An Act to amend the Customs Tariff and the Canadian International Trade Tribunal Act

Sponsor

Bill Morneau  Liberal

Status

This bill has received Royal Assent and is, or will soon become, law.

Summary

This is from the published bill. The Library of Parliament often publishes better independent summaries.

This enactment provides for the repeal of subsections 55(5) and (6) of the Customs Tariff and their subsequent re-enactment two years later. It also makes consequential amendments to the Canadian International Trade Tribunal Act.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, provided by the Library of Parliament. You can also read the full text of the bill.

Votes

June 10, 2019 Failed 2nd reading of Bill C-101, An Act to amend the Customs Tariff and the Canadian International Trade Tribunal Act (reasoned amendment)
June 10, 2019 Passed Motion for closure

FinanceCommittees of the HouseRoutine Proceedings

June 14th, 2019 / 12:15 p.m.
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Liberal

Wayne Easter Liberal Malpeque, PE

Mr. Speaker, I have the honour to present, in both official languages, the 31st report of the Standing Committee on Finance in relation to Bill C-101, an act to amend the Customs Tariff and the Canadian International Trade Tribunal Act. The committee has studied the bill and has agreed to report it back to the House without amendment.

I expect this will be my last report in the 42nd Parliament as committee chair. Therefore, I want to take this opportunity to thank the several clerks and the many analysts from the Library of Parliament who worked with us during this 42nd Parliament for all their hard work during sometimes inhumane hours, four pre-budget consultations, four budgets, four budget implementation acts and much more.

I also want to offer a sincere thanks to members of all parties and their staff as well as to my staff for their hard work and sincere efforts in working on the finance committee.

Customs TariffGovernment Orders

June 6th, 2019 / 11:50 a.m.
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Louis-Hébert Québec

Liberal

Joël Lightbound LiberalParliamentary Secretary to the Minister of Finance

Mr. Speaker, I am pleased to rise in the House today to speak to the legislative changes made by Bill C-101.

To understand this bill, it is important to understand our government's values. Indeed, it is a good reflection of what we have been doing since our first day in office. Since day one, our government has been firmly on the side of Canadian workers. We have made investments in Canadians and in the economy, investments that have helped create over one million jobs across the country over the past three years. We are helping more workers access skills training so they can get and keep those jobs.

Furthermore, faced with global uncertainty, we have negotiated new trade agreements that will give Canadian workers and businesses access to two-thirds of the global economy. This represents billions of customers around the world. When the United States imposed unfair tariffs on Canadian steel and aluminum, we stood up for our workers. We refused to turn a blind eye or take a hands-off approach, as the Conservative members suggested. At the end of the day, the fact is that our plan worked. We managed to get the tariffs lifted, and we did so because we were thinking about our workers and Canada's interests.

That was a victory for workers and for the country, but we know we are not out of the woods yet. Despite everything we have done to help Canadian workers succeed, global forces beyond our control may continue to threaten that growth, so we must remain very vigilant. We have a duty to ensure that trade practices do not negatively impact the Canadian market by undermining our steel industry and jeopardizing thousands of good middle-class jobs. That is at the core of this bill, which builds on our previous work and strengthens our government's commitment to protecting Canadian workers and their jobs from potential threats like those.

We did not get to this point by accident. We have been listening closely to Canada's industries and workers, and they say that they want more reassurance. They want a government that is willing and able to act quickly when markets are distorted, so we are taking action.

The legislation we are debating today, Bill C-101, would amend the Customs Tariff and the Canadian International Trade Tribunal Act. Specifically, it would remove the two-year moratorium on the imposition of safeguard measures should provisional safeguards be found to be unwarranted.

Safeguards are actions taken by a government to restrict imports of a product temporarily to protect a specific domestic industry. Through this legislation, Canada would be able to respond quicky and appropriately to situations where a surge of imports harmed or could harm Canadian producers and workers.

I want to add that these amendments are intended to be temporary. Our government is proposing that the amendments be in effect only until June 2021. To take this action, further amendments to the Canadian International Trade Tribunal Act are necessary. They are included in this bill.

I want to assure hon. members that the conditions for the application of safeguards would remain unchanged. There are still bars to meet before any safeguard measures are put in place. This legislation would just help us evaluate and act on those standards faster.

I think that all honourable members can agree that these are very interesting and volatile times for international trade. The rules governing international trade and free trade are evolving, sometimes very quickly and often unpredictably. We cannot take anything for granted.

That is why our government has gone to great lengths to try to protect Canadian workers and ensure that Canada's businesses can compete on a level playing field. In fact, when things are unfair and the market distorted, Canadian jobs are at risk.

As the Prime Minister stated, Canada has always been a trading nation. However, we cannot allow this longstanding tradition of openness to threaten or harm Canadian businesses. In the case of the steel industry, we will not let Canada serve as a back door to other markets.

Canada already has the strictest enforcement regime to combat this practice, with 77 trade remedy measures in force for imports of steel and aluminum alone. Last year, we further strengthened the enforcement regime to prevent foreign exporters from avoiding tariffs.

Our enforcement framework includes Canada's trade remedy system, which helps preserve a fair and open trade climate for our producers. It protects Canadian businesses against the effects of foreign goods that are unfairly subsidized or that are sold in Canada at artificially low prices. We currently have trade remedies involving 13 steel products from 25 countries.

