Registration

SOR/2008-286 September 5, 2008

EXPORT AND IMPORT PERMITS ACT

Order Amending the General Import Permit No. 1—Dairy Products for Personal Use

The Minister of Foreign Affairs, pursuant to subsections 8(1.1) (see footnote a) and 10(1) (see footnote b) of the Export and Import Permits Act (see footnote c), hereby makes the annexed Order Amending the General Import Permit No. 1—Dairy Products for Personal Use.

September 3, 2008

DAVID EMERSON
Minister of Foreign Affairs

ORDER AMENDING THE GENERAL IMPORT PERMIT NO. 1—DAIRY PRODUCTS FOR PERSONAL USE

AMENDMENT

1. The schedule to the General Import Permit No. 1—Dairy Products for Personal Use (see footnote 1) is amended by adding the following after item 13.1:

13.2 Milk protein substances with a milk protein content of 85% or more by weight, calculated on a dry matter basis, that do not originate in a NAFTA country, Chile, Costa Rica or Israel and that are the subject of two commitments signed by the Government of Canada on June 12, 2008, one with the European Communities and the other with the Government of Switzerland, relating to the modification, in Canada’s schedule of concessions pursuant to the Agreement Establishing the World Trade Organization, to Canada’s concession on tariff item No. 3504.00.00 in the List of Tariff Provisions set out in the schedule to the Customs Tariff with regard to those substances.

COMING INTO FORCE

2. This Order comes into force on September 8, 2008, but if it is registered after that day, it comes into force on the day on which it is registered.

REGULATORY IMPACT
ANALYSIS STATEMENT

(This statement is not part of the Order.)

Issue and objectives

Canada has concluded a re-negotiation of certain of our World Trade Organization (WTO) tariff concessions, initiated under GATT Article XXVIII, with the European Communities (EC) and Switzerland.The tariff concession in question concerns milk protein substances with a milk protein content of 85% or more by weight, calculated on a dry matter basis. In accordance with subsections 8(1.1) and 10(1) of the Export and Import Permits Act, in order to implement the agreement with the EC and Switzerland, General Import Permit No. 1 and No. 100 must be amended to include Item 125.2, which pertains to milk protein substances with a milk protein content of 85% or more by weight, calculated on the dry matter, that are classified under tariff item No. 3504.00.11 or 3504.00.12. Effective September 8, 2008, the Schedule to the Customs Tariff is deemed to be amended to reflect the conclusion of the negotiations. The effective date of the amendments to General Import Permit No. 1 and No. 100 should, therefore, coincide with the effective date of the amendments made to the Schedule to the Customs Tariff, namely September 8, 2008.

Objectives of government intervention by this ministerial order are the following:

1. to implement a change in Canada’s WTO obligations subsequent to a re-negotiation of a tariff concession, as outlined in an intergovernmental arrangement, concluded with the EC and Switzerland; and

2. to establish the import controls that will be necessary to administer the proposed amendments to the Schedule to the Customs Tariff.

Description and rationale

In January 2006, in the case of Les Produits Laitiers Advidia Inc. and the Canada Customs and Revenue Agency (now Canada Border Services Agency), the Federal Court of Appeal upheld a Canadian International Trade Tribunal (CITT) decision concerning the tariff classification of certain milk protein concentrates. The CITT ruling effectively lowered the rate of duty applicable to certain milk protein concentrates (MPCs) to 6.5% from the 270% over-quota tariff formerly applicable.

The Minister of Agriculture and Agri-Food, in April 2006, invited leaders from the Dairy Farmers of Canada (DFC) and the Dairy Processors Association of Canada (DPAC) to form a Dairy Industry Working Group (DIWG) with a view to developing common positions to address this issue, among others, to ensure continued growth and profitability of the dairy industry. The DIWG was not able to reach a consensus. As a result, the DFC requested that the Government initiate Article XXVIII negotiations under the WTO.

In February 2007, the Ministers of Agriculture and Agri-Food Canada and of International Trade Canada announced the Government’s intention to undertake GATT Article XXVIII negotiations to modify Canada’s WTO commitments regarding the tariff treatment of certain imported MPCs. Following this announcement, the Article XXVIII process was launched.

An agreement was reached on the GATT Article XXVIII negotiations and the Schedule to the Customs Tariff will be amended by the Department of Finance to reflect the conclusion of the GATT Article XXVIII process concerning milk protein substances with a milk protein content of 85% or more by weight, calculated on a dry matter basis.

These amendments to General Import Permit No. 1 and No. 100 are needed in order to implement the results of the Article XXVIII negotiations with the EC and Switzerland. Specifically, the additions to General Import Permit No. 1 and No. 100 pertain to milk protein substances with a milk protein content of 85% or more by weight, calculated on the dry matter, that are classified under tariff item No. 3504.00.11 or 3504.00.12. Effective September 8, 2008, the Schedule to the Customs Tariff is deemed to be amended to reflect the conclusion of the negotiations. The effective date of the amendments to General Import Permit No. 1 and No. 100 should coincide, therefore, with the effective date of the amendments made to the Schedule to the Customs Tariff, namely September 8, 2008.

These amendments will have no impact on existing policy, will involve no new financial implications and are needed to ensure continuity of import controls.

These amendments to General Import Permit No. 1 and No. 100 are needed in order to implement the results of the Article XXVIII negotiations with the EC and Switzerland. Specifically, the additions to General Import Permit No. 1 and No. 100 pertain to milk protein substances with a milk protein content of 85% or more by weight, calculated on the dry matter, that are classified under tariff item No. 3504.00.11 or 3504.00.12. They do not involve any new policy or financial implications which could have an impact on Canadian industry; therefore, no consultations were held on these proposed amendments.

The amendments to General Import Permit No. 1 and No. 100 are needed to implement an intergovernmental arrangement concluded with the EC and Switzerland, resulting from Canada’s GATT Article XXVIII negotiations initiated on April 11, 2007. There are no alternatives available to effectively administer the intergovernmental arrangements in question.

Consultation

The proposed measures are consistent with existing import control policies and do not involve any new policy or financial implications which could have an impact on Canadian industry; therefore, no consultations were held on the measures at issue.

Implementation, enforcement and service standards

General Import Permits are administered and enforced by the Canada Border Services Agency (CBSA). The CBSA will be notified of the addition of tariff items No. 3504.00.11 or 3504.00.12 (milk protein substances with a milk protein content of 85% or more by weight, calculated on the dry matter) to General Import Permit No. 1 and No. 100.

Contact

Hugues Leroux
International Trade Officer
Agriculture Section (TICA)
Trade Controls Policy Division
Export and Import Controls Bureau
Department of Foreign Affairs and International Trade
125 Sussex Drive
Ottawa, Ontario
K1A 0G2
Telephone: 613-996-2594

Footnote a
S.C. 1994, c. 47, s. 108(1)

Footnote b
S.C. 2006, c. 13, s. 113

Footnote c
R.S., c. E-19

Footnote 1
SOR/95-40; SOR/97-40

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