization rate on reversing mills  
(which capacity is dedicated exclusively to the production of discrete plate, mostly in the  
dimensions covered by the heavy plate product description) is projected to remain well under 80  
percent through 2020. The excess capacity will remain at about 40 million tonnes in 2019 and 2020,  
which represents many times the size of the total Canadian market for plate in 2017. Evidence  
shows that the majority of this global excess capacity is located in the subject countries.165  
The Tribunal’s record indicates that overcapacity in the new sources of heavy plate imports,  
i.e. Turkey and Malaysia, was high.166 These sources of heavy plate imports in the POI are not  
164. Exhibit GC-2018-001-005B, Vol. 1.1 at 16 and 20; Exhibit GC-2018-001-06B (protected), Vol. 2.1  
at 20.  
165. Exhibit GC-2018-001-071.06, Vol. 5 at 21, 47-49; Exhibit GC-2018-001-072.06 (protected), Vol. 6  
at 21, 47-49.  
166. Transcript of Public Hearing at 51; Exhibit GC-2018-001-066.27, Vol. 1 at 6, 13, 21, 37-40, 43; Exhibit  
GC-2018-001-066.29, Vol. 1 at 4.  
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subject to anti-dumping and countervailing (AD/CV) measures in Canada. The resulting pricing in  
subject countries is persistently much lower than North American prices.167 Subject countries’  
exports of heavy plate are shipped to various destinations around the world, including Canada, if  
there is an opportunity to do so. The ensuing opportunistic and random trade flows were  
unforeseen, and have created a situation resulting in import surges in markets open to such imports  
such as the Canadian market for heavy plate.  
The Tribunal has no doubt that continuing and increasing overcapacity generally, and  
specifically in respect of new sources of heavy plate in the POI, led to the surge of heavy plate into  
Canada in 2017 and that this surge was unforeseen.  
The other unforeseen developments of importance for heavy plate imports into Canada  
were even less predictable, including the major depreciation of the Turkish lira in mid-2017 and  
omnibus U.S. AD/CV measures against plate from, among others, Turkey in early 2017,168 as well  
as the proposed U.S. section 232 measures.169 These led directly to the increase in subject imports  
in 2017.  
GATT 1994 obligations  
In 1994, Canada agreed not to impose quantitative restrictions on trade in goods and bound  
the tariff for heavy plate at zero percent.170 The effect of the concession and the obligations arising  
under Articles II:1(a) and XI of GATT 1994 was to prevent Canada from imposing tariffs above the  
bound tariff rate or quotas as a means of addressing the significant increase in imports of heavy  
plate in 2017.  
Serious injury  
Having found that subject imports have increased, the Tribunal has to determine whether  
serious injury has occurred.  
As determined by the Tribunal and admitted by Algoma, imports increased only as of  
2017; it follows that any injury suffered in 2015 and 2016 cannot be attributed to an increase in  
imports.171 Accordingly, the Tribunal will focus on developments from 2017 on, but will also place  
them in the context of the entire POI.  
167. Transcript of Public Hearing at 16-17; Exhibit GC-2018-001-072.06 (protected), Vol. 6 at 135.  
168. The issue of the depreciation of the Turkish lira as an unforeseen development is discussed at length in  
the Reinforcing Bar chapter where the Tribunal acknowledges that while currency fluctuations per se are  
foreseeable, it is of the view that, in this instance, it was the timing, speed and depth of the depreciation  
of the modern lira within the context of the broader economic instability in Turkey that could not be  
foreseen by negotiators in 1994. Similarly, while countries’ use of AD/CV measures per se are  
foreseeable, the impact of omnibus U.S. AD/CV measures (covering almost a dozen countries) in the  
context of the significant global overcapacity and trade uncertainty could not have been foreseen.  
169. Exhibit GC-2018-001-003B, Vol. 1.1 at 15; Exhibit GC-2018-001-005B, Vol. 1.1 at 37; The Tribunal  
heard evidence that the U.S. section 232 measures resulted in diversion even before their official  
implementation: Transcript of Public Hearing at 14-15.  
170. Exhibit GC-2018-001-066.43, Vol. 1 at 33 et seq.  
171. The causes of injury in 2015-2016 were mainly Algoma’s restructuring from bankruptcy protection,  
which created increased costs and market uncertainty over its operations and viability as a supplier.  