In budget 2017, our government went even further to strengthen and modernize our trade remedy system. In April 2018, we increased funding for the Canada Border Services Agency and Global Affairs Canada to keep trade enforcement working for Canadians. This bolstered our efforts to prevent the transshipment and diversion of unfairly priced foreign steel and aluminum into the North American market. The new funding started immediately and amounted to more than $30 million over five years and $6.8 million per year after that. It means more than 40 new officers to investigate trade-related complaints, including those related to steel and aluminum. It means more accurate data on imports so we can better monitor trade trends and better protect our industries and workers against unfair trade.

At the same time, our government made targeted and timely investments to support the Canadian steel and aluminum industry. This includes an investment of $2 billion to defend and protect the interests of the Canadian steel, aluminum and manufacturing industries and their workers. These investments will help companies expand into new markets, increase operational and environmental efficiencies or purchase new technology and equipment.

We know that strong, decisive trade action works, because we have seen it work. As I said earlier, when the United States imposed tariffs on Canadian steel and aluminum, we stood up for our country's steel and aluminum workers, industries and the communities that rely on their businesses. We imposed reciprocal dollar-for-dollar countermeasures to encourage the full removal of the U.S. tariffs. Canada stood firm and did not back down. As members know, on Friday, May 17, we were proud to announce that these tariffs and countermeasures would be eliminated by the following week.

Therefore, there should be no doubt in the minds of any members here today that our government has protected and will continue to protect Canada's steel and aluminum workers, and all Canadians.

Their success is well earned.

Despite global uncertainty, Canadians created more than one million jobs since fall 2015. Last year, all job gains were in full-time positions. The rate of unemployment and poverty is at its lowest in more than 40 years and salaries are rising faster than the cost of living.

Moreover, employment gains are broadly spread out among groups that are often under-represented in the labour market, such as new immigrants, single mothers, indigenous peoples living off reserve and young Canadians who do not have a high school diploma. This is the type of progress that makes a real difference in the lives of Canadians from one end of the country to the other.

Nevertheless, the reversals in global trends are not the only threat to Canadian jobs. New technologies present both obstacles and opportunities to Canadians seeking to build a career. We are making investments and introducing policies to help workers succeed in the economy of the future. By helping more people gain new skills today, we are creating the necessary conditions for long-term prosperity in every sector of the economy, especially for Canadian workers. In fact, that is the spirit of the bill currently before the House.

The nature of work is changing around the world, and Canada is no exception. The Organisation for Economic Co-operation and Development, or OECD, estimates that one in six jobs in Canada is at high risk of automation. This means that a number of workers could be forced to change jobs many times throughout their years in the workforce. Many others will have to learn new skills simply to keep their jobs in an ever-changing work environment.

The good news is that, through the new Canada training benefit in budget 2019, we are providing real support to the workers of today and tomorrow.

The Canada training benefit will provide a flexible option for Canadians to find the time and money needed to pursue training, improve their skills and build strong and lasting careers. It does that in a few ways.

First, budget 2019 proposes a new, non-taxable credit to help Canadians pay for a training course or program. Under this new Canada training credit, eligible workers between the ages of 25 and 64 will accumulate a credit balance of $250 each year, up to a lifetime limit of $5,000.

Second, a new employment insurance training support benefit would provide up to four weeks of income support to workers when they take time off to take a training course. It would replace regular earnings so that workers do not have to worry about taking some time off to upgrade their skills.

Third, in addition to these two aspects, the government is proposing that it consult the provinces and territories about amending the labour laws to ensure that workers can take time off work for training without worrying about losing their jobs. This would protect a worker's right to take leave for training and skills development.

Before I wrap up, I want to remind members that this bill is very much in keeping with what I consider to be the three main pillars of government policy.

When we took office in 2015, the Canadian economy was sluggish, and Canada was in a technical recession. In my opinion, Canadians elected us based on three main economic pillars, on which we have founded our achievements these last three years in office.

These pillars kick-started economic growth in Canada. I would define them in the following manner. First, we made major investments in infrastructure to ensure that people and goods can travel efficiently across the country; reduce greenhouse gas emissions; look after our waste water systems; protect the environment; and build modern and effective infrastructure from coast to coast. It goes without saying that these investments also stimulated growth. We are talking about a very ambitious, $180-billion plan over 12 years.

The second pillar was reducing inequality by giving more to those who need it most and giving the middle class some breathing room. The first thing we did was lower taxes for the middle class and raise taxes on the wealthiest one per cent. Simultaneously, we introduced the Canada child benefit, a social policy unlike any other in recent Canadian history. The CCB reduced poverty in this country by 20% in just three years and reduced child poverty dramatically.

Those are just two of a suite of measures targeting the middle class and the most vulnerable Canadians. Seniors, for example, are getting more because we increased the guaranteed income supplement by 10% when we took office. The goal is to reduce inequality. We on this side of the House believe that the more inclusive our prosperity, the stronger our growth and the better off Canada's economy will be. We know we are right about that because in 2017, Canada's growth was the strongest in the G7 and we are still at the head of the pack.

The second pillar was about reducing inequality through measures like taxation and the Canada child benefit. There is also social housing, which the federal government has been withdrawing from for years. Now this government is getting back into it. I could also mention how we helped seniors by rolling back the retirement age from 67 to 65. The Conservatives had raised it, plunging hundreds of thousands of seniors into poverty. Then there is the Canada child benefit, which is putting a lot more money back in families' pockets.

According to available data, which, incidentally, are from the OECD, not from partisan think tanks, the average Canadian family has $2,000 more in its pockets in 2019 than it did in 2015.

