Vol. 134, No. 51 — December 16, 2000

Order Repealing the Motor Vehicles Tariff Order, 1998

Statutory Authority

Customs Tariff

Sponsoring Department

Department of Finance

REGULATORY IMPACT ANALYSIS STATEMENT

Description

The purpose of these Orders is to complete the implementation of the rulings of the World Trade Organization (WTO) regarding the measures used by Canada to implement the Canada-United States Automotive Trade Agreement of 1965 (the Auto Pact).

In February 2000, a Panel established by the WTO upheld complaints filed against Canada by Japan and the European Communities (EC) claiming that certain elements of the measures implementing the Auto Pact are inconsistent with Canada's obligations under the 1994 General Agreement on Tariffs and Trade (the GATT), the Agreement on Subsidies and Countervailing Measures (the SCM Agreement) and the General Agreement on Trade in Services (the GATS).

The Auto Pact is implemented in Canada through the Motor Vehicles Tariff Order, 1998 (MVTO, 1998) and a number of Special Remission Orders (SROs). Under these measures, qualified vehicle manufacturers are able to import new vehicles (cars, trucks and buses) duty-free from any Most-Favoured-Nation (MFN) country, provided certain performance requirements based on production-to-sales ratios (i.e. the ratio of the net sales value of the vehicles produced to the net sales value of all vehicles sold for consumption in Canada) and Canadian value-added (i.e. Canadian labour costs, administrative and general expenses incurred in Canada, the cost of parts produced in Canada) are met.

The complaints filed by Japan and the EC focused on the right of qualifying Auto Pact manufacturers to import vehicles duty-free from offshore while non-qualifying vehicle manufacturers in Canada are required to pay the 6.1 percent MFN tariff on the vehicles that they import from offshore.

In March 2000, Canada appealed certain of the Panel's findings to the WTO Appellate Body. Japan and the EC also filed cross-appeals. In May 2000, the Appellate Body overturned one of the panel's findings under the GATS, but upheld the Panel's findings that key elements of the Auto Pact measures, namely the duty waiver and the ratio requirements, are in violation of Canada's WTO obligations under the GATT and the SCM Agreement.

On June 19, 2000, the Appellate Body Report and the Panel Report, as amended, were adopted by the WTO Dispute Settlement Body (DSB). The DSB also recommended at that time that Canada withdraw the measures found to be inconsistent with the SCM Agreement (namely the production-to-sales ratio requirements) within 90 days, as recommended by the Panel (i.e. by September 17, 2000). On July 19, 2000, pursuant to WTO requirements, Canada informed the DSB that it would honour its international obligations and would comply with the recommendations and rulings of the DSB in two stages.

As a first step, the MVTO, 1998 and SROs were amended to remove the references to the production-to-sales ratio requirement which was found to constitute a prohibited export subsidy, effective September 17, 2000. The second stage involves the implementation of the non-subsidy findings and will require the revocation of the MVTO, 1998 and the SROs in their entirety. For these findings, the WTO rules provide that, where it is impracticable to comply immediately, members shall have a reasonable period of time in which to comply.

The parties to the dispute were unable to agree on a reasonable period of time. As a result, the reasonable period of time was determined by binding arbitration at the WTO and, on October 4, 2000, Canada was awarded eight months from the date the Panel and Appellate Body Reports were adopted by the DSB (i.e. by February 19, 2001) to comply with the remaining Auto Pact findings.

Alternatives

The introduction of orders in council pursuant to subsection 14(2) and section 16 of the Customs Tariff and subsection 23(2) of the Financial Administration Act to repeal, respectively, the MVTO, 1998 and the SROs is the only alternative in this case.

Benefits and Costs

Following the repeal of the MVTO, 1998 and the SROs, the vehicle manufacturers formerly eligible for the Auto Pact benefits will be required to pay the 6.1 percent MFN tariff on all non-NAFTA originating vehicles that they import into Canada. In this regard, it is estimated that the vehicle tariff will apply to an additional 40 000 vehicles sold annually in Canada (largely luxury vehicles).