However, Algoma emerged from bankruptcy protection in November 2018: Exhibit GC-2018-001-067,  
Vol. 1 at 1.  
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The following table summarizes the domestic industry’s performance during the POI. All  
financial performance data of the domestic industry (which mainly consists of Algoma’s results)  
gathered by the Tribunal, including percent changes, is confidential, so that not even index results  
can be presented.  
Table 2  
Summary of Domestic Performance Indicators (Index)  
Interim  
2015  
100  
100  
100  
100  
100  
2016  
100  
93  
97  
83  
2017  
100  
91  
103  
64  
2017  
100  
100  
100  
100  
100  
2018  
100  
91  
91  
91  
Practical Plant Capacity  
Total Production  
Production for Domestic Sales  
Production for Export Sales  
Capacity Utilization Rate (%)  
93  
91  
91  
Market  
100  
100  
100  
96  
96  
99  
101  
101  
100  
100  
100  
100  
89  
89  
100  
Domestic Sales from Domestic Production  
Producers Market Share (%)  
Total Direct Employees  
100  
100  
100  
100  
97  
97  
95  
98  
102  
107  
107  
85  
100  
100  
100  
100  
111  
109  
107  
84  
Total Wages ($000) - Direct Employment  
Total Hours Worked (000) - Direct Employment  
Productivity - Tonnes/ Hour Worked (Direct)  
Producer Inventories  
Inventory as % of Production  
100  
100  
87  
95  
88  
97  
100  
100  
125  
138  
Selling Prices  
Domestic Sales from Domestic Production  
Total - Subject Countries  
Excluded Countries  
100  
100  
100  
89  
84  
90  
104  
98  
103  
100  
100  
100  
111  
107  
108  
Total - Subject Goods Market Share  
Excluded Countries - Market Share  
100  
100  
58  
116  
100  
100  
100  
100  
141  
88  
Note(s):  
1. 2015 = 100 and Interim 2017 = 100  
2. Index values are notional, and there is no indexing between a full calendar year and an interim period.  
3. The bolded index values under “Selling Prices” indicate the lowest price in the market for that period.  
Source: Exhibit GC-2018-001-05B, Vol. 1.1 at 15, 22, 25 and 31.  
Algoma publicly presented some significant negative results and trends in key performance  
indicators. Specifically, it presented that it was unable to grow its domestic sales, its productivity  
declined in 2016, 2017 and interim 2018, and its capacity utilization fell from interim 2017 to  
interim 2018. Parties opposed argued that the negative performance was not caused by increased  
imports but rather by other factors, mostly related to Algoma’s restructuring.  
In terms of trends for key performance indicators in 2017, the domestic industry performed  
better in 2017 compared to 2016 despite the increase in subject imports. Its results in 2017 were  
generally positive.  
Indeed, production for domestic sales, domestic sales from domestic production, total  
employment, total hours worked and total wages (as well as financial results) increased in 2017,  
compared to declines in 2016.172 The domestic industry was able to maintain its share of the  
172. Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 27, 31 and 32; Exhibit GC-2018-001-005B, Vol. 1.1  
at 32.  
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expanding market as subject imports took share from imports of U.S. heavy plate.173 The capacity  
utilization rate and inventories in relation to domestic production remained stable.174 Total  
production decreased marginally, entirely due to a decrease in production for export sales.  
Productivity also declined.175  
As stated above, the majority of subject imports in 2017 entered Canada in the latter half of  
2017, so it is not surprising that their impact would not be felt in that year. The selling prices of  
subject imports significantly undercut domestic industry prices during 2017 and increasingly in  
interim 2018, and were the price leaders throughout the POI (except for 2015); conversely, prices of  
imports from the United States were the highest.176  
There was no evidence of price depression at the aggregate level as the selling prices of like  
goods increased throughout the POI. However, as conceded by parties opposing, the domestic  
industry experienced price suppression as evidenced in the movement in and magnitude of its gross  
margin in interim 2018 compared to interim 2017.177  
Moreover, performance for interim 2018 started to show weaknesses particularly in certain  
financial results, as well as in total production (both production for domestic and export sales  
declined), sales volumes, capacity utilization and volumes of inventories.178 The domestic industry  
did not lose market share despite the shrinking market as subject imports continued to gain share at  
the expense of U.S. imports.179  
In summary, throughout the POI, the domestic industry’s performance was weak. On  
balance, however, the Tribunal finds that the domestic industry did not experience a significant  
overall impairment to its position in terms of the duration and magnitude of the impact caused by  
the increased imports, and so did not experience serious injury.  