Furthermore, according to Statistics Canada, a renowned and completely impartial institution that everyone can be proud of, we have succeeded in reducing poverty in Canada by 20%. We achieved that in just three short years. We are not planning to stop there. As I said, one of the key pillars of our government's efforts and our economic strategy is to reduce inequality.

The last pillar is about maintaining Canada's competitive edge by investing in science, research and innovation. Budget 2018 contained some of the largest investments in science in Canada's history. We are also opening up access to international markets, as we did with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the Comprehensive and Economic Trade Agreement, or CETA, and with the renegotiated NAFTA. Thanks to these kinds of measures, we are making sure we are here to protect our industries from the threats of today's interconnected economy.

I believe that Bill C-101 is entirely consistent with the government's ambition and action. It will promote growth and prosperity, while protecting our industries and workers to ensure that Canada succeeds.

To conclude, I want to reiterate our government's commitment to Canadian workers and to our industry. We will continue to carefully monitor the situation, with great vigilance, for distortions in global markets. Make no mistake, if it is determined that a surge of imports is harming or could harm our workers and producers, we want to be able to respond.

It is the right thing to do for our workers, and the right thing to do for our economy. That is why I urge all members to support this legislation so that it can pass without delay.

On that note, I would like to thank the NDP, the Bloc Québécois and the independent members who voted in favour of this ways and means motion. The Conservatives, on the other hand, will have to explain their position on this.

Customs TariffGovernment Orders

June 6th, 2019 / 12:15 p.m.
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Liberal

Joël Lightbound Liberal Louis-Hébert, QC

Mr. Speaker, I thank my colleague for his question.

Bill C-101 provides the government with another tool and greater flexibility to respond to a market distortion or an increase in the amount of steel entering the North American market. However, the bill does not impose any safeguards, per se. It is important to remind our opposition colleagues of this.

Everyone knows how trade relationships work today. Things can change very quickly and we need to respond quickly. It is important that the government have greater flexibility to be able to act, as needed. This is a measure that is generally supported by the House.

As for my colleague's specific question, I would like to remind him of the investments made in budget 2018 and budget 2017 to give Global Affairs Canada and the Canada Border Services Agency sufficient resources to obtain more information and better understand the market and how it is changing in real time, with a view to making decisions that take into account Canada's different regional realities. My goodness, there are so many, and they all operate differently and have a different reality. It is important we have this information and to obtain it, we need to make these investments. That is what the government has done in the past to be able to support each region of the country in the most appropriate way.

Customs TariffGovernment Orders

June 6th, 2019 / 12:15 p.m.
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Conservative

Erin O'Toole Conservative Durham, ON

Mr. Speaker, I need to start my remarks by recognizing that today is the 75th anniversary of D-Day. I have the ability to stand in this House, in our parliamentary democracy, because of the sacrifice of the 359 Canadians who died on D-Day, the 14,000 who landed on Juno Beach, and the 25,000 involved in the operation with our allies. I would be remiss if I did not start my remarks with this, because we are fortunate to have democracy based on that.

The parliamentary secretary said that this bill is a reflection of the Liberal government's values when it comes to trade. He is either reading a speech that was provided for him, or he does not realize it is actually a very high-profile abandonment of the values that Liberals projected on trade for several years. The parliamentary secretary has heard the foreign minister talk countless times about the international rules-based order. With the trading order and security order, the international rules-based order has probably been one of the foreign minister's most common refrains. In fact, in her famous speech in Washington, in June 2018, she said:

One answer is to give up on the rules-based international order, to give up on the Western alliance and to seek to survive in a Metternichian world defined not by common values, mutually agreed-upon rules and shared prosperity, but rather by a ruthless struggle between great powers governed solely by the narrow, short-term and mercantilist pursuit of self-interest.

“The ruthless, short-term, mercantilist pursuit of self-interest” should be the preamble to Bill C-101. It is an abandonment of WTO rules with respect to international trade, the rules on which the minister would like to lecture not only us but also the Americans in Washington.

It is not just my opinion that it is a WTO violation. As noted trade lawyer Mark Warner tweeted about Bill C-101, the Canadian government has been proclaiming its adherence to the rule of law at every turn, and now is suspending parts of the WTO safeguards agreement for two years.

This is an example of an abandonment of a rules-based approach to trade, and our trading partners and friends around the world notice that.

Now, there is a real politic to trade that the government avoided and ignored for its first several years. That is why Canadians should be shocked that in the final weeks of this Parliament and with no collaboration from the opposition, Liberals have tabled a ways and means motion on the new NAFTA, on safeguard provisions. In fact, they are changing the law, not to allow safeguards not to have their two-year suspension after being applied, but to have the ability to have permanent safeguards. The Liberals are doing this in the final days of the House and will likely use time allocation to rush it through.

The Conservatives are going to use this time to try to suggest some ways to mitigate the impacts of Bill C-101 with regard to issues that the government should have thought of and should have brought for debate. We are going to stand up for the interests of the wider group of employers and employees in the fabrication of steel products, particularly the western steel and construction industries, and recommend ways to help them through the disruption this bill will cause.

Hopefully, the government will address some of our concerns and make this better. Hopefully, it will deal with the companies and employees in western Canada, in Quebec and in Newfoundland and Labrador who will be impacted. In my remarks, I am going to use some time to recommend that. We want to, and may, support this bill, but it is up to the government, rushing it through in the last few days, to address the real issues that will affect small and medium-sized businesses, and to allocate some of the $2 billion it has already collected in retaliatory tariffs. The government promised this would help small and medium-sized enterprises, but it has not.