Industry experts generally agree that, while the Auto Pact has served well in helping to strengthen Canada's automotive sector, it is no longer needed and its loss will have no substantive impact on qualifying manufacturers. The Canadian industry is strong and globally competitive for reasons independent of the Auto Pact. Production and employment are at record highs. In addition, the Auto Pact has essentially been replaced by NAFTA. In 1999, 1.3 million of the 1.5 million vehicles (i.e. 85 percent) sold in Canada were produced in North America. The tariff on NAFTA-originating vehicles from the United States has been eliminated and NAFTA-originating vehicles from Mexico are currently subject to a 1.8 percent tariff (or less) and will be duty-free in 2003.

Consultation

Officials of Finance Canada, Industry Canada, the Department of Foreign Affairs and International Trade, and the Canada Customs and Revenue Agency have consulted with stakeholders throughout the WTO dispute process. Canada's implementation of the DSB recommendations and rulings is based on careful consideration of the facts, Canada's WTO rights and obligations, and consultations with Canadian vehicle manufacturers and the provinces.

Consultations will continue with stakeholders throughout the implementation of the remaining Auto Pact findings, particularly with respect to the modifications required to existing customs practices to ensure that there is a smooth transition from the Auto Pact regime to the new customs reporting and accounting procedures that will be introduced for automotive imports.

Compliance and Enforcement

The Canada Customs and Revenue Agency, which administers customs and tariff legislation/regulations, will ensure that vehicles imported into Canada receive the appropriate tariff treatment.

Contact

Dean Steadman, International Trade Policy Division, Department of Finance, Ottawa, Ontario K1A 0G5, (613) 947-4508.

PROPOSED REGULATORY TEXT

Notice is hereby given that the Governor in Council, pursuant to subsection 14(2) and section 16 of the Customs Tariff (see footnote a), proposes to make the annexed Order Repealing the Motor Vehicles Tariff Order, 1998.

Interested persons may make representations with respect to the proposed Order to the Minister of Finance or the Minister of Industry within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to Dean Steadman, International Trade Policy Division, Department of Finance, L'Esplanade Laurier, 14th Floor, 140 O'Connor Street, Ottawa, Ontario K1A 0G5 (Tel.: (613) 947-4508; fax.: (613) 992-6761) or to Guy Leclaire, Automotive and Transportation Branch, Industry Canada, C.D. Howe Building, Floor 010E, Room 1063C, 235 Queen Street, Ottawa, Ontario K1A 0H5 (Tel.: (613) 954-2949; fax.: (613) 952-8088).

Ottawa, December 13, 2000

MARC O'SULLIVAN
Assistant Clerk of the Privy Council

ORDER REPEALING THE MOTOR VEHICLES TARIFF ORDER, 1998

REPEAL

1. The Motor Vehicles Tariff Order, 1998 (see footnote 1) is repealed.

COMING INTO FORCE

2. This Order comes into force on February 18, 2001.

[51-1-o]

Order Repealing Certain Remission Orders Made under the Financial Administration Act (2000-1)

Statutory Authority

Financial Administration Act

Sponsoring Department

Department of Finance

REGULATORY IMPACT ANALYSIS STATEMENT

For the Regulatory Impact Analysis Statement, see Order Repealing the Motor Vehicles Tariff Order, 1998.

PROPOSED REGULATORY TEXT

Notice is hereby given that the Governor in Council, pursuant to subsection 23(2)(see footnote b) of the Financial Administration Act, proposes to make the annexed Order Repealing Certain Remission Orders Made under the Financial Administration Act (2000-1).

Interested persons may make representations with respect to the proposed Order to the Minister of Finance or the Minister of Industry within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to Dean Steadman, International Trade Policy Division, Department of Finance, L'Esplanade Laurier, 14th Floor, 140 O'Connor Street, Ottawa, Ontario K1A 0G5 (Tel.: (613) 947-4508; fax.: (613) 992-6761) or to Guy Leclaire, Automotive and Transportation Branch, Industry Canada, C.D. Howe Building, Floor 010E, Room 1063C, 235 Queen Street, Ottawa, Ontario K1A 0H5 (Tel.: (613) 954-2949; fax.: (613) 952-8088).

