ARCHIVED — Vol. 146, No. 21 — October 10, 2012

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Registration

SOR/2012-197 September 28, 2012

CUSTOMS TARIFF

Order Amending the Schedule to the Customs Tariff, 2012–1 and a Related Order

P.C. 2012-1140 September 27, 2012

His Excellency the Governor General in Council, on the recommendation of the Minister of Finance, pursuant to sections 34 (see footnote a) and 82 of the Customs Tariff (see footnote b), makes the annexed Order Amending the Schedule to the Customs Tariff, 2012–1 and a Related Order.

ORDER AMENDING THE SCHEDULE TO THE CUSTOMS TARIFF, 2012–1 AND A RELATED ORDER

AMENDMENTS TO THE SCHEDULE TO THE CUSTOMS TARIFF

1. Tariff item Nos. 7302.30.00 and 8704.21.00 in the List of Tariff Provisions set out in the schedule to the Customs Tariff (see footnote 1) are repealed.

2. The List of Tariff Provisions set out in the schedule to the Act is amended as set out in Part 1 of the schedule to this Order.

3. The List of Tariff Provisions set out in the schedule to the Act is amended by adding, in numerical order, the tariff provision set out in Part 2 of the schedule to this Order.

4. The List of Tariff Provisions set out in the schedule to the Act is amended by adding, in numerical order, the tariff provisions set out in Part 3 of the schedule to this Order.

5. The List of Intermediate and Final Rates for Tariff Items of the “F” Staging Category set out in the schedule to the Act is amended by adding, in numerical order, the tariff item set out in Part 4 of the schedule to this Order.

6. The List of Intermediate and Final Rates for Tariff Items of the “F” Staging Category set out in the schedule to the Act is amended by adding, in numerical order, the tariff item set out in Part 5 of the schedule to this Order.

CONSEQUENTIAL AMENDMENTS TO THE GENERAL PREFERENTIAL TARIFF WITHDRAWAL (CERTAIN AUTOMOTIVE GOODS) ORDER

7. (1) Subsection 2(1) of the General Preferential Tariff Withdrawal (Certain Automotive Goods) Order (see footnote 2) is amended by deleting Tariff item No. “8704.21.00,”.

(2) Subsection 2(1) of the Order is amended by adding Tariff item Nos. “8704.21.10,” and “8704.21.90,” in numerical order.

COMING INTO FORCE

8. (1) This Order, except sections 3 and 5, comes into force on the day on which it is registered.

(2) Sections 3 and 5 are deemed to have come into force on December 14, 2011.

SCHEDULE

PART 1
(Section 2)

AMENDMENTS TO THE LIST OF TARIFF PROVISIONS

1. The Description of Goods of Tariff item No. 9995.00.00 is amended

  • (a) by replacing the reference to “filled solely with “commercial landfowl feather”, “commercial waterfowl feather”, or “commercial down” or any combination thereof, as defined in the Textile Labelling and Advertising Regulations.” with a reference to “filled solely with “commercial landfowl feather”, “commercial waterfowl feather”, or “commercial down” or any combination thereof, as defined in the Textile Labelling and Advertising Regulations, or synthetic staple fibres of Chapter 55.”; and

  • (b) by replacing the reference to “Shells made solely of the above fabrics for use in the manufacture of duvets, featherbeds and pillows filled solely as described above.” with a reference to “Shells, made of fabrics of Chapter 52, 54, 55, 58 or 60, for use in the manufacture of duvets, featherbeds and pillows filled solely as described above.”.

2. The Description of Goods of Tariff item No. 9996.00.00 is amended

  • (a) by replacing the reference to “Regulations.” at the end of paragraph (d) with a reference to “Regulations; or” and by adding the following:

  • (e) synthetic staple fibres of Chapter 55.; and

  • (b) by replacing the reference to “Shells made solely of the above fabrics for use in the manufacture of featherbeds and pillows filled solely as described above.” with a reference to “Shells, made of fabrics of Chapter 52, 54, 55, 58 or 60, for use in the manufacture of featherbeds and pillows filled solely as described above.”.