We want to hear a plan. The government has lurched from crisis to crisis on trade, tariffs, NAFTA, canola with China and pork with China. Enough with the crises. We want a plan. As an effective opposition, that is what we will do.

I have already said that this violates WTO safeguard regulation, but it also violates the ruling of the Canadian International Trade Tribunal from April, our own rules-based order. I would refer to the Minister of Finance and the Minister of Foreign Affairs. The trade tribunal did say that there was “serious injury” with respect to the dumping or import of heavy plate and stainless steel wire. However, it clearly said that on rebar, energy tubular products, hot-rolled sheet, pre-painted steel and wire rod, there was no serious injury and therefore no need for safeguards.

These may seem like obscure terms to Canadians, but our recommendations today will actually show how we can go with the spirit of the safeguards and also safeguard the jobs and economic activity that depend on these steel products.

I will bring it home for Canadians. Energy tubular products are used in our oil sands, the energy industry in western Canada. There is steel plate that, if we do not have specific imports, will raise the cost of the Champlain Bridge in Quebec by $1 billion, putting at risk critical public infrastructure. There is also the Muskrat Falls project in Newfoundland and Labrador. I would like to shake out of their slumber the Maritimes and Atlantic members of the Liberal caucus. Do they realize that this project, which is already in huge cost overruns, will potentially be made worse unless there are geographic or steel-specific exemptions? The LNG Canada project, which I believe the Prime Minister took some photos at the launch of, is at risk unless some exemptions or specific regional quota is provided. There is also the Site C dam in British Columbia.

Therefore, critical jobs, economic development and public infrastructure, like the Champlain Bridge, are all potentially at risk economically because of steel that needs to be imported.

We do not make enough of these types of products, such as rebar. We already know of the affordability crisis in Vancouver, the Lower Mainland and Toronto. The construction industry needs rebar for commercial and residential building, and 40% of it in western Canada has been imported from Asia, Taiwan mainly. It will be cut off, and the producers, construction companies and fabricators that use a lot of these types of steel will see their prices go up by more than one quarter. There are real impacts here.

The government cannot rush in all of these bills at the end of Parliament because it messed up its trade strategy for four years. Therefore, we are going to have some recommendations that we want the government to take seriously, because there are thousands of jobs. Let us have a win for the steel producers, fabricators and construction companies by being smart with safeguards and having regional provisions, regional protections and quota allocations.

Let us review the history. The Liberal government came in knowing that the U.S. had issues with the Chinese oversupply and transshipment of steel. In fact, the Obama administration, in 2016, applied tariffs when it introduced the Trade Facilitation and Trade Enforcement Act and brought up steel duties by 500% on some steel products. We know that the Prime Minister got together with President Obama for another photo-op the other day. We know that bromance. Why did they not start coordinating concerns about transshipment then? In fact, they did not. Some of the members are waking up now, and I am happy to see that.

In 2017, the U.S. president expressed a direct concern about oversupply and transshipment, and said he would use section 232 tariffs on steel and aluminum. What was our response? Absolutely nothing. We know that because of the admission of failure from the finance minister that came on May 30, 2018, when he quietly introduced country-of-origin labelling rules for Chinese steel tracing, which is part of transshipment investigation, hours before section 232 tariffs were applied on Canada. I would remind the member for Malpeque of that.

The U.S. had been asking for this. In fact, the Commerce Secretary has acknowledged that Canada did not work with the U.S. on transshipment concerns; therefore, section 232 tariffs were applied.

Despite the fact that, in 2018, the Prime Minister went to Sault Ste. Marie and a number of other communities and said he had their back because he had a one-month exemption, the Conservatives who were going down to Washington knew that Canada had not made the moves. It had not put in tracing measures, country-of-origin labelling, to take American concerns on transshipments seriously. Therefore, the tariffs were applied. We could have avoided that.

I laugh at the friends who used to call the current Prime Minister the “Trump whisperer”. We have been in a one-sided, bad-outcome relationship with the United States under the Prime Minister, going back to Obama, because transshipment concerns could have taken place back in the Obama administration. I will remind the members that, in June of last year, over a year ago, I asked the minister about this at the trade committee. I referred to the section 232 tariffs and the need for country-of-origin marking and transshipment concerns. The minister dodged my questions for six minutes.

Customs TariffGovernment Orders

June 6th, 2019 / 12:30 p.m.
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Conservative

Erin O'Toole Conservative Durham, ON

Mr. Speaker, there is a transcript from a year ago, when I questioned the minister on Liberal delays on safeguards. I will send this package to the member from Toronto and to the rest of the Liberal caucus, because they have been asleep. How do I know that? None of them showed up to their own government's briefing on this bill last night. In fact, I found out about it when the Minister of Finance asked me and said there was a briefing. The Liberals did not invite the opposition to the briefing. That is how they have played this from day one.

The minister avoided all my questions on why Canada waited over a year to take U.S. concerns over transshipments seriously. We could have avoided section 232 tariffs. We could have been having this debate on safeguards a year and a half ago, when the Conservatives asked for it, at a time when we could have mitigated some of the impacts of safeguards.

I am going to go through those impacts now, because they are real. They affect jobs in Winnipeg, Sault Ste. Marie, Hamilton, Toronto, Prince Edward Island and wherever that guy is from. They are real because there are fabricators in all communities.