On the basis of the preceding examination of the domestic industry’s performance  
indicators, the Tribunal finds that the position of the domestic industry has not suffered significant  
overall impairment and has therefore not experienced serious injury.  
The Tribunal will now examine whether the increased subject imports threaten to cause  
serious injury.  
173. Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 20-22; Exhibit GC-2018-001-005B, Vol. 1.1 at 21.  
174. Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 31.  
175. Ibid. at 31-32; Exhibit GC-2018-001-005B, Vol. 1.1 at 32.  
176. The degree of undercutting was greater when comparing importers’ landed prices to domestic selling  
prices, and indicated undercutting even in 2015.  
177. Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 25, 27; see also Exhibit GC-2018-001-070.08  
(protected), Vol. 6 at 24; Exhibit GC-2018-001-072.06 (protected), Vol. 6 at 44.  
178. Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 27, 31-32; Exhibit GC-2018-001-005B, Vol. 1.1 at  
32.  
179. Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 20, 21-22; Exhibit GC-2018-001-005B, Vol. 1.1 at  
21.  
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Threat of serious injury  
Having determined that there were increased imports, but that there was no serious injury to  
the domestic producers, the Tribunal must determine whether there is a threat of serious injury if  
safeguard measures are not imposed.  
The Tribunal is of the view that the increased imports of heavy plate into the Canadian  
market will continue in their elevated amounts. There are distinct supply and demand factors  
contributing to this situation. In terms of supply, the subject imports are being pushed out of their  
domestic and other export markets by continuing and increasing excess capacity in the subject  
countries and trade restrictions in many key markets. There is also a corresponding demand (or pull)  
factor of the Canadian market being relatively high-priced and featuring no trade restrictions on a  
number of subject countries.  
The evidence before the Tribunal also indicates that the price undercutting, which persisted  
through nearly all of the POI, was increasing in magnitude in interim 2018 as compared to prior  
periods including interim 2017.180 Even with imports at current levels, it is likely that the existing  
price undercutting would continue in the next 12 months if safeguard measures are not imposed.  
In view of these circumstances, the Tribunal concludes that, without the protection afforded  
by safeguard measures, the injury experienced by the domestic industry that began in interim 2018  
will imminently become serious, and that the increased imports will be a principal cause thereof.  
The domestic industry argued that it faced a threat of injury, caused by the increased  
imports, and especially in light of a continued diversion of subject imports into Canada and the  
domestic industry’s vulnerable overall condition. Parties opposing the imposition of safeguard  
measures pointed to some of the improving results of the domestic industry in arguing the opposite  
view.  
As noted above, heavy plate is a commodity product that is sold on the basis of price, and  
the high fixed costs of production provide an incentive for steel mills to increase production to  
cover these costs.181  
It is also important to note that importers who are willing to deal with the extra time  
required for offshore heavy plate to be delivered to Canada have obtained the subject goods in large  
quantities and at low prices in the past from a wide variety of sources, and there is no reason to  
think that they will not continue to seek out new sources in the future.182  
With this context, the Tribunal began its analysis of threat of serious injury by assessing the  
current state of both the Canadian and global markets for heavy plate. In that respect, the Tribunal  
considers that current events and indicators are the best predictors of the near future. These included  
the recent volumes of subject imports, and likely future impact of recent U.S. trade remedy  
measures on imports of heavy plate. In addition, the Tribunal took into account the countermeasures  
180. Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 25; Exhibit GC-2018-001-072.06 (protected), Vol. 6  
at 14-16.  
181. Exhibit GC-2018-001-071.06, Vol. 5 at 27, 45-46; Exhibit GC-2018-001-072.06 (protected), Vol. 6 at  
27, 45-46; Plate from China (8 January 2013), RR-2012-001 (CITT) at paras. 99-101.  
182. Transcript of Public Hearing at 48-52.  
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which Canada placed on imports from the United States in mid-2018 as a response to U.S.  
section 232 measures.  
Within Canada, the evidence indicates stable demand for heavy plate in the near to medium  
term.183 The extension of U.S. section 232 measures to Canada and Canada’s imposition of  
countermeasures has fundamentally changed trade flows between Canada and the United States.  