Ottawa, December 13, 2000

MARC O'SULLIVAN
Assistant Clerk of the Privy Council

ORDER REPEALING CERTAIN REMISSION ORDERS MADE UNDER THE FINANCIAL ADMINISTRATION ACT (2000-1)

SPECIFIED COMMERCIAL VEHICLES, MACK TRUCKS, REMISSION ORDER

1. The Specified Commercial Vehicles, Mack Trucks, Remission Order(see footnote 2) is repealed.

BUSES, MOTOR COACH INDUSTRIES LIMITED, REMISSION ORDER

2. The Buses, Motor Coach Industries Limited, Remission Order(see footnote 3) is repealed.

SPECIFIED COMMERCIAL VEHICLES, UNIVERSAL CARRIER REMISSION ORDER

3. The Specified Commercial Vehicles, Universal Carrier Remission Order (see footnote 4) is repealed.

COMING INTO FORCE

4. This Order comes into force on February 18, 2001.

[51-1-o]

Order Repealing Certain Remission Orders Made under the Financial Administration Act (2000-2)

Statutory Authority

Financial Administration Act

Sponsoring Department

Department of Finance

EXPLANATORY NOTE

(This note is not part of the Order.)

This Order implements, in part, the recommendations and rulings of the Dispute Settlement Body of the World Trade Organization that found measures implementing the Auto Pact in Canada to be inconsistent with Canada's obligations under the General Agreement on Tariffs and Trade, 1994, the Agreement on Subsidies and Countervailing Measures and the General Agreement on Trade in Services.

PROPOSED REGULATORY TEXT

Notice is hereby given that the Governor in Council, pursuant to subsection 23(2) (see footnote c) of the Financial Administration Act, proposes to make the annexed Order Repealing Certain Remission Orders Made under the Financial Administration Act (2000-3).

Interested persons may make representations with respect to the proposed Order to the Minister of Finance or the Minister of Industry within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to Dean Steadman, International Trade Policy Division, Department of Finance, L'Esplanade Laurier, 14th Floor, 140 O'Connor Street, Ottawa, Ontario K1A 0G5 (Tel.: (613) 947-4508; fax.: (613) 992-6761) or to Guy Leclaire, Automotive and Transportation Branch, Industry Canada, C.D. Howe Building, Floor 010E, Room 1063C, 235 Queen Street, Ottawa, Ontario K1A 0H5 (Tel.: (613) 954-2949; fax.: (613) 952-8088).

Ottawa, December 13, 2000

MARC O'SULLIVAN
Assistant Clerk of the Privy Council

ORDER REPEALING CERTAIN REMISSION ORDERS MADE UNDER THE FINANCIAL ADMINISTRATION ACT (2000-2)

REPEAL

1. The orders set out in the schedule are repealed.

COMING INTO FORCE

2. This Order comes into force on February 18, 2001.

SCHEDULE
(Section 1)