I toured a great fabrication plant, one of the largest employers on Prince Edward Island. It works with Quebec steel companies to bid on and build stairways and parts of construction in Manhattan high-rises. I know the member for Malpeque is proud of those jobs, as am I. These are all affected by poor Liberal decisions on trade policy and will be impacted by Bill C-101.

What the Conservatives want to see is mitigating the impact. We want to see western Canadian fabricators and critical public infrastructure projects like Muskrat Falls, Site C, LNG Canada and the Champlain Bridge protected by regional allocation of quota. We want to make sure that the Champlain Bridge does not cost $1 billion or $2 billion more as a result of this bill. That can be done, and it can be WTO-compliant through TRQs, regional allocation of quota for critical industry, because western Canada cannot get steel from Hamilton to Sault Ste-Marie. It is uneconomical to ship it there. We do not make enough rebar and other critical elements of plate that we need. They need to import, so let us give tariff allocation where it is needed, for example in Newfoundland and Quebec. We are going to recommend that.

We also have recommendations about the $2 billion the Liberals have collected through tariff-like taxes, through retaliatory tariffs. They said it would go as relief to small and medium-sized businesses impacted by trade disruptions, by section 232. They have not given the money. They have given some loan guarantees to the large steel players. We want to see a commitment to allocate some of those funds to the small and medium players and to address geographic concerns. If so, they will see the Conservatives work with them on Bill C-101, work with them on NAFTA, even though we are not happy with the fact that we are seeing these in the final weeks of Parliament, when the Conservatives have been asking for this for over a year.

Let us review. President Trump was not even inaugurated when the Prime Minister volunteered to renegotiate NAFTA. That was a risk we did not need to take, but when it was taken, the Conservatives put forward suggestions to the government. Let us remember that 98% of Canada's trade access was negotiated by Conservative governments, including NAFTA, including U.S. free trade. We said, let us put auto forward. Let us put softwood and key agricultural sectors forward as our priorities, because the U.S. trade representative Ambassador Lighthizer and his team had already prepared a list of priorities where the U.S. wanted to go.

The minister's speech at the University of Ottawa addressed none of the issues the U.S. wanted to talk about. The Liberals launched their much-vaunted progressive agenda and they talked about issues related to the Prime Minister's brand, but that had no relation to trade whatsoever. In fact, they did not mention auto and auto part calculation for six months. When they did, we praised them for that and there was progress finally made in the NAFTA discussions.

Mexico took the talks seriously and had 80-plus meetings with White House officials. It had a deal done before Canada did. That should trouble Canadians. The government virtue-signalled, as I call it, and put its own electoral ambitions ahead of the national interest. That should trouble Canadians.

That is why, in the final days of Parliament, we have the two most substantive economic pieces of this Parliament being rushed through in ways and means motions. It is because of incompetence. The section 232 tariffs were completely avoidable if, going back to President Obama, we had taken concerns about Chinese transshipments seriously. They were avoidable if we had taken NAFTA seriously and had put forward the auto sector, which was always going to be critical, and if we had put in softwood lumber and tried to deal with that constant generational issue that is now hurting our western producers, and if we had put in agriculture and started punching back at the administration's claims about subsidies through our supply management system. The U.S. spends more on agricultural subsidies than we do on our military. I did not hear the government pushing back on that.

The Liberals were talking about the progressive agenda with a president who they know was not quite progressive. They totally misaligned our interests. That is why Mexico, which had a weaker position going in, got a deal before Canada did. We had to scramble to try to be an add-on to that deal.

The same thing happened with tariffs. Mexico was ahead. That is why I am happy that the Conservatives collaborated. We told the ambassador that we were going down. The member for Prince Albert and I, in one day, were invited to a caucus meeting and met more members of Congress than the government did in the previous year to talk about section 232 relief.

I have talked about some of the ways we can work with the government on Bill C-101. To fix the issues that are missed, to mitigate, we are proposing an amendment to make this bill better.

I move, seconded by the member for Oshawa:

That the motion be amended by deleting all the words after the word “That” and substituting the following:

the House decline to give second reading to Bill C-101, An Act to amend the Customs Tariff and the Canadian International Trade Tribunal Act, because it fails to:

a. take into consideration regional disparities in industry needs, specifically, that domestic producers only minimally supply certain steel products to British Columbia, Quebec, and Newfoundland and Labrador;

b. add a geographic exclusion, either exempting British Columbia, Quebec, and Newfoundland and Labrador from the proposed safeguards or allocating a dedicated share of the regional quota to British Columbia, Quebec, and Newfoundland and Labrador;

c. stipulate specific tariff and trade disruption relief to steel fabricators;

d. mandate that the funds collected through retaliatory tariffs on the United States go to support small and medium-sized Canadian steel and aluminum fabricators and retailers impacted by the application of the retaliatory tariffs; and

e. grant specific product exclusions for certain steel products that are not produced in commercial quantities in Canada to avoid the negative economic impact of safeguards on critical public infrastructure projects like the Champlain Bridge, the Muskrat Falls Hydroelectric Dam, the Site C Dam, and projects of national economic importance like LNG Canada.

Customs TariffGovernment Orders

June 6th, 2019 / 12:50 p.m.
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NDP

Scott Duvall NDP Hamilton Mountain, ON

Mr. Speaker, I am pleased to have the opportunity to speak today to Bill C-101, an act to amend the Customs Tariff and the Canadian International Trade Tribunal Act.