Whereas in the past Canadian plate pricing tended to track the U.S. Midwest price, this is no longer  
the case as the higher U.S. price now reflects the additional protection offered by the section 232  
measures. Nonetheless, compared to markets other than the United States, plate prices in Canada  
are expected to remain relatively high over the short to medium term.184  
Globally, as more fully set out above in the Unforeseen Developments section for steel in  
general, the subject countries exhibit significant plate overcapacity of over 40 million tonnes.185  
Their domestic sales, as well as exports to other jurisdictions, are also constrained by increasing  
low-priced Chinese exports caused by the slowing Chinese economy.186 There is no evidence to  
suggest that demand will increase significantly in other markets to absorb the excess capacity. Also,  
the proliferation of trade remedy measures in various jurisdictions, including the United States and  
the European Union, is restricting their options for other export sales.187  
As evidence of how quickly and easily global trade flows in heavy plate can change, the  
witness for Algoma stated that the surge in subject imports into Canada started when AD/CV  
actions in the United States were imposed in early 2017 on almost a dozen countries.188 In fact, data  
gathered by the Tribunal indicates that some of the countries that contributed most significantly to  
the increase in imports beginning in the second half of 2017 had measures imposed against them as  
part of that proceeding.189 The increased import presence during the fall of 2018 also included  
sources that had been unheard-of in the Canadian market for decades, such as the Republic of North  
Macedonia.190 This further demonstrates that there are ample future sources of subject imports apart  
from those countries that were part of the surge in imports in 2017. It also indicates that even though  
there are many Canadian AD/CV findings on plate in Canada, the Canadian market remains open to  
imports from a wide range of sources.  
In the Tribunal’s view, the phenomenon of increased subject imports experienced in the  
Canadian market in 2017, and persisting in Q3 2018, will continue in the immediate future if  
183. Ibid. at 13, 19, 55; Exhibit GC-2018-001-071.06, Vol. 5 at 59.  
184. Transcript of Public Hearing at 13-17; Transcript of In Camera Hearing at 22-23, 27; Exhibit GC-  
2018-001-072.06 (protected), Vol. 6 at 60-62, Exhibit GC-2018-001-071.06, Vol. 5 at 60-62.  
185. Ibid. at 21.  
186. Ibid. at 22-23. Exhibit GC-2018-001-072.06 (protected), Vol. 6 at 22-23.  
187. Exhibit GC-2018-001-071.06, Vol. 5 at 19-23; Exhibit GC-2018-001-072.06 (protected), Vol. 6 at  
19-23; Exhibit GC-2018-001-005B, Vol. 1.1 at 52; Exhibit GC-2018-001-006B (protected), Vol. 2.1 at  
52.  
188. Transcript of Public Hearing at 15-16; Exhibit GC-2018-001-005B, Vol. 1.1 at 37 (Table 30).  
According to that table, in a decision in early 2017, the United States added the following 10 countries to  
be impacted by anti-dumping and/or countervailing measures on plate: Austria, Belgium, Brazil, France,  
Germany, Italy, Japan, South Africa, Chinese Taipei and Turkey.  
189. Exhibit GC-2018-001-35.21, Vol. 3.1 at 10; Exhibit GC-2018-001-20.10C, Vol. 3 at 8; Exhibit GC-  
2018-001-35.22, Vol. 3.1 at 13.  
190. Exhibit GC-2018-001-071.06, Vol. 5 at 24, 52, 65-66; Exhibit GC-2018-001-072.06 (protected), Vol. 6  
at 24, 52, 65-66, 139; Transcript of Public Hearing at 42.  
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safeguard measures are not imposed. Witnesses stated that subject imports have been filling the gap  
left by imports of heavy plate from the United States.191 Thus, the diversion of subject imports of  
heavy plate originally destined for the United States is already occurring.  
The most likely scenario is that sales of U.S. imports in Canada will continue to be  
displaced by subject imports. First, U.S. imports would continue to face a 25 percent surtax. As  
well, high U.S. domestic prices continue to make the domestic U.S. market (which is protected  
against subject imports) more attractive for U.S. producers than the Canadian market.192 U.S.  
producers are more likely to walk away from sales and not compete on price in the Canadian  
market.  