Item	Column 1 Title	Column 2 Reference
1.	Truck Equipment Remission Order	SI/72-38
2.	Universal Equipment Remission Order	SI/72-40
3.	Teal Manufacturing Remission Order	SI/72-53
4.	Tor Truck Remission Order	SI/76-28; SI/88-37
5.	Ontario Bus Industries Remission Order	SI/77-42
6.	Welles Corporation Limited Remission Order	SI/77-230
7.	Sturdy Remission Order	SI/78-55; SI/88-37
8.	Thermo King Remission Order	SI/78-122; SI/88-37
9.	Dominion Truck Remission Order	SI/78-150; SI/88-37
10.	Paccar Canada Limited Remission Order	SI/78-151
11.	D. & C. Roussy Remission Order	SI/78-154; SI/88-37
12.	Central Truck Remission Order	SI/79-6; SI/88-37
13.	Twin Equipment Outaouais Ltd. Remission Order	SI/80-29; SI/95-131
14.	Remtec Inc. Remission Order	SI/81-42
15.	Transit Van Bodies Inc. Remission Order	SI/81-43
16.	Bombardier Inc., Logistic Equipment Division Remission Order	SI/82-72
17.	Contran Manufacturing (1982) Limited Remission Order	SI/82-92; SI/95-131
18.	Sentinel Vehicles (1990) Ltd. Remission Order	SI/82-138; SI/95-131
19.	Western Star Trucks Inc., Remission Order	SI/82-171
20.	Lennoxvan (1986) Inc. Remission Order	SI/82-172; SI/88-37
21.	Pollock Truck Bodies Division of Pollock Rentals Limited Remission Order	SI/83-4; SI/88-37
22.	Commercial Vans Inc. Remission Order	SI/83-8
23.	George C. Doerr Body and Trailer Co. Remission Order	SI/83-18
24.	919619 Ontario Inc. O/A Cascade Truck Bodies Remission Order	SI/83-78; SI/95-131
25.	Aurora Cars Limited Remission Order	SI/83-99
26.	Girardin Corporation Remission Order	SI/83-100; SI/88-37
27.	Québec Truck Bodies Boîtes de Camions Inc. Remission Order	SI/84-15
28.	Wiltsie Truck Bodies Ltd. Remission Order	SI/84-16
29.	Western Utilities Equipment Co. Ltd. Remission Order	SI/84-18
30.	Jean-Marc Vigeant Inc. Remission Order	SI/84-53
31.	PK Welding & Fabricators Limited Remission Order	SI/84-60
32.	Navistar International Corporation Canada Remission Order	SI/84-75; SI/88-37
33.	Maynards Industries Ltd. Remission Order	SI/84-114; SI/95-131
34.	Bombardier Inc., Logistic Equipment Division Remission Order (1984)	SI/84-115
35.	Parco-Hesse Corporation Inc. Remission Order	SI/84-138; SI/88-37
36.	Ontario Fiberglass Production O/B 536794 Ont. Ltd. Remission Order	SI/84-139
37.	Wilson's Truck Bodies, a Division of L&A Machine (N.S.) Limited Remission Order	SI/84-162
38.	Minoru Truck Bodies Ltd. Remission Order	SI/85-107
39.	Capital Disposal Equipment Inc. Remission Order	SI/85-185
40.	Eastway Tank, Pump and Meter Co. Ltd. Remission Order	SI/87-7
41.	Fanotech Enviro Inc. Remission Order	SI/87-8; SI/95-131
42.	Western Rock Bit Company Limited Remission Order	SI/87-41
43.	Capital Truck Bodies, a Division of 519169 Ontario Limited Remission Order	SI/87-42; SI/95-131
44.	Dependable Truck and Tank Limited Remission Order	SI/87-43; SI/95-131
45.	Fourgons Provincial Inc. Remission Order	SI/87-44; SI/89-20
46.	Raytel Equipment Ltd. Remission Order	SI/87-45
47.	Advance Engineered Products Ltd. Remission Order	SI/87-46
48.	Tipping Motor Bodies Limited Remission Order	SI/87-47
49.	IMT Cranes Canada, Ltd. Remission Order	SI/87-48
50.	Univision Industries Limited Remission Order	SI/87-49
51.	Bevcam Inc. Remission Order	SI/87-50
52.	Rebel Steel Industries Ltd. Remission Order	SI/87-51
53.	Wilcox Bodies Limited Remission Order	SI/87-62
54.	BEL, Boîtes de Camions Inc. Remission Order	SI/87-80; SI/95-131
55.	Intercontinental Truck Body B.C. Inc. Remission Order	SI/87-81
56.	Intercontinental Truck Body Ltd. Remission Order	SI/87-82
57.	Équipement Labrie Ltée Remission Order	SI/87-95
58.	Les Entreprises Michel Corbeil Inc. Remission Order	SI/87-157
59.	Vulcan Equipment Company Limited Remission Order	SI/87-214
60.	Knight Trailer Company Inc. Remission Order	SI/87-215; SI/95-131
61.	Dempster Systems Limited Remission Order	SI/87-216
62.	Atelier Gérard Laberge Inc. Remission Order	SI/89-22
63.	Boîtes de Camions G.A.M. Inc. Remission Order	SI/89-24
64.	Burke Canada Inc. Remission Order	SI/89-25
65.	CAMI Automotive Inc. Remission Order	SI/89-26
66.	County Truck & Trailer Remission Order	SI/89-27
67.	Cusco Industries Remission Order	SI/89-28
68.	Deluxe Van & Body (1988) Ltd. Remission Order	SI/89-29; SI/95-131
69.	Durabody and Trailer Ltd. Remission Order	SI/89-30
70.	Dynamic Fiber Ltd. Remission Order	SI/89-31
71.	Ford Motor Company of Canada Limited Remission Order, 1988	SI/89-32
72.	Intercontinental Truck Body (Man.) Inc. Remission Order	SI/89-33; SI/95-131
73.	NovaBus Corporation Remission Order	SI/89-34; SI/95-131
74.	Intermeccanica International Inc. Remission Order	SI/89-36
75.	Kamloops Allweld Aluminum Service Ltd. Remission Order	SI/89-37
76.	Les Boîtes de Camions Alco Inc. Remission Order	SI/89-38
77.	Supravan Ltée Remission Order	SI/89-41
78.	Thermo King Western (Calgary) Ltd. Remission Order	SI/89-42
79.	Toronto Kitchen Equipment Ltd. Remission Order	SI/89-43
80.	UTDC Inc. Remission Order	SI/89-45
81.	Universal Truck Body Ltd. Remission Order	SI/89-46
82.	Westank-Willock Remission Order	SI/89-47