The bill looks to repeal subsections 55(5) and 55(6), thereby eliminating the two-year waiting period on the imposition of provisional safeguards. I am somewhat pleased to see the government finally taking this good first step to protecting Canadian steel producers and the hard-working people employed in the industry.

The NDP will support the bill as it will temporarily help the steel industry, but the government should never have let the deadline go by without imposing permanent safeguard measures, which the NDP has been calling on for years. When the finance minister allowed the safeguard deadline to pass in April, he placed workers and business at great risk. Now he is temporarily changing the timeline through legislation.

However, let me be very clear. The NDP is adamant that we see this measure as only a small step and it absolutely must be followed by the imposition of, at the very least, provisional safeguards over the five remaining unprotected product categories of the seven listed by the Canadian International Trade Tribunal, also known as the CITT.

These measures must also protect and stabilize the Canadian steel industry over the long term. Having worked in the steel industry for 35 years and representing a community in which the steel industry plays a large part in the economy, I have a very personal interest in this issue along with other workers.

For the past three and a half years, we have tried to deal with this and many other issues facing the steel industry through the ineffective and Liberal-dominated all-parliamentary steel caucus. The commitment of the government to the work of that committee has been disappointing and half-hearted at best.

The measures in the bill also seem half hearted. While these provisional safeguards are satisfactory, we in the NDP have been calling on the government and the Minister of Finance to put permanent safeguard measures in place for well over a year. This would, of course, provide more stability to this already shaken and targeted industry.

Like so many things the government does, this bill, it reaction to the tariffs imposed by the Americans on the Canadian steel and aluminum industry and the issue of the dumping of foreign steel into the Canadian market, has half measures at best.

Speaking of half measures, by taking away the two-year waiting period, the bill would only allow the government to put into place temporary and somewhat superficial protections for unprotected steel product categories listed by the CITT. We will be watching and fighting to ensure the government follows the legislation up with real action. Our steel industry and workers deserve real solutions to the predatory pricing efforts of steel importers worldwide.

For years, the NDP has urged the government to address the very real problem of cheap steel imports directly and/or indirectly entering the North American market, including the provision of increased resources to the CBSA to allow them to investigate and respond to the increased dumping of steel products. In our view, Canada cannot be a dumping ground for foreign steel or be a back door to the American market.

It must also be recognized that, while the U.S. has dropped section 232 tariffs on Canadian steel, tariffs remain on other steel producing countries. That leaves Canada vulnerable to surges of foreign steel heading through Canada to the U.S. market. This is a dangerous position that must not be tolerated.

However, please allow me to take a step back and provide some context for why this is such an important issue.

Canadian steel producers generate over $14 billion in annual sales, while supporting over 22,000 direct jobs and over 100,000 indirect jobs. All of this is done through 19 facilities across five different provinces. The production of steel acts as an anchor for a much larger supply chain of secondary manufacturing companies in fabrication, construction, automotive and many other sectors throughout the Canadian economy.

I know that in the greater Hamilton area, the steel industry provides over 10,000 direct jobs and supports an estimated 30,000 secondary jobs.

In Sault Ste. Marie, the steel industry is anchored by Algoma Steel and Tenaris Algoma Tubes. These two companies alone directly account for over 41% of the community's gross domestic product. About 30% of their workforce are directly and secondarily employed in the steel sector. That is over 9,000 jobs.

In the Windsor-Essex region, Atlas Tube, which is located in Harrow, Ontario, employs 220 workers and exports over $250 million of product each year. It is interesting to point out that Atlas Tube is the most efficient producer of structural steel in the world.

EVRAZ is another steel company and it employs over 1,800 people in western Canada, including in the pipe mill in Regina.

It is also interesting to note that the Canadian steel industry is a world leader in labour and environment standards, something of which we should all be proud.

Dumping is a form of predatory pricing when a country exports its product below the market price, driving out competition and creating a global monopoly. Many of these foreign companies are able to offer lower prices precisely because of their lack of environmental or labour regulations.

We have been after the government for years to provide protection against the dumping of foreign steel. The Canadian Steel Producers Association has repeatedly asked the government to be proactive in finding solutions to the dumping steel issue, which has hurt the steel industry across the board. The government only took action, and temporary action at that, in reaction to the tariffs imposed by Donald Trump on the Canadian steel and aluminum industries.

We were given a heads-up almost the first year of this session. The government kept saying it knew what it was doing. However, it all comes down this. What the government did unilaterally became a real mess. It kept having to fix its mistakes, as more and more were made. Now we are debating the bill today.

That is clearly not good enough. The Liberals should have put permanent safeguards in place as soon as they came into power. They knew then that the illegal dumping of dirty steel into Canada was a major concern for our steel industry.

In April, the government decided to allow the safeguards in place to expire on imports of five types of steel products. Because of current legislation, those safeguards cannot be restored for two years, regardless of potential threats to Canada's steel sector. The legislation we are considering today would allow the government to waive the two-year waiting period and impose the safeguards again. That is a good thing, but it is not nearly enough.

It is always interesting to gauge the response to government legislation through those who will be affected.

Ken Neumann, national director of the United Steelworkers, had this to say:

We hope the legislation announced today will be passed swiftly in Parliament, before the summer recess. In the meantime, Canadian workers and producers need an unequivocal commitment from the federal government that it will implement safeguards or other strong measures to defend our industry....The government must signal that it is prepared to retroactively apply safeguards or other measures to protect Canada's steel sector from potential surges in imports....These safeguards or other measures must be reintroduced to stabilize Canada's steel sector and defend Canadian workers and producers from surges in foreign imports.