In terms of the future prices of the subject imports, the Tribunal heard confidential  
testimony about the unchanging commercial rationale for the persistent undercutting of domestic  
prices.193 Subject import sales and offers are already being made at accounts held by both U.S. or  
Canadian producers and such competition will continue.194 Algoma also provided multiple  
examples where it competed against low-priced offers from subject countries and reduced its prices  
to make the sale.195  
Further, underlying market fundamentals suggest that domestic pricing may weaken in the  
future. Although the Canadian price no longer necessarily tracks the Midwest price, that latter price  
is forecast to decline from its high point after Q3 2018.196 To the extent Canada faces a similar  
downward pricing trend, it will only be exacerbated by increased volumes of low-priced subject  
imports.  
As well, the unit cost of goods has been increasing in the later part of the POI and  
especially in interim 2018,197 and there was no evidence presented that it would start to decrease in  
the near term. Future increases in costs would make the domestic industry even more vulnerable to  
price suppression.  
All the above leads the Tribunal to conclude that increasing volumes of low-priced subject  
imports would continue to compete with and displace sales of domestic heavy plate, take sales and  
market share which could have otherwise been held by the domestic industry, and cause either  
continued price suppression, as seen in interim 2018, or outright price depression.198  
Keeping in mind the fragile state of the domestic industry and the early signs of injury seen  
in interim 2018, the evidence shows that such significant future effects would result in significant  
lost profits and financial performance at unsustainable levels in the near future i.e. calendar year  
2019.199 The Tribunal finds that such a decline in financial performance would have a cascading  
overall negative impact on the domestic industry, including preventing Algoma from successfully  
191. Ibid. at 52, 54-55.  
192. Exhibit GC-2018-001-072.06 (protected), Vol. 6 at 60-62.  
193. Transcript of In Camera Hearing at 55.  
194. See, for example, Exhibit GC-2018-001-35.19, Vol. 3.1.  
195. Transcript of In Camera Hearing at 8; Exhibit GC-2018-001-072.06 (protected), Vol. 6 at 14, 151.  
196. Transcript of Public Hearing at 13; Exhibit GC-2018-001-071.06, Vol. 5 at 59, 60-62; Exhibit  
GC-2018-001-072.06 (protected), Vol. 6 at 59, 60-62.  
197. Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 27.  
198. Precise market share information is confidential: Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 22.  
199. Exhibit GC-2018-001-072.06 (protected), Vol. 6 at 26.  
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emerging from its recent restructuring and returning it to its negative performance as seen in the  
earlier part of the POI. Specifically, the impact of such negative financial performance would be  
reductions or a halt to investments currently planned by Algoma,200 layoffs and lost profits, among  
other serious negative consequences. Very quickly, the continuing high levels of volumes of  
lower-priced subject imports would lead to a deterioration in the overall position of the domestic  
industry to such a degree that it would constitute serious injury.  
In sum, the Tribunal concludes that the increased subject imports are a principal cause of a  
threat of serious injury.  
Given that the evidence indicates that the increase in subject imports is likely to be a  
principal cause of threat of serious injury due to continued price suppression and price depression,  
the Tribunal will address whether there are other causes of the threat of serious injury which are  
more important.  
First, the Tribunal considered the effect of further declines in export sales on the domestic  
industry; the domestic industry’s export sales already declined 36 percent from 2015 to 2017 and  
9 percent from interim 2017 to interim 2018. Although the loss of additional export volumes may  
have a negative effect on the domestic industry, it will not be as important as the negative effect of  
the subject imports, as export sales constitute a much smaller portion of total production compared  
to domestic sales. Consequently, the decline in export volumes, and its effect of increasing the fixed  
costs to be borne by domestic sales, would not account for most of the price suppression to be  
suffered in the near future. In this respect, it should be noted that the domestic industry has more  
than ample capacity to replace any lost export sales with domestic sales.  
Second, the Tribunal considered whether imports from the United States, which are the  
bulk of the imports of heavy plate into Canada, are a more important cause of the threat of serious  
injury than the subject imports. The Tribunal’s data does not support such a proposition. During the  
POI, imports from the United States were receding in volume in 2017 and interim 2018, and were  
priced comparably with domestic industry prices.201 As discussed above, there is no reason to think  
that imports from the United States will return to Canada in significant volumes, given the current  
circumstances where U.S. producers can enjoy higher prices in their protected domestic market.  
