While the Trump tariffs have so far singled out allegedly unfair treatment of the US by Canada when it comes to border protection and the fentanyl crisis, the question remains if focus might shift to Canada’s supply management system.
A recent announcement from Canada Border Services Agency (“CBSA”) indicated Canada’s dry wheat quota had already been surpassed on January 12, mere weeks into the year. This raises questions about the fairness of the tariff rate quota (“TRQ”) system for anyone but the largest Canadian importers who have the means to take advantage of it.
As discussed here and here, Canada has one of the most protectionist agricultural product sectors in the world. Indeed, we have import restrictions and incredibly high tariffs on many basic groceries like cheese, eggs and poultry – all leading to fuel inflation in Canada today, and continuing disputes with countries like the US and New Zealand over our protectionist approach.
This affects consumer and commercial importers of these products, with our current government enforcing import restrictions through tariff rate quotas (“TRQs”).
Businesses in the automotive sector will be interested in the recent conclusion to the automotive trade dispute between Canada, the US, and Mexico (the “USMCA Parties”).
The USMCA Parties had different interpretations of the automotive rules in the Canada-United States-Mexico trade Agreement (the “USMCA”), which required a USMCA Panel to be formed to review the different interpretations and settle the dispute.
This decision is important because it makes it easier for automotive producers to receive preferential tariff treatment under the USMCA, which will help the USMCA Parties save costs when importing and exporting vehicles between the USMCA Parties.