With respect to surges, one thing was very concerning for many producers across Canada. Although they wanted the tariffs lifted, they did not want them traded off for a quota system that would stop the growth of the steel industry in Canada. The government said that it listened to this and said it did not have quotas. However, it has what are called “surges”, to offset concerns. The government believed that since it did not use the word quota, it could fool producers by saying it had surges. However, I think surges is just another name for quotas. We are not sure what surges actually means.

Recently, the United Steelworkers asked the government to use sections 53 and 55 of the Customs Tariff, which gives the federal cabinet the authority to respond to tariffs as well as act against countries participating in dumping. For example, the government can apply a surtax to any goods that are being imported under such conditions as to cause or threaten serious injury to domestic producers. The Liberal government declined.

Interestingly, the United Steelworkers also recently sent a letter to the government, detailing its concerns about the new North American free trade deal. In that letter, it addresses concerns about the steel industry. It says,“The USMCA should never have been signed absent the removal of steel and aluminum tariffs. While we are happy that the tariffs have finally been removed, we are concerned with some of the details in the agreement to remove the tariffs: The ability of the U.S. to legally apply new tariffs if there is a surge of imports about the historical average.” Is that quotas or is that all of a sudden a bigger supply? “The lack of measures to protect and stabilize the Canadian steel market leaves us vulnerable to import surges. This threatens not only the domestic Canadian industry, but also leaves us vulnerable to the reimposition of tariffs; Our ability to respond to tariffs if they are imposed. Canada will be limited in its response and only able to impose counter tariffs on the same products; this limits our ability to impose counter tariffs that are proportional but based on products that are actually produced in the U.S.” It says, “We believe that the USMCA should not be ratified until the details of the tariff agreement are finalized. We must ensure that we do not agree to provisions that allow for the re-impositions of tariffs or that are, in effect, a quota.”

Catherine Cobden, president of the Canadian Steel Producers Association, also commented on the legislation, saying:

Today’s announcement by [the finance minister] represents an important step to ensuring Canada can respond swiftly to changes in global steel markets caused by overcapacity and trade actions taken by other jurisdictions. Safeguard measures are an important trade tool for preventing diversion of foreign imports into Canada’s domestic steel market. The Canadian steel producers believe these trade measures continue to be necessary in today’s global context.

Roger Paiva, general manager of Gerdau steel in Whitby, had this to say,"We seek your support to extend the Government of Canada's provisional steel safeguards. The safeguards have stabilized the Canadian rebar market. They are securing middle-class jobs in your riding and beyond. They are growing the economy while protecting the environment. Please show your support for good steel jobs, and please encourage [the finance minister] to extend the safeguards."

Finally, Francis Miner from lvaco near Hawksbury, says

The European Union and a number of other jurisdictions have recently implemented safeguards on steel products following restrictions to the US market caused by the section 232 tariffs. Without safeguards Canada will stand alone, and the domestic steel industry will be heavily exposed to large volumes of low-priced imports being diverted into the country. This places Canadian producers at a significant competitive disadvantage and thousands of jobs at risk....Without the extension of a safeguard measure on wire rod, market conditions for producers in Canada will deteriorate further.

I totally agree with him on the wire rod. That was my business for 35 years. We took wire rods and made wire anywhere from as thin as a hair to an inch and a half. It would used for ball joints or car parts, such as steering wheel rods. They made it into fencing. They made it into all kinds of different thing. We were a big market, but with the tariffs and the safeguards, there was nothing. It really hurt our competitive edge in Hamilton.

It is clear that Canada's steel sector still faces daunting challenges. Canada cannot continue as one of the few countries in the world that allows foreign steel to flood into its markets. The federal government must protect our producers and our workers.

I have spoken with many workers from the steel industry, from across the country and many in my own community. They are all feeling some sense of insecurity. While they are all happy the tariffs on Canadian steel and aluminum were finally dropped, many of them do not trust the government on this issue.

When the Prime Minister visited Stelco to make the announcement the tariffs were being dropped, one of the workers asked him what he had to give up to get the tariffs lifted. He did not answer the question. As we have heard in recent reports, this could have been more than what the government first let on.

I am told that the mood among the workers at Stelco is that while they are happy the tariffs have been lifted, they still have a healthy dose of skepticism. Like many workers across the country, they are concerned the government is not tough enough to stand up for them and the steel industry against the U.S. and other countries.

As the president of USW Local 8782 in Nanticoke pointed out recently, one would think the government in Ottawa would have the interest and common sense to protect Canadian interests and the industry, but that is apparently not the case.

In closing, I would like to say that I listened to the comments from the member for Durham and I agree with the suggestion that we should all work together on this. All parties should work together. We have found that the government cannot do this unilaterally. It has made too many mistakes. We have to make sure we get this right, to protect not only the Canadian industry but our Canadian workers. We can only do that by working together. Therefore, I encourage all members to join the same team and work as hard as we can.

Customs TariffGovernment Orders

June 6th, 2019 / 1:40 p.m.
See context

Conservative

Ed Fast Conservative Abbotsford, BC

Mr. Speaker, it is my pleasure to engage in this debate.