Finally, none of the important causes of threat of serious injury that may be relevant to  
other products being investigated, including significantly diminished future demand, self-inflicted  
injury due to domestic producer imports, or intra-industry competition, are applicable to heavy  
plate.  
To conclude, the Tribunal is of the view that there are no other causes of the threat of  
serious injury more important, individually or collectively, than increased subject imports.  
Therefore, based on the above review of the evidence, the Tribunal finds that there is a threat of  
serious injury of which a principal cause is the increased subject imports.  
200. Transcript of Public Hearing at 20-21.  
201. Exhibit GC-2018-001-005B, Vol. 1.1 at page 17; Exhibit GC-2018-001-006B (protected), Vol. 2.1  
at 23, 25.  
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Goods of certain free trade agreement partners  
In accordance with the principles discussed in Part III of this report, pursuant to the Order,  
and in accordance with sections 20.031, 20.04, 20.05, 20.06 and 20.07 of the CITT Act, the Tribunal  
conducted the following analysis with respect to imports from Panama, Peru, Colombia, Honduras  
and Korea.  
There were no imports of heavy plate from Panama, Peru, Colombia and Honduras during  
the POI and therefore imports from none of these sources can be on its own a principal cause of a  
threat of serious injury. Accordingly, subject imports from these sources should be excluded from  
the application of any remedy.  
With regard to Korea, although the volume of subject imports from Korea to Canada  
increased in 2017 and interim 2018, the volumes themselves were not nearly as high as those from  
the remaining subject countries.202 In terms of selling prices, the prices of imports from Korea  
declined by 24 percent in 2016, but then increased by 29 percent in 2017. In interim 2018, the price  
of sales of imports from Korea decreased by 4 percent compared to interim 2017.203 According to  
Statistics Canada data, in 2017 and throughout the POI, the unit values of imports from Korea were  
higher than those from other subject countries.204  
Although the Statistics Canada Q3 2018 data shows a marked increase in imports from  
Korea when compared to the previous quarters in 2017 and 2018 (which comprised approximately  
30 percent of subject imports in that quarter unlike previous periods), this single data point does not  
result in the conclusion that imports from Korea are a principal cause of threat of serious injury on  
their own.205  
The Tribunal has analyzed its confidential information regarding volumes and prices of the  
goods from Korea in the POI along with the above evidence.206 The evidence confirms the view  
that Korea has not been a supplier of sufficient volumes or demonstrated significant  
price-leadership in the past and there is nothing in the evidence to lead to the conclusion that the  
volumes of imports from Korea will increase substantially nor that prices of Korean heavy plate  
would undercut those of the domestic industry, suppress or depress domestic prices and thus cause  
any negative effects in future.  
Therefore, the Tribunal concludes that subject imports from Korea on their own are not a  
principal cause of threat of serious injury.  
202. Exhibit GC-2018-001-005B, Vol. 1.1 at 16-17; Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 16.  
Certain Korean plate is subject to AD measures in Canada: Plate from Korea et al.  
203. Exhibit GC-2018-001-005B, Vol. 1.1 at 26.  
204. Exhibit GC-2018-001-071.06, Vol. 5 at 100.  
205. Ibid. at 101. As described above, the interim 2017 and interim 2018 Statistics Canada data for the subject  
countries as a whole track closely those found in the Statistical Summary. However, the same is not true  
with regard to Korea for interim 2017. Therefore, the Q3 2018 Statistics Canada data for Korea may not  
be as reliable in terms of assessing trends for that country on its own.  
206. Exhibit GC-2018-001-006B (protected), Vol. 2.1 at 16, 20, 23, and 25.  
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Given the above finding regarding Korea, the Tribunal must exclude goods imported from  
Korea from its analyses concerning increased imports, threat of injury and causation.207  
Considering the low volumes and relatively high prices of Korean goods in the past, the  
Tribunal’s conclusions with respect of increased imports, serious injury and principal cause of the  
threat of serious injury are the same, or even stronger, when imports from Korea are excluded from  
that group, as the latter goods are part of other subject imports.  
The Tribunal therefore finds that the increased imports (excluding imports from Korea,  
Panama, Peru, Colombia and Honduras) are a principal cause of threat of serious injury.  