PART 2
(Section 3)

ADDITION TO THE LIST OF TARIFF PROVISIONS

Tariff Item

Description of Goods

Most-Favoured-Nation Tariff

Preferential Tariff

Initial Rate

Final Rate

Initial Rate

Final Rate

6307.90.50

---Shells for use in the manufacture of articles of subheading 9404.90 

14%

14% (A)

UST: Free

UST: Free (A)

MT: Free

MT: Free (A)

       

MUST: Free

MUST: Free (A)

       

CT: Free

CT: Free (A)

       

CIAT: Free

CIAT: Free (A)

       

CRT: Free

CRT: Free (A)

       

IT: Free

IT: Free (A)

       

NT: Free

NT: Free (A)

       

SLT: Free

SLT: Free (A)

       

PT: Free

PT: Free (A)

       

COLT: 12%

COLT: Free (F)

       

GPT: N/A

GPT: N/A

       

LDCT: Free

LDCT: Free (A)

       

CCCT: Free

CCCT: Free (A)

       

AUT: N/A

AUT: N/A

       

NZT: N/A

NZT: N/A

PART 3
(Section 4)

ADDITIONS TO THE LIST OF TARIFF PROVISIONS

Tariff Item

Description of Goods

Most-Favoured-Nation Tariff

Preferential Tariff

Initial Rate

Final Rate

Initial Rate

Final Rate

1511.90.30

---Palm oil flakes for use in the manufacture of food products

Free

Free (A)

UST: Free

UST: Free (A)

MT: Free

MT: Free (A)

       

MUST: N/A

MUST: N/A

       

CT: Free

CT: Free (A)

       

CIAT: N/A

CIAT: N/A

       

CRT: Free

CRT: Free (A)

       

IT: Free

IT: Free (A)

       

NT: N/A

NT: N/A

       

SLT: N/A

SLT: N/A

       

PT: Free

PT: Free (A)

       

COLT: Free

COLT: Free (A)

       

GPT: Free

GPT: Free (A)

       

LDCT: Free

LDCT: Free (A)

       

CCCT: Free

CCCT: Free (A)

       

AUT: N/A

AUT: N/A

       

NZT: N/A

NZT: N/A

           

3926.90.93

----Trays designed to hold discs, for use in the manufacture of CD or DVD cases or boxed set collections

4%

Free (F)

UST: Free

UST: Free (A)

MT: Free

MT: Free (A)

MUST: Free

MUST: Free (A)

       

CT: Free

CT: Free (A)

       

CIAT: Free

CIAT: Free (A)

       

CRT: Free

CRT: Free (A)

       

IT: Free

IT: Free (A)

       

NT: Free

NT: Free (A)

       

SLT: Free

SLT: Free (A)

       

PT: Free

PT: Free (A)

       

COLT: Free

COLT: Free (A)

       

GPT: 3%

GPT: Free (F)

       

LDCT: Free

LDCT: Free (A)

       

CCCT: Free

CCCT: Free (A)

       

AUT: N/A

AUT: N/A

       

NZT: N/A

NZT: N/A

           

7302.30

-Switch blades, crossing frogs, point rods and other crossing pieces

       

7302.30.10

---For use with grooved or girder guard rail

Free

Free (A)

UST: Free

UST: Free (A)

 

 

   

MT: Free

MT: Free (A)

       

MUST: Free

MUST: Free (A)

       

CT: Free

CT: Free (A)

       

CIAT: Free

CIAT: Free (A)

       

CRT: Free

CRT: Free (A)

       

IT: Free

IT: Free (A)

       

NT: Free

NT: Free (A)

       

SLT: Free

SLT: Free (A)

       

PT: Free

PT: Free (A)

       

COLT: Free

COLT: Free (A)

       

GPT: Free

GPT: Free (A)

       

LDCT: Free

LDCT: Free (A)