[51-1-o]

Order Repealing Certain Remission Orders Made under the Financial Administration Act (2000-3)

Statutory Authority

Financial Administration Act

Sponsoring Department

Department of Finance

EXPLANATORY NOTE

(This note is not part of the Order.)

This Order repeals a number of "export-based" remission orders which, in accordance with the terms of the Canada-United States Free Trade Agreement and the North American Free Trade Agreement, were terminated for importation purposes on January 1, 1998, but were not repealed at that time in order to provide sufficient time to process refund claims in respect of importations occurring prior to January 1, 1998. The Canada Customs and Revenue Agency is satisfied that there are no claims outstanding in respect of these orders and that they can now be repealed.

PROPOSED REGULATORY TEXT

Notice is hereby given that the Governor in Council, pursuant to subsection 23(2) (see footnote d) of the Financial Administration Act, proposes to make the annexed Order Repealing Certain Remission Orders Made under the Financial Administration Act (2000-3).

Interested persons may make representations with respect to the proposed Order to the Minister of Finance or the Minister of Industry within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to Dean Steadman, International Trade Policy Division, Department of Finance, L'Esplanade Laurier, 14th Floor, 140 O'Connor Street, Ottawa, Ontario K1A 0G5 (Tel.: (613) 947-4508; fax.: (613) 992-6761) or to Guy Leclaire, Automotive and Transportation Branch, Industry Canada, C.D. Howe Building, Floor 010E, Room 1063C, 235 Queen Street, Ottawa, Ontario K1A 0H5 (Tel.: (613) 954-2949; fax.: (613) 952-8088).

Ottawa, December 13, 2000

MARC O'SULLIVAN
Assistant Clerk of the Privy Council

ORDER REPEALING CERTAIN REMISSION ORDERS MADE UNDER THE FINANCIAL ADMINISTRATION ACT (2000-3)

REPEAL

1. The orders set out in the schedule are repealed.

COMING INTO FORCE

2. This Order comes into force on February 18, 2001.

SCHEDULE
(Section 1)

Item	Column 1 Title	Column 2 Reference
1.	Roberts Remission Order	SI/76-104
2.	Phil Larochelle Remission Order 1977	SI/78-54; SI/91-24
3.	Off-Highway Vehicles Remission Order	C.R.C., c. 777
4.	Fiat Remission Order 1979	SI/80-47
5.	Volkswagen Remission Order, 1982	SI/83-104
6.	Jaguar Remission Order, 1984	SI/85-50
7.	Mazda Remission Order, 1984	SI/85-51
8.	Mercedes-Benz Remission Order, 1984	SI/85-52
9.	Nissan Remission Order, 1984	SI/85-53
10.	Peugeot Remission Order, 1984	SI/85-54
11.	Subaru Remission Order, 1984	SI/85-55
12.	BMW Remission Order, 1984	SI/85-57
13.	Saab-Scania Remission Order	SI/89-12
14.	Hyundai Remission Order, 1988-1	SI/89-13
15.	Toyota Canada Inc. Remission Order, 1988	SI/89-17
16.	Honda Remission Order, 1989	SI/89-18

[51-1-o]

Footnote a

S.C. 1997, c. 36

Footnote 1

SOR/98-43

Footnote b

S.C. 1991, c. 24, s. 7(2)

Footnote 2

SOR/65-267

Footnote 3

SOR/67-130

Footnote 4

SOR/67-575

Footnote c

S.C. 1991, c. 24, s. 7(2)

Footnote d

S.C. 1991, c. 24, s. 7(2)

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