207. This concept that “. . . the scope of the serious injury investigation need not correspond exactly to the  
scope of application of a safeguard measure” as long as the injury analysis is done on the basis of the  
goods ultimately subject to the measure, is generally referred to as parallelism: U.S. Wheat Gluten  
(22 December 2000), WTO Docs. WT/DS166/AB/R at paras. 96-98: U.S. Line Pipe (15 February  
2002), WTO Docs. WT/DS202/AB/R at paras. 186-187.  
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REMEDY RECOMMENDATION  
INTRODUCTION  
The Tribunal found that imports of heavy plate from the subject countries (other than goods  
originating from Korea, Panama, Peru, Colombia and Honduras) are being imported in such  
increased quantities and under such conditions, as to be a principal cause of a threat of serious  
injury to the domestic industry. Accordingly the Tribunal recommends a remedy in the form of a  
TRQ on imports of heavy plate from subject countries, other than goods originating in Korea,  
Panama, Peru, Colombia and Honduras, or countries whose goods are eligible for GPT treatment.  
Both the in-quota volumes and the above-quota surtaxes are to be liberalized over the three-year  
quota period.  
The following section explains the reasons for the Tribunal’s choice of remedy, including  
the details of the remedy proposed.  
CHOICE OF REMEDY  
Position of parties  
The Tribunal considered all the evidence and arguments presented on the subject of  
remedies, including the relative suitability of the three types of remedies available, i.e. surtaxes,  
quotas and TRQs. The Tribunal heard witnesses for domestic producers and importers. The  
Tribunal also heard a witness testifying on behalf of the United Steelworkers (USW).  
Algoma and USW argued in favour of TRQs.208 Algoma submitted that a TRQ would  
allow imports to remain at historic levels that will minimally disrupt supply for Canadian  
customers, while protecting the domestic industry from further injury. The surtax would create  
balance, with trade still flowing freely and consumers still having access to imports, but with  
Algoma not being threatened with serious injury by surging imports.209 Algoma argued in favour of  
the current provisional measure, which sets the in-quota volume at 94,301 tonnes, annualized, for  
the first year, with an increase of that in-quota of no more than 10 percent in the second and third  
years. They also argued for an above-quota surtax of 25 percent, the same rate specified in the  
current provisional measure. USW recommended a continuation of the interim safeguard measures,  
as enacted on October 11, 2018, with some amendments. It argued for a TRQ, based on a three-year  
average of subject imports, applied and renewed on a quarterly basis, with a maximum import level  
apportioned to any single country, based on historical import shares between countries.210  
Importers generally suggested that if a remedy were to be imposed, it should be a TRQ set  
according to a three-year average of the most representative years, for a period not exceeding  
three years, and be progressively liberalized, if not phased out, over that period.211 Importers that  
suggested a specific surtax rate recommended a rate of 10 percent.212  
208. Exhibit GC-2018-001-071.06, Vol. 5 at 33, 34; Exhibit GC-2018-001-071.07, Vol. 5 at 27.  
209. Exhibit GC-2018-001-071.06, Vol. 5 at 33, 34.  
210. Exhibit GC-2018-001-071.07, Vol. 5 at 27, 29, 30.  
211. Exhibit GC-2018-001-071.12, Vol. 5 at 17; Exhibit GC-2018-001-071.14, Vol. 5 at 32; Exhibit  
GC-2018-001-071.15, Vol. 5 at 27.  
212. Exhibit GC-2018-001-071.14, Vol. 5 at 32; Exhibit GC-2018-001-071.15, Vol. 5 at 27.  
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Importers suggested that the current “first-come-first-served” method of quota allocation  
has been disruptive to the marketplace and created significant uncertainty and should be replaced  
with, for example, an allocation system based on historical exporter or country shares.213  
Some parties suggested the remedy should exclude imports from the country of an affiliate  
company, or their own country. For example, SSAB Central and SSAB AB requested a specific  
exclusion for Sweden and Finland or, alternatively, that a TRQ be set for the 3-year average imports  
of SSAB Central from its affiliates located in Sweden, Finland and the United States. The  
Government of Chinese Taipei requested that Chinese Taipei be exempted from the safeguard  
measures.214 The Government of British Columbia requested a regional exemption for imports, into  
that province, of heavy plate from subject countries.215 The Tribunal rejected these suggestions in  
formulating its remedy recommendation.  