       

CCCT: Free

CCCT: Free (A)

       

AUT: N/A

AUT: N/A

       

NZT: N/A

NZT: N/A

           

7302.30.90

---Other

6.5%

6.5% (A)

UST: Free

UST: Free (A)

       

MT: Free

MT: Free (A)

       

MUST: Free

MUST: Free (A)

       

CT: Free

CT: Free (A)

       

CIAT: Free

CIAT: Free (A)

       

CRT: Free

CRT: Free (A)

       

IT: Free

IT: Free (A)

       

NT: Free

NT: Free (A)

       

SLT: Free

SLT: Free (A)

       

PT: Free

PT: Free (A)

       

COLT: Free

COLT: Free (A)

       

GPT: 5%

GPT: 5% (A)

       

LDCT: Free

LDCT: Free (A)

       

CCCT: Free

CCCT: Free (A)

       

AUT: N/A

AUT: N/A

       

NZT: N/A

NZT: N/A

           

8704.21

--g.v.w. not exceeding 5 tonnes

       

8704.21.10

---For conversion to ambulances

Free

Free (A)

UST: Free

UST: Free (A)

       

MT: Free

MT: Free (A)

 

Note: The benefit of the General Preferential Tariff is withdrawn from goods of this tariff item that originate in the Republic of Korea.

   

MUST: Free

MUST: Free (A)

CT: Free

CT: Free (A)

CIAT: Free

CIAT: Free (A)

       

CRT: Free

CRT: Free (A)

       

IT: Free

IT: Free (A)

       

NT: Free

NT: Free (A)

       

SLT: Free

SLT: Free (A)

       

PT: Free

PT: Free (A)

       

COLT: Free

COLT: Free (A)

       

GPT: Free

GPT: Free (A)

       

LDCT: Free

LDCT: Free (A)

       

CCCT: Free

CCCT: Free (A)

       

AUT: N/A

AUT: N/A

       

NZT: N/A

NZT: N/A

           

8704.21.90

---Other

6.1%

6.1% (A)

UST: Free

UST: Free (A)

       

MT: Free

MT: Free (A)

 

Note: The benefit of the General Preferential Tariff is withdrawn from goods of this tariff item that originate in the Republic of Korea. 

   

MUST: Free

MUST: Free (A)

CT: Free

CT: Free (A)

CIAT: Free

CIAT: Free (A)

       

CRT: Free

CRT: Free (A)

       

IT: Free

IT: Free (A)

       

NT: Free

NT: Free (A)

       

SLT: Free

SLT: Free (A)

       

PT: Free

PT: Free (A)

       

COLT: Free

COLT: Free (A)

       

GPT: 6%

GPT: 6% (A)

       

LDCT: Free

LDCT: Free (A)

       

CCCT: Free

CCCT: Free (A)

       

AUT: N/A

AUT: N/A

       

NZT: N/A

NZT: N/A

PART 4
(Section 5)

ADDITION OF TARIFF ITEM

Tariff Item

Most-Favoured-Nation Tariff

Preferential Tariff

6307.90.50

 

Effective on January 1, 2012.................................COLT: 10%

   

Effective on January 1, 2013...................................COLT: 8%

   

Effective on January 1, 2014...................................COLT: 6%

   

Effective on January 1, 2015...................................COLT: 4%

   

Effective on January 1, 2016...................................COLT: 2%

   

Effective on January 1, 2017..................................COLT: Free

PART 5
(Section 6)

ADDITION OF TARIFF ITEM

Tariff Item

Most-Favoured-Nation Tariff

Preferential Tariff

3926.90.93

Effective on January 1, 2013..............................................3%

 
 

Effective on January 1, 2014..............................................2%

Effective on January 1, 2014.....................................GPT: 2%

 

Effective on January 1, 2015.............................................Free

Effective on January 1, 2015....................................GPT: Free

REGULATORY IMPACT
ANALYSIS STATEMENT

(This statement is not part of the Order.)