This debate is really a story of failed Liberal foreign policy. It is a story of failed Liberal trade policy. It is also a story about the abandonment of Canada's western manufacturers who depend on competitively priced steel and aluminum products.

As with most Liberal ventures, there is always a backstory, a very ugly backstory. In an earlier question, I signalled what that story might be. It is a story of a government that thought it could bluff the Americans. It thought it could get away with not addressing the issue of steel and aluminum dumping, and the U.S. called its bluff. A year ago, the U.S. imposed steel and aluminum tariffs on Canada, its most trusted trading ally.

When has that ever happened? Never. This is a Liberal government that cannot even get its relationship with the United States right. I can speak from experience. I am the former trade minister of Canada. Under our Conservative government, we were able to negotiate free trade agreements with 46 different countries around the world, the most successful trade policy ever implemented in this country. We left the Liberal government with a trade environment that was as good as it gets. There was not a relationship around the world that we had where we could not go to our counterpart, whether it was the U.S. trade representative or the trade minister for China or Chile or Peru, and resolve important issues, trade irritants between our countries.

Now we have found ourselves in this situation for a whole year. Canada has faced punitive tariffs from the United States, because of the incompetence of the Liberal government. Let me explain.

The present Liberal government thought it could bluff Donald Trump by saying, “I know you are concerned about the dumping of aluminum and steel products into Canada, for example from China, one of the worst offenders when it comes to dumping. I know you are worried about it, Mr. President, but we are going to do nothing about it.” Donald Trump said, “I am not someone who does nothing. I am going to do something about it. I am going to impose tariffs on you, Canada, one of our most trusted allies. I am going to do it under section 232, the national security provisions.”

What an embarrassment that should be for the Liberal government, that this would happen under the Liberal watch. However, that is what happened. For a year, we had American tariffs on any exports that involved aluminum or steel. We can imagine how difficult that has been for our industries.

I am going to speak a little about Abbotsford, my home community, where we have a number of very significant manufacturers that use steel and aluminum to create products for Canadians and for export to the United States and elsewhere around the world. These companies, small to medium-sized businesses, had been expanding.

In fact, one company, Mayne Coatings, a favourite of mine, had chosen Abbotsford as the best place to invest, assuming that under a Liberal government the trade policy of this country would continue on, that it would be a healthy one, and that our relationship with the United States would continue to be healthy. They made those assumptions, quite falsely, of course. They assumed that would carry on, and they invested heavily in Abbotsford. In fact, they built a manufacturing facility worth $100 million in a small community of 150,000 people. They trusted the Liberal government, and what a mistake that was. No sooner had construction started on this building that Canada was slapped with aluminum and steel tariffs that have seriously undermined the business model for this company.

I feel very sorry for Mayne Coatings and other industries and companies in Abbotsford that trusted the Liberal government. What a misplaced trust that was.

Today we are seeing the tail end of that process. For a year, we suffered under those punitive tariffs, and now finally the Liberal government has woken up to the fact that the Americans expect Canada to address the illegal dumping of steel and aluminum in Canada and to address surges.

The government is finally introducing Bill C-101, which addresses this issue, except it has a number of failings. We have introduced an amendment that highlights the fact that this legislation fails to take into consideration regional disparity. In other words, what happens in British Columbia, where I am from, is quite different from what happens in Ontario and Quebec, where steel and aluminum are produced.

Shipping that aluminum and steel to the west coast does not make any financial sense, so those who manufacture products in my region of the country need to have different rules, which take into account the fact that they have to bring in their steel and aluminum from elsewhere because it is not competitive to do so from central and eastern Canada.

Second, this legislation fails to add a geographic exemption for industries like Mayne Coatings from Abbotsford that are far beyond the reach of our own homegrown Canadian steel and aluminum producers.

Third, this legislation fails to stipulate specific tariff and trade disruption relief for steel fabricators.

The fourth one is the most important one, in my mind, because it is a breach of trust, a breaking of failed promises by the Prime Minister. A promise was made by the Liberal government that it was going to impose retaliatory tariffs on the Americans, which is great. They do it to us; we do it to them. We collect tariffs coming in. What did the Prime Minister promise? He promised that those tariffs would be used to offset the impact of American tariffs on our Canadian manufacturers.

How much did the Liberal government collect? It collected $2 billion in tariffs. How much of that money has actually gone to the manufacturers across Canada that were impacted by the tariffs the Americans imposed upon us because we would not act on their concerns? How much of that money went to our manufacturers across Canada? Virtually zero. This is another broken promise on the part of the current Prime Minister.

Members may remember that he made a ton of promises. He knew very well from the start, even before the last election, that many of those promises he could not keep. He made them anyway, because he just wanted to get elected. That is disgraceful. We see it playing out now here in Canada with our manufacturers who are suffering the consequences of it.

Two billion dollars were supposed to be dispersed to support our small and medium-sized businesses across Canada, and larger ones, that were all being impacted by this failure of the Liberal government to take care of our bilateral relationship with the United States. The Liberals could not even deliver on that.

I do not hold any ill will toward my Liberal colleagues across the way. They are not disputing the fact that $2 billion was collected by the Prime Minister, with the understanding that the money would be dispersed among Canadian companies to make sure they did not suffer as a result of the Donald Trump steel and aluminum tariffs. Guess what. It was a broken promise. Every single one of those MPs on the Liberal side is going to be held accountable for that in October. A reckoning is coming on October 21, and that reckoning is going to hold the Liberals to account for their false promises, such as their promises on balanced budgets, their promises on small deficits—