Tribunal analysis  
The Tribunal recognizes the need for imports in the domestic heavy plate market and  
believes that a TRQ will provide reasonable access to imports, minimize disruption to the domestic  
industry and give the domestic producers time to adjust their operations while the market stabilizes.  
The Tribunal also agrees that the current first-come first-served method for administering has  
caused considerable disruption and uncertainty in the market.  
Specifically, the Tribunal recommends:  
that an in-quota volume representing the total amount of permitted imports at the  
in-quota rate be fixed, as required by Article XIII:2(a) of GATT 1994. The Tribunal  
recommends that the in-quota volume be set at 100,000 tonnes for the first year.  
that the in-quota volume be increased each year by 10 percent, i.e. to 110,000 tonnes in  
the second year and to 121,000 tonnes in the third year.  
that no surtax be applied to the in-quota imports. This will permit a non-injurious level  
of imports to enter the country without restriction.  
that the above-quota surtax be set at a declining rate, starting at 20 percent the first year,  
15 percent the second year then 10 percent in the third year, to ensure that imports  
above the in-quota volume do not cause the continuation of a threat of serious injury.  
that the Governor in Council consider a different method of allocating the in-quota  
volume than the first-come first-served basis used for the provisional safeguard  
measure.  
213. Transcript of Public Hearing at 59; ibid. at 145-146; Exhibit GC-2018-001-071.14, Vol. 5 at 35, 36;  
Exhibit GC-2018-001-071.15, Vol. 5 at 29-31.  
214. Exhibit GC-2018-001-071.04, Vol. 5 at 23; Exhibit GC-2018-001-071.05, Vol. 5 at 10; Exhibit  
GC-2018-001-071.08, Vol. 5 at 3-6; GC-2018-001-071.09, Vol. 5 at 4, 10; Transcript of Public Hearing  
at 105-107, 111.  
215. Exhibit GC-2018-001-071.03, Vol. 5 at 3.  
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Table 3  
Recommendation on Remedy for Heavy Plate  
(Tonnes)  
In-quota Volume  
Above-quota Surtax  
20 %  
First Year  
100,000  
110,000  
121,000  
Second Year  
Third Year  
15 %  
10 %  
Since the Tribunal determined that imports from Korea are not, on their own, a principal  
cause of threat of serious injury, the Tribunal’s recommended remedy should not apply to imports  
from Korea. There were no imports of heavy plate from Panama, Peru, Colombia and Honduras  
during the POI and therefore imports from none of these sources can be, on its own, a principal  
cause of a threat of serious injury. Accordingly, subject imports from these sources should be  
excluded from the application of any remedy. Imports from GPT countries are either non-existent  
or de minimis.  
Consequently, the Tribunal’s recommended remedy should also not apply to imports from  
Korea, Panama, Peru, Colombia, Honduras and GPT countries.  
The Order excluded imports from the United States, Chile, Mexico, Israel and other CIFTA  
beneficiary countries from the subject goods. Consequently, the Tribunal’s recommended remedy  
should not apply to imports from these countries.  
In arriving at the above recommendation, the Tribunal considered the current state of the  
market. Prices (both domestic and import) began moving upwards in the latter part of 2017 after  
several U.S. AD/CV duty measures came into force216 and in 2018 following the initiation of the  
U.S. section 232 investigation.217 Prices of domestic sales from domestic production rose in the first  
half of 2018 as did the prices of imports of the subject goods, but to a lesser extent. Consequently,  
domestic producers experienced higher price undercutting by subject imports.  
The Tribunal considers that a remedy is needed to prevent a deterioration in the domestic  
industry’s market share, and allow for increased capacity utilization and improved financial  
performance (i.e. increased gross margins and profits). This will in turn allow the domestic industry  
to adjust its position in the face of this sudden and unexpected increased level of competition, by  
assisting the industry to realize its investment plans.218 In sum, the recommended safeguard  
measures should remedy the threat of serious injury caused by increased subject imports.  
The proposed in-quota volume of 100,000 tonnes is based on the average volume of heavy  
plate imported from subject countries219 in the years 2015 to 2018, based on data compiled by the  
216. Transcript of Public Hearing at 53-54.  
217. Ibid. at 27.  
218. Ibid. at 29, 36; Transcript of In Camera Hearing at 13-15.  
219. All countries except the U.S., Mexico, Chile, Israel or another CIFTA beneficiary, GPT countries and  
Korea.  
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