Issue and objectives

The products included in this Order are a result of specific industry requests for duty relief. In one instance, the Order also addresses a Canada Border Services Agency (CBSA) revised administrative policy concerning the tariff classification of certain fabric shells.

Reducing tariffs on these items will help lower production costs for Canadian businesses and enhance their overall competitiveness. This Order is consistent with the Government’s commitment to make Canada a tariff-free zone for industrial manufacturers.

Description and rationale

This Order eliminates/reduces the most-favoured-nation (MFN) rate of customs duty on the following products:

  • Certain palm oil flakes for use in the manufacture of food products (new tariff item 1511.90.30);
  • Certain trays designed to hold discs for use in the manufacture of CD or DVD cases (new tariff item 3926.90.93);
  • Certain fabric shells for use in the manufacture of duvets, comforters, featherbeds cushions or pillows (bed linens) [6307.90.50, amendments to existing tariff items 9995.00.00, 9996.00.00];
  • Certain crossing pieces for use with grooved or girder guard rail (new tariff item 7302.30.10); and
  • Certain chassis and motors for use in the manufacture of ambulances (for conversion to ambulances) [new tariff item 8704.21.10].

The tariff relief in this Order is consistent with the Government’s long-standing policy of providing tariff relief to support competitiveness as well as its commitment to make Canada a tariff-free zone for industrial manufacturers. Implementing the tariff relief via an Order in Council is the most appropriate and timely method to assist Canadian manufacturers in competing more effectively in both the domestic and export markets.

As a result of certain structural changes being introduced by this Order, a consequential amendment is required to the General Preferential Tariff Withdrawal (Certain Automotive Goods) Order to maintain the current withdrawal of the General Preferential Tariff (GPT) on goods originating in the Republic of Korea. The amendment replaces the reference to deleted tariff item 8704.21.00 in subsection 2(1) of that Order with references to the new tariff items (8704.21.10 and 8704.21.90) being introduced by this Order. Since the GPT was withdrawn from former tariff item 8704.21.00, it must be withdrawn from the new tariff items to maintain the status quo for these goods originating in the Republic of Korea.

The Order also addresses a disparity in the application of the North American Free Trade Agreement (NAFTA) rules of origin between Canada and the United States in respect of bed linens manufactured by stuffing imported fabric shells. For many years, certain fabric shells were classified with the finished good (stuffed bed linens) in Chapter 94 of the Harmonized System (HS) when imported into Canada. However, the same product was classified under Chapter 63 of the HS when imported into the United States. As a result of this difference in tariff classification, American importers of stuffed bed linens made by Canadian manufacturers could purchase the bed linens duty-free under NAFTA, while Canadian importers of American-made products were subject to a 14% most-favoured-nation (MFN) rate of customs duty because the stuffed bed linens did not meet the applicable NAFTA rule of origin, which requires that the goods undergo a change in tariff classification from the imported shell to the finished good. Therefore, in order to have a common NAFTA approach, the CBSA revised its administrative policy to align its tariff classification practices with those of the United States for these goods.

Based on current import levels of these products, the estimated annual duties foregone to the Government as a result of this Order will be approximately $1.7 million. These duties foregone represent corresponding savings for Canadian industry on manufacturing inputs used in their production processes, hence lowering their costs and enhancing competitiveness in both domestic and international markets.

Consultation

Extensive consultations were undertaken on products included in this Order. All stakeholder views have been considered in the development of this proposal.

Implementation, enforcement and service standards

The CBSA is responsible for the administration of and compliance with customs and tariff legislation and regulations. In the course of its administration of these tariff changes, the CBSA will inform the importing community.

Contact

Diane Kelloway
International Trade Policy Division
Department of Finance
Ottawa, Ontario
K1A 0G5
Telephone: 613-996-6470

Footnote a
S.C. 2011, c. 24, s. 118

Footnote b
S.C. 1997, c. 36

Footnote 1
S.C. 1997, c.36

Footnote 2
SOR/96-5